CRYPTONAIRE
WEEKLY CRYPTO investment journal
Silent crash’ as price floors collapse across NFT space
Prices are plummeting, and some holders might not even know it If prices plummet in an illiquid market, how soon before anyone notices? While fungible tokens traded on centralized and decentralized exchanges have significant transparency regarding price movements, nonfungible tokens can be harder to track. Because of their illiquid nature, gauging the sentiment of the overall market for a project can be difficult — a dynamic that has led one eGirl Capital member, Mewny, to dub NFT corrections ‘silent crashes.’ In a silent crash, speculators might not even be aware that one is underway — buyers simply evaporate and sellers fail to move their wares. However, metrics such as “floor price” — the lowest price at which a NFT can be bought for a particular project — as well as total volume can indicate that a bull is turning into a bear. There could be bad news on the horizon for NFT collectors, too, as signs are pointing to a nasty silent crash underway. CryptoPunks, among the earliest and most popular NFT projects for collectors, have seen a over 40% decrease in floor price to 14 ETH (roughly $28,000 at the time of publication). The price capitulation has led to some on-chain horror stories today, such as one speculator who sold a Punk for 16 ETH after purchasing it for 25.5, and another that sold for 27.99 after a 42 ETH purchase: Read more...
Cryptonaire Weekly | April 6th 2021
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