“NFT Market Experiences Significant Dip as AI Becomes Fastest Growing Sector”

Since December, the market for non-fungible tokens (NFTs) has experienced a significant decline, while AI-driven dApps have continued to grow. It has also become the fastest-growing sector within Web3.

The NFT trading volume has dropped by 63% in two months, according to the DappRadar Industry Report on March 6. In December last year, $1.36 million worth of NFTs were traded, but this has now dropped to $997 million in January and then $498 million in February. Moreover, the number of NFT sales in February decreased by 16%, indicating a weakening market.

However, some collections continued to perform despite the broader downward trend. Sales of Pudgy Penguins increased by 25%, despite price drops. Doodles, another popular NFT collection, made headlines with the announcement of the Solana-based DOOD token.

AI-driven NFT collections, such as Kaito Genesis, grew rapidly at the same time. The floor price of this collection reached 7.65 ETH after a collaboration with Azuki.

According to the DappRadar Industry Report, AI dApps are currently the fastest-growing Web3 category, with the number of unique active wallets in February skyrocketing. LOL grew by 5.1 million users while Evermoon experienced explosive growth of 988%. AI-generated content is also growing rapidly, with Fractal Visions seeing a 721% increase in adoption.

DeFi also struggles alongside NFTs

Like the NFT market, the decentralized finance sector (DeFi) has also experienced a significant decline. The total locked value (TVL) dropped from $217 billion in January to $168 billion in February.

The TVL in Ethereum dropped by 27% to $97 billion due to a decrease in liquid staking activity. However, the largest drop was seen in Solana (SOL), where the TVL dropped by 33% to $15.4 billion. The reduced activity on Raydium and Jupiter was largely the reason for this decline.

Yet, some blockchains managed to grow. Despite the market dip, Berachain achieved a TVL of $5.05 billion, while Aptos saw a 6% increase, bringing the TVL to $1.83 billion.