The collapse of Silicon Valley Bank (SVB), the largest banking failure since the 2008 financial crisis, has significantly impacted the non-fungible token (NFT) space. According to a recent report by DappRadar, NFT traders have become “numb” in response to the banking turmoil in the United States.
NFT Trading Volume and Sales Count Fall
The NFT industry had been steadily upward for most of 2023. However, since the beginning of March, the NFT trading volume has dropped by 51%, and the sales count has fallen by nearly 16%. The number of NFT traders has also decreased significantly, with only 12,000 traders recorded on March 11th, the lowest level since November 2021.
Traders Question the Stability of Stablecoins
DappRadar reported that NFT traders are becoming less active as market participants question the stability of stablecoins. The de-pegging of one of the largest stablecoins, USDC, was felt in the NFT market. Traders are becoming cautious, and the lowest single-day trade count in 2023 was recorded on March 11th, with only 33,112 trades.
Blue-Chip NFTs Remain Resilient
Despite the low NFT trader activity, the data aggregation platform stated that the volume was unaffected in the same ratio. Blue-chip NFTs, including Bored Ape Yacht Club (BAYC) and CryptoPunks, remained resilient throughout the event. The floor prices of these NFTs were hardly affected, with figures recovering quickly after a minor dip below $100,000 on March 11th. Other blue-chip collections, such as Azuki and Art Blocks, were also not harmed.
Moonbirds and Proof Ecosystem Hit Hard
Moonbirds and the Proof ecosystem were hit hard due to their exposure to the Silicon Valley Bank. Moonbirds lost 18% of its value since the news unfolded, but the floor price has since recovered, climbing to $6,207 (nearly 4 ETH). Proof had earlier stated that the potential loss arising from the Silicon Valley Bank collapse would not affect the security of the customer’s assets or the project’s roadmap.