Celebrities’ favorite Bored Ape Yacht Club, NFT collection sees a steep decline over the last few days as the crypto market continues to crumble. The reasons behind the slump of the market are clear – the stock market is down and investors pull out of literally everything to show positive balance on their books. NFTs, at the same time, are designed to hold value. Not by design, of course, but by ideology. An asset costs whatever the last person bought it for, so the declining floor price of the pinnacle NFT collection that is the BAYC, may serve as a gauge for the whole industry.
Understanding that the floor price of a collection of NFTs is the lowest price, not the average price, is crucial, and it has just gone down. To put it another way, it’s the cheapest price for a single token from a collection of non-fungible tokens.
The NFT Index, which evaluates how non-fungible tokens have performed in the last 24 hours based on the circulating supply, has fallen about 23% during this timeframe.
DappRadar and CoinMarketCap research show that BAYC NFTs‘ average price decreased by 25% within the same time period. Millions of dollars have been spent on some of these tokens in the past few months.
These price declines are part of a larger cryptocurrency selloff sparked by unexpected inflation figures that reached a 40-year high on Friday.
What about crypto?
Bitcoin plunged by as much as 15.5%, striking an 18-month low and falling more than 50% from its all-time high in November. When the New York Stock Exchange closed, the price of bitcoin was approximately $23,500.
As a result of the market downturn, NFTs outperformed the crypto sector as a whole. In spite of their limited liquidity relative to fungible tokens like Bitcoin and Ether, investors have built sizeable NFT portfolios in the last six months.