We have to admit that the NFT market is not like other markets. It has rules (tendencies) that change all the time, which makes it a dynamic market.
Why does this happen? You will be interested in the nature of this space and how the founders and designers of NFT projects are always trying to change in order to make more money or become the next big project that everyone will be talking about.
As a result, this young market has gone through three distinct phases in the last year:
First expansion of the NFT (golden age): February 20, 2021
This time could be called the “Golden Age” because every collection that came out during this time made thousands of dollars, even though there were no clear trends or complicated marketing strategies. Instead, there was only FOMO and hype. Anyone could start an NFT collection and make money off of it. During this time, Yugalabs’s Bored Ape Yacht Club and RTFKT’s RTFKT, two big names in the NFT scene, were born. “We are a group run by creators. RTFKT makes one-of-a-kind shoes and digital artifacts by combining advanced game engines, non-fungible tokens, blockchain authentication, augmented reality, and manufacturing know-how.
During this time, P2E was also introduced. Due to high demand and limited supply, the price of an Axie Infinity squad went from $150 to $3000 during this time. This type of NFT got to its peak before falling apart because of a number of problems that caused people to lose money while playing.
In the end, the NFT market grew during a time of oversupply and FOMO, and the early adopters were the ones who benefited the most.
2nd stage
This was a transitional time because projects started using new ways to launch, market, and even make up stories for themselves as people got tired of investing in them. During this stage, there wasn’t as much fear of missing out (FOMO), and some projects that started in the previous stage either died or their founders moved on. Also, projects almost always started to include the well-known “NFT UTILITY,” which lost its value because there were too many of them (although well implemented it is actually a plus)
The fact that this was the first time it happened is important.
SOLANA SUMMER
This event was given its name by degens because the number of Tx and traded NFTs on the Solana blockchain went up by a lot. The Golden Age had come to Solana, but only for a short time.
Due to its low transaction fees and high transaction volume per second, the Solana SOL/USD blockchain is being used by a lot of projects. This helps avoid the gas wars that happen on the Ethereum ETH/USD blockchain. (Spoiler alert: More than three times this year, Solana’s blockchain has been reset.)
The same thing happened as with the previous stage: the market became oversaturated, and the projects were copied and pasted without much innovation from the founders. Several of them used the same launch and marketing strategies, so none of them stood out from the crowd.
This is how you get to the last stage
Current events: During this time, the NFT scene is dominated by projects like Bayc and RTFKT that put building first in the first stage. They were able to make an ecosystem centered on brands that fits the NFT market perfectly. Their ability to come up with new ideas and the way these two projects led the way in this market stand out. Whether it’s because of the Nike wearables on RTFKT or because of the Theotherside metaverse.
On the other hand, because of the NFT market’s history, founders started coming up with new ways to start their projects. In the last few months, GoblinTown was the place that made the most noise to get the attention of degens. The collection just showed up out of nowhere, without any marketing campaigns or endorsements. They put out a collection with no discord, no roadmap, and no cost for the collector’s edition. This caught the attention of a lot of users because it wasn’t something they did very often before that day (May 22nd, 2022). Goblintown.wtf set a trend in the industry with its unique design and minting method. Within a few hours, thousands of collections hit the market to try to copy its launch strategy and cash in on the buzz that happens when a collection has this kind of market impact.
There are three main points:
Goblintown holders could only talk to each other on Twitter because they didn’t have a Discord server. So, the project grew naturally because of the attention its holders got.
Due to market conditions (trade volume has been going down in recent months), the founder set the mint price to $0 so that anyone could mint and there was no barrier to entry; they only had to pay the gas fee.
They came up with a new way to run a business in which the founder’s main source of income is not the launch of the collection but the number of sales it brings in. On the other hand, if your collection isn’t very popular, it’s likely that you won’t sell many of them, which will put you in the red.
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