What is fuelling NFT Craze on Ethereum?

4 min read | April 30, 2022 11:00 PM AEST | By Manu Shankar

Google News:

What is fuelling NFT Craze on Ethereum? — Image source: © Nexusplexus | Megapixl.com

Recent News

Franking Credits and Income Strategies Across ASX 200 Dividend Portfol...

Why Macquarie Sees Significant Upside In These Two ASX Shares

Why Do ASX 200 Banks Still Dominate Income Portfolios?

Why These ASX Shares Defied Market Weakness Today

Make Kalkine Media
My Trusted Source

Highlights

The Ethereum Name Service (ENS) has seen a significant rise of late.

The Eth domain name sales on OpenSea saw a massive spike of over 2,300%, with users queuing to purchase unique and coveted three and four-digit names.

The ENS has shot to US$3 million between 22 April and 27 April from US$700,000 from 14-21 April, as per its developers.

When the non-fungible tokens (NFTs) boom happened last year, Ethereum was one of the most preferred platforms chosen by the developers. Many joined the NFTs because of craze, few for the fear of missing out.

Many experts believe that going forward NFTs could rule the roost on Ethereum Network, resulting in congestion of the network. So, it was not a surprise when Ethereum attracted a significant number of institutional investments on the back of the NFT boom.

With other blockchain networks, such as Solana offering a better and more cost-effective way to develop NFTs than Ethereum, its market dominance in the space showed signs of retrace. The daily sales have seen a drop from US$160 million in January to $38 million in April, as of 29 April according to NFT tracker NonFungible.

Also read: Project Galaxy (GAL) crypto: Is it really unique as it claims?

As the overall sales figures are disappointing, the demand for Ethereum domain sales seems to be presenting a contradictory figure. The Ethereum Name Service (ENS) has seen a significant rise of late. ENS is primarily the domain name provider for the Ethereum blockchain The Eth domain name sales on OpenSea saw a massive spike of over 2,300%, with users queuing up to purchase unique and coveted three and four-digit names.

What do the numbers indicate?

Lead ENS developer nick.eth said the ENS has shot to US$3 million between 22 April and 27 April from US$700,000 from 14-21 April. In the last one week, the ENS domain registrations saw a significant rise of over 119%, with the total number of active .eth names rising by 7%.

Unique and coveted .eth names are selling at astronomical prices, with three-digit ENS names requiring six Ethereum tokens each. In fact, nick.eth pointed out that some of the users are buying ENS names, such as 887.eth for US$26000, 555.eth was sold for US$160,000.

Also read: Will Mexico be next El Salvador in accepting Bitcoin as legal tender?

Celebrity endorsement

The .eth sales have also been buoyed by celebrity endorsement. The primary example is Ethereum co-founder Vitalik Buterin, who has his id as vitalik.eth. Some of the big names include Paris Hilton, Coinbase CEO Brian Armstrong, Jimmy Fallon, etc.

The ENS sales bode well for the NFT sector, considering the ENS has been garnering a massive 446 Ethereum, or about US$1.3 million, in secondary sales on NFT marketplace OpenSea. With the NFT market expected to reach US$800 billion in the next two years, the growth in the space may perhaps also help in pushing Ethereum to the next level.

Though the numbers look good, one must also be wary of the constant changes in the crypto market, along with the volatility factor. Market participants should move ahead with caution and conduct market research before making investment decisions.

Risk Disclosure: Trading in cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory, or political events. The laws that apply to crypto products (and how a particular crypto product is regulated) may change. Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading in the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed. Kalkine Media cannot and does not represent or guarantee that any of the information/data available here is accurate, reliable, current, complete or appropriate for your needs. Kalkine Media will not accept liability for any loss or damage as a result of your trading or your reliance on the information shared on this website.

Disclaimer

The content, including but not limited to any articles, news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations and video (Content) is a service of Kalkine Media Pty Ltd (Kalkine Media, we or us), ACN 629 651 672 and is available for personal and non-commercial use only. The principal purpose of the Content is to educate and inform. The Content does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the Content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stocks of the company(s) or engage in any investment activity under discussion. Kalkine Media is neither licensed nor qualified to provide investment advice through this platform. Users should make their own enquiries about any investments and Kalkine Media strongly suggests the users to seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice), as necessary. Kalkine Media hereby disclaims any and all the liabilities to any user for any direct, indirect, implied, punitive, special, incidental or other consequential damages arising from any use of the Content on this website, which is provided without warranties. The views expressed in the Content by the guests, if any, are their own and do not necessarily represent the views or opinions of Kalkine Media. Some of the images/music that may be used on this website are copyright to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed/music used on this website unless stated otherwise. The images/music that may be used on this website are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated as or found to be necessary.