The NFTs market has outperformed the cryptocurrency market. In comparison to the overall crypto market NFTs performed admirably in Q1 2022, though not all were winners
NFTs Market Outperforms Crypto in Q1 2022
Nansen’s quarterly report on non-fungible tokens is now available. In comparison to the overall crypto market, NFTs market performed admirably in Q1 2022, though not all were winners.
Nansen, a blockchain analytics platform, published its 2022 quarterly NFT report today, which was preceded by the firm’s indexing methodology, which was formalized in January.
The firm launched its NFT market (NFT-500) fund in February, which would track the broader NFT market as well as the Blue Chip-10, Social-100, Game-50, Art-20, and Metaverse-20.
As evidenced by the NFT-500 Index’s price appreciation of 49.9 percent in 2022 when denominated in Ethereum, the non-fungible token market has outperformed the broader cryptocurrency market’s performance year to date.
NFT Market Not Immune To Crypto Market’s Overall Correction
Nonetheless, the report noted that the NFT market was not immune to the crypto market’s overall correction that began in February of last year, but that downtrend appeared to reverse in the last month, with the NFT-500 rising 5.9 percent in March.
The various segments (and corresponding indices) of the NFT market produced disparate results. The Metaverse-20 index grew by 129.4 percent in Q1 (in ETH), while the growth of the gaming and art NFT sectors slowed.
The Gaming-50 index was the worst-performing NFT sector tracked by Nansen, owing primarily to declines in Play-to-Earn and Role Playing Game NFTs. The decline in the Art-20 index was primarily attributed to a drop in prices for Generative Art NFTs.
In terms of volatility, the various NFT sectors differed greatly. The most volatile were Metaverse NFTs, while the least volatile were Blue Chip NFTs, to which Nansen recently added Azuki, Clone X, and Doodles.
Louisa Choe, a research analyst at Nansen, stated:
“The NFT segment of the cryptocurrency market is fast-growing and dynamic and has proved to resonate with retail investors over the past year, with significant growth in Q1 of 2022. As more artists, creators, builders, and community members innovate with the NFT market we believe we will see a rebalancing of which sectors become its driving force.”
NFTs outperformed the rest of the cryptocurrency market in Q1 and were “relatively uncorrelated” to other crypto assets.