NFT Market Dynamics Unveil Worrying Signals for the Crypto Sphere
The so-strong NFT market could have entered a dangerous territory for the cryptocurrency market, according to the former head of the crypto-related investment fund Ark Invest.
Chris Burniske pointed out that both NFT and digital asset markets have been showing opposite signals that suggest that more bearish waves could be hitting the crypto sphere in the near term.
In fact, Burniske stated that such divergence could be backed by the strong rise in the NFT adoption.
LTC and BTC Cycles
“One could also say NFTs are at the furthest end of risk, the most illiquid, and so the last to pump with the euphoric gasps of a dying bull,” the former head of Ark Invest commented via Twitter. He considered the current state of the prices based on January 2022 NFT’s volumes.
NFT volumes & prices in Jan 2022 have been strong. Many say this shows how everything in crypto may not crash simultaneously again.
One could also say #NFTs are at the furthest end of risk, the most illiquid, and so the last to pump with the euphoric gasps of a dying bull. pic.twitter.com/9jW27gwG9s
— Chris Burniske (@cburniske) January 30, 2022
Burniske also quoted the euphoric gasps that Litecoin (LTC) posted in 2013 when its buying volumes skyrocketed, at the same time when Bitcoin (BTC) plummeted across the board.
He further added in a Twitter thread: “In 2017, BTC peaked in December, while $ETH peaked about a month later in January 2018. In 2021, we had BTC and ETH peaking, before alternative layer-1s, before NFTs… in Jan 2022?”
To conclude, the former Ark Invest’s leader said that if Bitcoin can prove bottom soon at the current stage, and there are no macroeconomic tussles that could hit heavily the price action that leads “to sell everything markets, we may be alright.”
NFT Volumes Nowadays
Recent data showed recently that NFT transactions in January were $6.89 billion as of writing. This means there’s a likelihood that it could cross the $7 billion mark before the end of the day.
As FXEmpire reported recently, OpenSea remains the dominant force in the market, accounting for $4.21 billion of the total trades. But a worthy competition appears in the mold of LooksRare, which has $2.2 billion worth of transactions. Other notable performers include Solana-based Magic Eden, with $314.1 million.