NFT Market Plummets 63% Amid Crypto Volatility AI Projects Shine
1min read The non-fungible token (NFT) market has experienced a significant downturn since December, with trading volumes plummeting by 63%. This decline is particularly evident in February, where trading volumes dropped by 50% from January, reaching $498 million. The overall decrease in nft trading volumes is closely tied to the broader volatility in the cryptocurrency market, which saw its market capitalization peak at $3.71 trillion on December 9, 2024.
Despite the overall decline, certain segments of the NFT market have shown resilience. Profile picture (PFP) NFTs remained the most popular category, generating $243 million in trading volume across 76,385 sales. Gaming NFTs followed with $41 million in volume and 421,853 assets traded, while sports NFTs led in terms of total sales count with 659,097 transactions, though at a lower volume of $7.7 million.
One of the bright spots in the NFT landscape is the growing integration with artificial intelligence. AI-powered NFTs are gaining popularity due to their dynamic and interactive features, which offer enhanced utility. Kaito Genesis, an AI-driven collection by digital asset search engine Kaito AI, saw significant growth in February. Its floor price reached an all-time high of 7.65 ETH, driven by strategic collaborations including a partnership with the Azuki NFT team.
Another notable project is Tokenized Collectibles by Courtyard, which bridges physical collectibles with digital assets by storing real-world items in secure vaults and minting them as NFTs on the Polygon blockchain. Dobby Fingerprints also emerged as a top collection by the number of traders, introducing a novel approach that allows NFT holders to claim fingerprint keys within Dobby, described as the “world’s first Loyal AI model.”
The broader Web3 landscape also faced challenges in February. DeFi (decentralized finance) saw its total value locked drop from $217 billion to $168 billion as capital flowed out of major platforms. February also marked a dark milestone for crypto security, with a record-breaking $1.5 billion stolen through hacks, primarily from the Bybit exchange breach, making it the largest DeFi exploit in history.
Despite these setbacks, AI 