The cryptocurrency market has rebounded over the past few months from its bearish trends. The same cannot be said of the non-fungible token (NFT) market, as several projects in its ecosystem are experiencing downtrends in floor prices.
The floor price of an NFT is the lowest amount that the token can be sold in the secondary marketplace.
For example, Bored Ape Yacht Club (BAYC), the popular Ethereum-based NFT project developed by Yuga Labs, has slumped to 30.29 ETH (approximately $57,500) in its floor price. Although this amount may be high, it represents a 79% decrease from its all-time high of 153 ETH (currently worth over $290,000).
Why is BAYC Decreasing?
There is no definite reason why the BAYC NFT is experiencing downtrends. However, several factors exist that may have exacerbated the asset’s performance.
One is the over-dilution of the Yuga Labs ecosystem. After releasing the BAYC and its counterpart project, Mutant Ape Yacht Club (MAYC), in 2021, Yuga Labs spent time building around both projects. It was around that time the project unveiled its governance token, Apecoin, and the Otherside metaverse.
However, Yuga Labs gradually shifted from BAYC IP and launched another NFT franchise in December dubbed HV-MTL. Because the growing HV-MTL ecosystem has no direct connection to the BAYC NFT, users believe that the Labs’ developers may be retracting attention from its flagship product and giving it to newer products.
Another factor that may have contributed to BAYC’s current downtrend is the action of NFT whales. A few back, Machi Big Brother, an NFT whale with a massive number of BAYC tokens in his portfolio, sold over 50 BAYC NFTs on the digital marketplace, Blur.
Usually, a mass sale of a particular asset often leads to a decrease in the underlying asset’s value for some time. However, BAYC’s poor performance continues.
Other NFT Projects See Decreases
Aside from BAYC, other top NFT projects are experiencing downtrends. MAYC is one of them, as it is down to 5.6 ETH, which is an 86% decrease from its ATH.
CryptoPunks, Azuki, Otherdeeds, DeGods, and others are also significantly down from their all-time high.
