Step Data Insights - The State of Solana NFTs
A data oriented view of Solana NFTs and a look into the most relevant news of the week.
At the time of writing, the Solana market cap is $4.36 billion with a 24-hour volume of $166 million. The price of SOL is $11.88 and its market dominance is 0.54%. The Total Crypto Market Cap is $809B, up 0.13%. The NFT transaction volume surpassed 1,408,638 SOL, closing in on $16.6M in the last 7 days.
Introduction
Step’s previous newsletter marked the 1-month anniversary of the FTX crash. We covered the most updated on-chain data on the Solana DeFi ecosystem, which highlighted the pain endured by protocols, developers and users. While the DeFi ecosystem is taking a step back to reassess and rebuild, the Solana NFT ecosystem is at a much different stage. While data shows a slowdown in user activity metrics, the NFT market seems to be impermeable to the overall macro outlook. Innovation is booming, the majority of the community is united and supporting dialogue between the most prominent actors in the space.
Today we will be taking a look at the most recent NFT market data and later shift our attention to the most exciting project developments of the week.
Summary
SolanaFloor - SF Index
Core Solana NFT User Base is growing
Royalties
Sellers, Buyers & Traders
Relevant News
Biggest Sales of the Week
Cets on Creck - WTF is Laboog?
ABC Universe
$HADES Token
ABC All-Time-High
DeGods III
New Art
DeadGods Reveal Memories
Most traded collection ever
Magic Eden Royalty Solution
Dialect App Launch
Knittables Mint
SolanaFloor - SF Index
The SolanaFloor NFT Index consists of a carefully selected basket of Blue Chip collections based on multiple weighted criteria: volume, social trends, age and other statistics. This basket is reviewed monthly.
The SolanaFloor Chart presents the index in SOL (green) and in USD (purple).
The index in SOL terms is an incredibly valuable tool for any longterm NFT investor, trader or researcher. While Technical Analysis is arguably inaccurate for most NFT projects under 4 months of existence, this chart presents a big enough timeframe (Year-to-Date) for valid analysis.
Looking at this chart, one can draw Support and Resistance areas, as well as speculate on NFT cycles, given that bluechips drive the markets up and down. Studying the SF index, traders can leverage their SOL positions by timing their entries in bluechip NFTs.
USD INDEX
Today, the USD Index sits near all-time-low territory. It is not surprising, considering the brutal macro bear market we’re currently living. The Solana Token $SOL is down around 97% from its All-Time-High.
Since January, the index has been downtrending. At its highest, the index was valued at $12,400, driven by the DeGods, Blocksmith and SMB rise. The All-Time-Low of $685 occurred during the FTX crash in November, when fear and panic took over the ecosystem, placing most Bluechips at a 50%-70% discount. A month later, the Index is valued at $1,161.00, a 100% increase from monthly lows.
SOL INDEX
The SOL Index paints a completely different picture. It is clear that from a USD standpoint, this year has not been easy for any longterm investor looking to leverage their position using NFTs. However, it has been a great year for experienced traders to stack SOL.
The FTX crash was the catalyst to the most aggressive bull run for Solana NFTs, in SOL terms. The index rose almost 300% in less than 30 days, led by y00ts, DeGods, SolanaMonkeyBusiness and Famous Fox Federation, to name a few. The price decline in both SOL and USD terms unlocked a wave of liquidity from users who saw a chance to finally be able to purchase their dream NFTs.
If we take into account the aggressive decline in USD terms, it is realistic to assume that the SOL Index might be in price discovery for the coming months. One other scenario is a longterm consolidation with low volatility which will lead to stagnation.
Core Solana NFT User Base is growing
The Daily Average Mints per Address is a metric that can be interpreted somewhat similarly to the customer retention rate. Higher Average Mints per Address correspond to a more engaged/matured community. The Bear Market has forced most of the liquidity to flow from weaker projects to stronger ones. The number of projects minting has greatly decreased given that the risk of failure is far greater than the risk of succeeding. This has lead the Solana NFT ecosystem to witness some of the most ambitious teams to rise up and launch amazing projects.
The bear case is that the community has shrunk due to the bear market, leaving only the most engaged users. This is a strong argument, as it is inversely correlated with the price action of the SolanaFloor Index in USD terms.
Royalties
The royalty discussion has been going on for over three months. While many NFT project leaders went missing or rug-pulled, many others stuck to their guns and developed new revenue-generating products to offset the loss of income from the 0% royalty meta. Many others created incentives for paying royalties. Among all the NFT projects, some collections were able to keep the royalty revenue flowing, such as Liberty Square, Portals, Galactic Gecko Space Garage, Ghost Kid and Solana Monkey Baby Business.
Sellers, Buyers & Traders
In the past 30 days, more than 125,000 unique wallets have traded NFTs on the Solana Blockchain. Based on this data as well as the number of Active Addresses, it can be said that the NFT ecosystem is very relevant to the success of Solana, especially in a Bear Market.
Data from the SolanaFloor platform shows a clear downtrend in the last 90 days. Since September, the average Buyer volume per day has declined by almost 50%, driven by the bear market and the collapse of FTX. The Seller volume has also been decreasing overtime. Based on the observed on-chain data and the recent volume consolidation, it is possible to conclude that the network is going through a cooldown period.
NFT Highlights of the Week
Biggest Sale - Rank #1 y00ts
Y00ts have been without a doubt one of the best performing collections this year. The biggest sale of the week goes to y00t #6423, which sold for 1999 SOL, or $23.5k.
Cets on Creck - WTF is Laboog?
Cets on Creck are one of the most lively communities in the whole NFT ecosystem, not just on Solana. Peblo and his team have been teasing the space for months over the launch of their IP play, the Enlightened Cets.
This week, they dropped WTF is Laboog?, a playful website with sneak peeks of Enlightened Cets.
Hadeswap & ABC are taking the Spotlight
Hadeswap and the ABC collection have been on the rise in the last weeks. The NFT AMM has been consistently rolling out updates on their UI/UX. In addition, the team has been hinting that the $HADES token is coming soon. This has sparked a 50% run up on the ABC collection, catapulting the floor price to an All-Time-High of 100 SOL.
DeGods III
DeGods have undoubtedly helped the Solana NFT ecosystem thrive in 2022. It is both the most criticised and the most coveted collection on Solana.
This week, DeGods & Frank relived memories from earlier this year, when the DeadGods reveal started. The whole DeUniverse has rebranded to III, hinting a third collection with “the best art ever seen”.
The DeGods collection reached a remarkable milestone: The most traded collection on Solana, ever.
Magic Eden Tackles Royalties
When Magic Eden pivoted to the 0% royalty meta, it pledged to create and sponsor a way of incentivising royalties without pressuring collections and without forcing users to pay the extra amount. This week, they released their rewards program, which indirectly incentivises users to pay for royalties, as it increases their overall SOL volume. The more volume a user generates, the higher the level, resulting in a chance to earn better rewards other than a reduction in fees.
Dialect Launch Day
Dialect is a smart messaging protocol for dApp notifications and wallet-to-wallet chat. Their mobile app launched this week for iOS only, however the team confirms it will be available soon on Android, and on day one for SAGA.
To mobilise the NFT community, Dialect is rewarding early supporters with limited Sticker Packs which might give access to special edition mints in the near future.
Knittables
Knittables is another success story for the Solana NFT ecosystem, especially since the team was initially planning to mint on Ethereum. They have sold out the collection and are currently at 77.7K SOL volume in under 2 days.
Conclusion
This bear market has shed away its inexperienced users, leaving only the most passionate community members and builders. The community demands more from projects, and data shows that they are delivering quality.
There has never been as much innovation as now on the Solana NFT ecosystem. Projects and teams are working around the clock to gain market share, by pushing innovative products and experiences in ways that have not been tried before. This war has led to a massive move towards interesting use cases such as NFT mortgages, messaging apps, NFT AMMs, NFT DeFi and more.
Who knows what’s coming in the future? We don’t (yet), but you’ll be the first to know.