The non-fungible token (NFT) market valuation has plunged over the past week, wiping out billions from the sector.
According to CoinGecko, the global NFT market cap dropped to $6.77 billion, a 6.2% decline from its recent high of $8.22 billion on Wednesday—representing a $1.47 billion loss.
However, trading activity has not slowed. Instead, trading volume surged to $11.616 million, a 14.3% increase at press time. Historically, a divergence between declining prices and rising volume suggests the market is set for further downside.
Market data shows certain outliers recorded gains, such as Cool Cats with a 12% increase, while most of the top 10 tokens in this category barely moved. The majority of the decline occurred on the Ethereum chain as its native token, Ether, failed to sustain new highs.
Data from Artemis indicates that the NFT sector underperformed in the past seven days, posting an 8% decline—ranking last among the 23 tracked market sectors.
Ethereum Weakness Drags Market
The drop in NFT valuations followed Ethereum’s failure to maintain bullish momentum that had pushed the asset to $4,793, near its all-time high, after a 22% gain in the past 30 days.
CoinGecko data shows Ether has since slipped to $4,350 as bearish pressure builds, directly weighing on NFT floor prices.
A major contributor to the decline was the significant outflow from Ether spot exchange-traded funds (ETFs). Institutional investors sold $59 million worth of Ethereum on August 15—the first major sell-off since August 4, when $465.1 million exited the market per CoinGlass.
Continued institutional selling could further dampen ETH’s price, dragging NFT valuations lower as well. Other ERC-20 tokens also faced setbacks as the broader crypto market fell 3.31% to $3.89 trillion in market capitalization.
Losses Remain Contained—For Now
Despite the downturn, losses remain relatively minimal for top NFT collections. CryptoPunks, which represent 32% of the total market share, recorded only a 1% dip, with its floor price trading around $212,823.
Meanwhile, Pudgy Penguins and Bored Ape Yacht Club (BAYC)—which together hold 14% of the market share—fell by 6.6%, with floor prices at $55,621 and $48,216, respectively.
Still, if these top three NFTs experience steeper declines, liquidity outflows could accelerate, and further losses across the market may follow as investors absorb the hit.
