As the cryptocurrency market braces for potential disruptions amid ongoing tariff disputes, the NFT sector appears to be faring even worse.
Trading volumes are on the decline, and numerous marketplaces are shutting their doors.
The previously celebrated realm of non-fungible tokens, which experts had once confidently predicted could soar to over $264 billion by 2032, now seems to be struggling. Weekly trading figures have been consistently dropping, discouraging investment and pulling the market back to figures not witnessed since its explosive entrance in 2020.
According to blockchain analytics firm DappRadar, trading volumes in 2021 peaked at nearly $3 billion.
Fast forward to early 2025, and that number has plummeted by 93% to a mere $23.8 million, as “active traders have disappeared,” observed blockchain analyst Sara Gherghelas.
“This rapid expansion coincided with global changes spurred by the COVID-19 pandemic, which accelerated the adoption of digital platforms and prompted artists to seek new ways to connect with their audiences. However, three years later, the excitement surrounding Art NFTs has greatly diminished.”
Sara Gherghelas
The statistics confirm her observations. In 2024, trading volumes fell nearly 20% compared to the previous year, while total sales decreased by 18%. As Gherghelas stated in her 2025 report, it was “one of the poorest-performing years since 2020.”
Still seen as speculative assets
In a discussion on the state of NFTs, legal officer Alice Frei from OutsetPR pointed out that regulation remains chaotic, as “governments have yet to decide on how to categorize NFTs.”
In the United States, NFTs are frequently treated as securities, necessitating that platforms navigate a complex legal landscape. In the U.K., they are viewed more as collectibles under intellectual property law.
“These are instances from leading nations with clear cryptocurrency regulations; many other countries face even greater uncertainty. This lack of regulatory clarity fosters an environment conducive to fraud and undermines investor confidence. Until a more consistent framework emerges, NFT adoption will remain stagnant.”
Alice Frei
Frei also remarked on a fundamental issue: beyond the realms of cryptocurrency and gaming, NFTs are still “struggling to demonstrate their real value.”
“In theory, they could revolutionize various industries—imagine concert tickets that thwart scalping, digital IDs for online verification, or property deeds stored on the blockchain. Yet, in reality, most NFTs remain largely speculative assets.”
Alice Frei
In the gaming sector, where NFTs have significant potential for mainstream integration, adoption is also faltering. Frei noted that Ubisoft’s Project Quartz, which aimed to incorporate NFTs into major games, faced “resistance from players, leading the company to discontinue it.”
According to Frei, gamers are “wary of digital assets that seem more like currency than a true enhancement to their gameplay experience.”
A revolving door
If the outlook wasn’t grim enough, March brought more troubling news: several marketplace closures added to the dire situation. Notably, South Korean tech leader LG shut down its LG Art Lab, created just three years ago during the NFT craze. The company did not provide specific reasons, only stating that “it is the right time to shift our focus and explore new opportunities.”
Shortly thereafter, X2Y2—once a competitor to OpenSea with a lifetime volume of $5.6 billion—also closed its doors, citing a “90% drop in NFT trading volume from its 2021 peak” and challenges in maintaining competitiveness within the industry.
Additionally, Bybit, a cryptocurrency exchange still recovering from a $1.46 billion theft associated with North Korean hackers, quietly closed its platform. Emily Bao, Bybit’s head of web3, stated that this decision would enable the company to “enhance the overall user experience while focusing on the next generation of blockchain-enabled solutions.”
Frei described the current NFT market as feeling like a “revolving door.”
“Take Bored Ape Yacht Club, for instance—once a hallmark of NFT prominence, its prices have plummeted dramatically. At its peak, a single Bored Ape commanded $400,000; now, some are barely selling for $50,000. The core issue is that many NFT projects rely on hype rather than tangible utility. If individuals cannot see long-term value, they are unlikely to engage again.”
Alice Frei
A final glimmer of hope
Coinbase also appears to be pulling back. While it hasn’t officially closed its NFT platform, indications suggest it is diverting its focus elsewhere. During an earnings call in early 2023, President and COO Emilie Choi noted that the company perceives “medium and long-term opportunities” in NFTs, but its primary interest seems to lie with Base, its layer-2 blockchain network.
Coinbase has chosen not to comment on its current NFT position despite multiple requests.
The OutsetPR legal officer believes that, given the current trajectory of the market, smaller platforms will struggle to survive. “These smaller platforms will continue to close, leaving only a handful of dominant players like OpenSea and Blur,” she suggested.
She explained that this trend is being propelled by two main forces. First, stricter regulations are on the horizon, which may signal the end of the “Wild West era of NFTs.” Second, while the gaming industry might offer NFTs a lifeline, that opportunity is still quite limited. Frei expressed, “Gaming may represent NFTs’ last hope,” but developers must avoid “pay-to-win models that could alienate players.”
“The hype is gone. For NFTs to endure, they must demonstrate that they provide more than just costly digital images on the blockchain,” Frei concluded.