Now it’s official: the summer downturn in the cryptocurrency market is over. According to Coinmarketrate.com , the crypto market, and above all, Bitcoin has shown impressive bullish growth. The key cryptocurrency grew by about 6.4 percent daily. According to calculations for the week, investors even expect growth of 32 percent.
In absolute terms, the price increase is even more impressive. Finally, yesterday at noon from 11 to 14 o’clock, BTC began a rally during which the price rose from 50,500 to slightly under 55,000 USD – an increase of 5,000 USD in a few hours. For comparison: in April 2019, the cryptocurrency was still trading at around $5,000.
Thanks to Bull Run, BTC has become a “trillion dollar asset” again. The market capitalization currently stands at about $1.031 trillion.
So, this is the famous Bitcoin volatility again. He is quoted again and again by critics of the cryptocurrency, as a deadly argument, but he will come in handy for hodlers: this 30 percent income in a few days is simply impressive!
In the context of the latest bullish movement, digital gold is also slowly approaching the historical maximum of $64,000, which was reached in April this year.
I lean back from the table for a while
“Flippening” has been a hotly debated topic lately, but it’s still a long way off these days because, unlike Bitcoin, altcoins are currently fading far into the background.
Ether (ETH), the Ethereum network’s own currency, tips the scales by only 1.2 percent in a 24-hour comparison. Binance Coin (BNB) is even losing value (albeit to a small extent), and is quoted with a daily minus of 0.1 percent.
The second leader after Bitcoin in the ranking of the top 10 coins is Polkadot (DOT) with an increase of 3 percent. At the moment, the flow of buyers is focused primarily on the market leader.
As a result, Bitcoin’s dominance is also making a good leap forward. With a market capitalization of $1 trillion, BTC at the time of writing accounts for about 44% of the entire cryptocurrency market.
The dominance of Bitcoin by market capitalization. Source: Tradingview.
It is also noticeable that the cryptocurrency market is developing in the opposite direction to the traditional financial sector. Because, unlike Bitcoin and Co, the stock market is more in correction mode these days. The S&P 500 index is falling, from its historic high of 4,545 points in September, and is currently at 4,363 points. The diagram image looks like this:
The S&P 500 stock index. Source: Tradingview
NFT also broke all records in the third quarter
But not only the BTC showed record results. Non-interchangeable tokens also successfully passed the third quarter, with a large scale and excitement.
The wave of hype about non-interchangeable tokens (NFT) simply does not want to stop. In the spring, it seemed that the euphoria around non-interchangeable tokens had subsided, but NFT is now more popular than ever. DappRadar estimates the market capitalization of the NFT market, plus the NBA, at $14.19 billion. The size of the NFT market varies depending on the source, because not all purchases are recorded in the blockchain. But most sizes are in the billions.
The Axie Infinity blockchain game is a particularly good example of the hype and success of NFT. Why the game? Yes, because it recorded a turnover of more than $2 billion for the first time.
Quarterly sales with NFT in US dollars (source: Reuters).
As can be seen from the graph above, NFT appeared on the cryptocurrency market only a few years ago. Few people knew what to do with the NFT token. In line with this, the trading volume in the third quarter of 2020 was still a modest $28 million.
Today, in the third quarter of 2021, things are very different: in just one year, sales of works of art, NFT increased by more than 38,000 percent. And from the second quarter of 2021 to the third, the trading volume increased by 9.4 billion US dollars.
Sale of NFT on OpenSea
The OpenSea platform has established itself as the largest and most important trading center for non-interchangeable tokens. The third quarter was the most successful for OpenSea in the company’s history: in August alone, the sales volume of the digital art marketplace amounted to 3.4 billion US dollars.
Then in September there was a slight decline in trading volume to 3 billion US dollars. However, this is still an impressively high amount. For comparison: Christie’s, one of the most traditional auction houses in the world, had a turnover of only 5.5 billion US dollars for the whole of 2020.
The increase in OpenSea sales from July alone ($326 million) to August ($3.4 billion) corresponds to an increase of 943 percent. What is even more impressive is that in January 2021, OpenSea earned more than $8 million.
A look at Google Trends can also provide interesting information about developments in the NFT market. So you can eventually see the volume of Google searches as an indicator showing how high the demand for NFT has been and remains.
The blue line represents the search query “NFT”. The red line was chosen for comparison and represents the volume of Ethereum search. It can be seen that the NFT was almost not requested until February 14. However, after that, the number of searches increased. On October 6, Ethereum and NFT search queries are almost at the same level.
The so-called CryptoPunks symbolize the growth and hype around NFT. “Punks”, limited to 10,000 copies, are now selling for hundreds of thousands, if not millions of dollars. According to CoinMarketCap, CryptoPunks represent the most valuable NFT collection in the world.
The following figure shows the price of CryptoPunks over the last 90 days. The average price on July 9 was 17.23 Ether (today 58,182.6 US dollars). For comparison, the price on October 6 is already 159.5 Ether, an average of 536,027.9 US dollars.
CryptoPunks, average price. Source: OpenSea
Website Nonfungible.com provides information about all aspects of NFT. The graph below shows the number of NFT units sold in the last 30 days. As of January 1, 30-day sales totaled 80,000 units. In particular, more NFTs were sold in the third quarter than ever before.
The number of products sold. Source: Nonfungible.com
The graph below shows the total amount of US dollars spent on NFT purchases. It is also obvious here that more US dollars were spent on NFT in the third quarter of 2021 than in any other quarter previously.
The cost of non-interchangeable tokens sold in US dollars. Source: Nonfungible.com
The number of active wallets was also at a record level on October 5. As of January 1, there are still 18,000 wallets with non-interchangeable tokens in the asset. On October 5, the total number of active wallets was already 155,000. Which corresponds to an increase of 761 percent. It is also clearly visible here: since August 2021, the number of active wallets has increased markedly.
The number of active wallets. Source: Nonfungible.com
NFT is cheaper than expected
Even if CryptoPunks gives the impression that everything on the NFT market is utopically expensive, Reuters comes to a different conclusion because, as shown in the following figure, most non-interchangeable tokens can be purchased at a price from 0 to 10,000 US dollars. Millions of expensive CryptoPunks or $69 million Beeple illustrations are the exception rather than the norm.
First of all, it should be noted that NFTs have never been as popular as in the third quarter of 2021. It remains to be seen whether this is a short-term hype, or whether the NFT market can really be valued at $1 trillion.