Global non-fungible token ($NFT) The sector’s market capitalization fell below $1.5 billion, returning to levels before the sector’s rapid expansion in 2021.
According to data from CoinGecko, the retracement unfolded alongside a broader downturn in crypto markets over the past two weeks. On January 23rd, the market capitalization of cryptocurrencies was approximately $3.1 trillion, but by Friday it had fallen to $2.2 trillion.
Major assets such as Bitcoin (BTC) fell from about $89,000 to about $65,000, and Ether (ETH) fell from $3,000 to nearly $1,800 over the same period. Bitcoin and Ethereum are the top two networks for NFTs in terms of 30-day trading volume, according to $NFT Data aggregator CryptoSlam.
of $NFT The decline in market capitalization following several high-profile closures and exits highlights the sector’s continued contraction.
total $NFT Market capitalization chart. Source: CoinGecko
Increased supply collides with decreased demand
The market reset is $NFT supply and buyer demand.
As reported by Cointelegraph on December 31st, the total $NFT Supply continued to expand even as sales and prices fell, and the sector moved to a high-volume, low-price structure.
According to CryptoSlam data, the number of NFTs in circulation grew to nearly 1.3 billion in 2025, a 25% increase compared to 2024. $NFT Sales were down 37% year over year to $5.6 billion, and the average selling price was below $100.
This divergence suggests that while mint prices have become cheaper and barriers to issuance have lowered, buyer participation and spending has not kept pace.
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Corporate exits and platform closures add to pressure
The decline followed a series of high-profile declines that reflected market pullbacks. On January 7, footwear giant Nike quietly sold RTFKT, the digital collectibles studio it acquired during the pandemic. $NFT boom.
The reported sale followed the company’s decision to suspend operations amid investor litigation.
Additionally, market closures are accelerating. Nifty Gateway, one of the earliest gateways $NFT The platform announced on February 23 that it had shut down and entered withdrawal-only mode. The Gemini-owned platform cited the long-term market downturn as coming to an end.
January 28th, Social $NFT Platform Rodeo has announced that it will cease operations due to failure to scale sustainably. Rodeo said it will move to read-only mode before shutting down permanently in March.
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