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After a sluggish March, the NFT market has rebounded, with first-quarter trading exceeding $12 billion

Despite a drop in activity last month, OpenSea daily trading volume is increasing, and the market had a strong first quarter.

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After establishing new highs in January, the NFT market suffered a slow fall in trade activity in February, which continued into March. However, recent data suggests that NFT trading has been on the rise recently, with total trading volume exceeding $12 billion in Q1 2022.

According to DappRadar, the overall NFT market achieved $2.63 billion in total trading volume across all platforms in March. In February, the figure was $3.87 billion, while in January, it was $5.63 billion.

Overall, the NFT market trading volume for the first quarter of 2022 is estimated to be over $12.13 billion. Given that the overall market generated $25 billion in trading volume in 2021, according to DappRadar, 2022 might see a significant year-over-year rise if the market continues to grow at this rate.

Throughout February and early March, daily trading volume on the largest marketplace OpenSea (through Dune Analytics) decreased considerably. However, it has been steadily increasing over the last two weeks, and OpenSea’s largest single day of Ethereum trading volume in weeks occurred on Sunday (April 3), with $173 million worth of transactions. The platform has already seen $669 million in Ethereum volume in April.

Source: Dune Analytics

According to DappRadar, a total of 27.7 million NFTs were exchanged across platforms in the first quarter of 2022. Interestingly, the number of NFTs sold each month did not diminish at the same rate as trading volume, falling from 11.3 million in January to over 7 million in March, a 38 percent drop compared to a 55 percent drop in monthly trading volume.

“Volumes are down significantly from January’s highs,” Pedro Hererra, senior data analyst at DappRadar, explained. “However, the number of deals and unique traders is growing, indicating that demand for NFTs is high and that the market is developing.” “We’re also seeing more activity in blockchains that aren’t labeled Ethereum, such as Avalanche and Solana,” he added.

DappRadar’s statistic only includes “organic” volume, leaving out suspicious behavior on LooksRare, an Ethereum-based marketplace where “wash trading,” or the swapping of NFTs for substantially inflated sums back and forth between the same wallets, has been widespread. LooksRare rewards tokens and some traders have attempted to game the system by selling NFTs between various managed wallets for up to $50 million in ETH in each direction.

LooksRare has generated more than $8 billion in wash trade in less than a month, according to analytics firm CryptoSlam, which told Decrypt in January. Around 87 percent of LooksRare deals were considered manipulative or non-organic at the time.

According to a Bloomberg report from yesterday, CryptoSlam now estimates that the overall number of LooksRare wash deals is at 95 percent. According to DappRadar, LooksRare had around $19.7 billion in transaction volume until the end of March.

According to CryptoSlam data, the greatest NFT schemes in March included the Bored Ape Yacht Club, which saw over $227 million in trade activity as a result of the ApeCoin hype (APE). In March, the Mutant Ape Yacht Club had a trading volume of about $106 million, while upstart project Azuki had a trading volume of nearly $155 million.

In the end, Herrera feels that, despite the low figures in March, the data shows that NFT purchasers are becoming savvier and that projects perceived as scams or cash grabs are having less of an influence as the industry matures.

“There are NFT collectors who have been in the sector for over a year and are now sophisticated enough to discern excellent projects from bad,” Herrera said, adding that newcomers to the market have also swiftly learned from high-profile “fiascos.”

“Overall, the market is consolidating and poised for a fantastic year,” he said.

NFT

According to Music Ally, Spotify has begun testing NFTs on its platform

If a trial deployment goes well, artists may soon be allowed to market their non-fungible tokens (NFTs) on Spotify, according to Music Ally.

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Spotify, the most recent tech business to join the NFT bandwagon, entered the web3 world earlier this month with the introduction of “Spotify Island” on Roblox on May 3. Spotify will now test NFTs on the platform to specifically selected US consumers, starting with a single trial selection of artists, including Steve Aoki and The Wombats.

Users will have to purchase NFTs through an external marketplace, thus they won’t be able to sell them directly. As part of the trial, Spotify has stated that it will not take a portion of the sales.

Simultaneously, customers have stated that Spotify is sending out surveys and even paying some people to talk to team members about their feelings regarding NFTs and web3. Questions concerning sentiment, cryptocurrency purchases, and why people acquired NFTs have been circulated on Twitter. Some poster responded with mockery to the queries.

Since March, when Spotify placed two job offers for working on early-stage web3 projects, rumors have circulated that the firm was interested in entering the web3. The announcement comes only days after Meta revealed that it would begin testing digital collectibles and NFTs on Instagram as well.

By the time of publication, Spotify had not responded to a request for comment from The Block.

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Square Enix intends to issue tokens and make a significant investment in Web3 gaming

By investing in blockchain gaming infrastructure, the big game producer is altering its business strategy to include a stronger NFT environment.

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Square Enix announced in its first-quarter results report that as part of its medium-term business strategy in 2022, it will include nonfungible tokens (NFTs) into more game goods.

According to Square Enix’s most recent earnings report, the company manages $3 billion in assets. The company controls the Final Fantasy franchise, which it sold for $300 million on May 3rd.

According to the report, the company began testing NFTs in February this year on the Shi-San-Sei Million Arthur game. If the pilot program is a success, the game’s NFTs will be renewed for a second season, and the company will expand its NFT and blockchain activities.

SE wants to provide regulatory clarity and norms for blockchain gaming, address scalability in NFT economies, and consider forming a corporate capital venture unit, among the top priorities of its blockchain domain projects.

The company also announced that it intends to create an overseas organization that will be responsible for “issue, administering, and investing our own tokens,” implying that the company will begin to build a large gaming-token economy.

SE has been exploring its options in the blockchain gaming market with the help of Web3 gaming and metaverse venture capital firm Animoca Brands. As SE digs deeper into the ecosystem, collaboration between the two companies is expected to deepen.

Square Enix’s gaming clout, according to Animoca’s executive chairman Yat Siu, will only help the company establish a blockchain gaming presence. On Monday, he said to Cointelegraph,

“Square Enix has long talked about the possibilities of blockchain games, so it understands it better than most of the traditional gaming titans.”

The third objective of the report’s medium-term business strategy is to invest in and monetize blockchain, artificial intelligence (AI), and cloud computing. This aligns with CEO Yosuke Matsuda’s stated desire in January to increase his company’s involvement in such technologies.

Despite a broad cryptocurrency market dip in 2022, the appeal of Web3 and NFT gaming has remained strong. On Saturday, according to market tracker DappRader, there were roughly one million daily active gamers, nearly the same as on January 1.

Gamers, on the other hand, aren’t spending as much as they used to, with total sales volume for NFT game items falling 88 percent from $70 on January 1 to $8.7 million on Saturday.

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Ukraine’s Ministry of Digital Transformation has approved a charity NFT initiative to aid military operations

On Thursday, Mykhailo Fedorov, Ukraine’s Vice Prime Minister and Minister of Digital Transformation, tweeted his support for Avatars for Ukraine, a non-fungible token (NFT) project that benefits Ukraine’s humanitarian and defense efforts.

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The project includes 70 digital artworks based on Ukrainian imagery and resistance to Russian forces that evolved as a result of the Russia-Ukraine war. All earnings from the sale of digital art go to support Ukrainian war efforts. The Ukrainian Ministry of Digital Transformation has approved Avatars for Ukraine, and the first NFT will be released on May 19.

This isn’t the first time Ukrainian officials have used blockchain technology to help fund war activities. The Ukrainian government opened a website in April this year where people could purchase and trade NFTs to support Ukraine’s military efforts, as well as raise over $100 million in crypto donations.

Avatars for Ukraine also joins a growing trend of NFT projects assisting in the donation of monies to charity, with some or all of the proceeds of NFT art going directly to the charity.

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