The Non-Fungible Token (NFT) market has seen tremendous growth in recent years, with many investors and artists flocking to the space to create and trade unique digital assets. However, there have been recent concerns about the viability of NFTs on the Polygon chain, a popular Ethereum Layer-2 scaling solution. Some have even suggested that NFTs on Polygon may be “dead.”
Polygon, formerly known as Matic, is a Layer-2 scaling solution that aims to make Ethereum more efficient and affordable by increasing transaction speed and reducing gas fees. It has become a popular choice for NFT creators and traders due to its low fees and fast transaction times.
Polygon NFT marketplace observes almost no growth
Polygon NFTs failed to take off in Q2 and Q4 of last year due to the crypto market’s contagion, thanks to Three Arrows Capital and FTX. However, even after the market recovered in recent months, Polygon’s situation remained unchanged, even as its competitors experienced growth.
While the NFT space is supposed to be changing, Polygon NFTs should be aware of any increase in demand. Initially, this was linked to the larger narrative of minimum use cases presented by NFTs, but this has evolved in recent months. The financialization of NFTs has enabled non-fungible token holders to use their NFT(s) as collateral for loans, providing owners with liquidity.
This increased the trade volume on the Ethereum and Solana NFT platforms. Blur on Ethereum and TensorSwap on Solana have seen the most rise in volume over the last six months. Only Opensea reported modest growth on Polygon.
This is because of two factors. One is the general decline in crypto market conditions prior to the January rise. Two, there aren’t enough traders on Polygon’s NFT marketplace.
The influence of the latter factor ultimately suppressed the bullishness observed between January and March. However, Polygon’s MATIC transactions and network use improved during the same time frame, indicating that the broader market effect had nothing to do with NFT markets remaining subdued.
Several NFT marketplaces sales surge
Despite the fact that the Ethereum blockchain remains by far the most popular choice for minting non-fungible tokens (NFT), other layer 1 blockchains and layer 2 networks have recently seen modest increases in NFT sales.
CryptoSlam data indicates that layer 1 blockchain Cardano, whose token is ADA, briefly surpassed Ethereum scaling platform Polygon as the fourth-most popular blockchain by NFT sales volume.
According to CryptoSlam, as of Tuesday afternoon, Cardano had fallen to sixth place, behind BNB and Polygon, although its 24-hour sales had increased by 86%. CNFT.io reports that trading volume for Goofy Gophers and Spacebudz has exceeded 185,000 ADA (approximately $70,000) over the past 24 hours.
The sales volume of other blockchains, including Solana (SOL), has increased over the past week. On April 22, Solana saw an increase in sales, unique buyers, and unique sellers, primarily due to the release of Mad Lads, which was in such high demand that its minting had to be delayed.
According to Crypto Slam, the mad rush for the Mad Lads contributed over $8 million to the $9.9 million in sales on April 22 – a level not seen since January. Over the past week, Solana’s sales volume has increased by 129%.
In the meantime, NFT enthusiasts are worried that Polygon’s sales volume is taking a turn for the worst. It appears that their concerns are grounded on the fact that NFT collection y00ts recently moved from Solana to Polygon.
Despite these concerns, some experts believe that NFTs on Polygon are far from dead. They point to the continued growth of the Polygon network and the many projects and initiatives being developed on the chain. Additionally, they suggest that the recent downturn in NFT sales may be a temporary blip, rather than a long-term trend.
While there have been concerns about the viability of NFTs on the Polygon chain, it is too early to declare them “dead.” The market for NFTs, like all markets, is subject to fluctuations and volatility. However, the long-term potential of NFTs and the Polygon network remains strong, and we can expect to see continued growth and innovation in the space in the months and years to come.
