NFT Market Experiences Significant Decline Amid Ether Price Drop

According to Cointelegraph, the non-fungible token (NFT) market has experienced a substantial loss in value, shedding over $1.2 billion in less than a week. This downturn coincides with a slowdown in Ether's rally, as sector data reveals. On Monday, NFT Price Floor data indicated that the total valuations of NFT collections fell to $8.1 billion, marking a 12% decrease from last Wednesday's market cap of $9.3 billion, which had previously surged by 40% since July. The sharp decline in NFT valuations aligns with a 9% drop in Ether (ETH) prices. At the time of reporting, Cointelegraph data showed ETH trading at $4,260, down from a peak of approximately $4,700 on Wednesday. Many NFTs are minted on the Ethereum network, and their valuations and sales are often denominated in ETH. Consequently, fluctuations in the crypto asset's value can significantly impact the NFT sector. As ETH decreased by 4% in the last 24 hours, most of the top 10 NFT collections also experienced a decline in value. CryptoPunks, which remains the leading collection by market capitalization, saw its value diminish by about $300 million. At the time of writing, the collection's market cap stood at $2.1 billion, reflecting a 12% decrease from its previous valuation of $2.4 billion on Wednesday. Data from CryptoSlam shows that the collection's sales volume reached $12.7 million, representing a 34% drop over the past seven days. Total sales amounted to 51, down 28% from the previous week. The Bored Ape Yacht Club (BAYC), previously ranked second in overall NFT market capitalization last Wednesday, fell to third place on Monday as its market cap declined to $482.3 million. This represents a nearly 20% drop compared to Wednesday's valuation of $602 million. Meanwhile, Pudgy Penguins climbed to the second-highest valuation despite losing around $100 million in overall value. On Monday, the collection's market cap reached $491 million, a 17% decrease from Wednesday's $591 million. Last week, BTCS Inc., a publicly-traded blockchain company, announced the addition of three Pudgy Penguins NFTs to its corporate digital asset treasury. This move indicates that companies are beginning to recognize blue-chip NFT collections as legitimate assets for treasury diversification.