I Analyzed The Top 15 NFT Collections: Here Is What I Learned

Highlights

• NFTs see the most trading activity shortly after a collection’s launch. Most projects experience a significant drop in trading activity after a few months.
• The performance of NFT collections is influenced by market cycles — more popular NFT collections experience more significant price fluctuations during extreme markets.
• On average, CryptoPunks and Bored Ape Yacht Club achieve the highest sale prices.
• NFT collections follow the same principle as cryptocurrencies; those that reach the top tend to maintain their position over a long time.

The Dataset

For our analysis, we used NFT (non-fungible token) data from Cryptoslam. Please note that the small data sample size should be taken into account.

Trading activity and holding duration of NFTs

Let’s start with the average holding duration in days for NFTs from the analyzed collections.

What is striking is that NFTs of older collections have longer holding times in days on average.

For example, while MG Land, Opepen Edition, and Checks VV Edition all launched within the last three months, NFT collections such as CryptoPunks and Mutant Ape Yacht Club have been on the market for multiple years. On average, the former are held for less than 10 days while the latter are held up to multiple months.

We suspect that this is due to the fact that these are established projects that are considered to have greater value. Another main reason for this could be user activity.

The following chart visualizes the number of unique sellers for popular NFT collections.

In the first months after their launch, NFT collections see the largest numbers of sellers and buyers. This means that NFTs from new collections are traded a lot and, as trading activity and demand go down, remain longer in users’ self-custody wallets.

After the initial weeks of active buying and selling, there is typically a significant decrease in activity. This is not unusual as we know newly launched cryptocurrencies follow similar patterns.

NFT collection performance and underlying market conditions

The chart below shows the average sale price for NFT collections in USD. It also shows that some of the examined NFT collections were introduced on the tail of the last cryptocurrency bull market.

While large parts of the crypto market were bearish in early 2022, most NFT collections shown here recorded increasing average sale prices. In many cases, this development only stopped in April 2022, when hopes for a rapid recovery of the crypto market were finally shattered.

What is also striking is that these collections all bottomed at the same time and rallied together in December 2022.

Another interesting perspective opens up when we take a look at the trading volume of individual NFT collections. The chart below shows an animation of the cumulative sales in USD.

Bored Ape Yacht Club, Mutant Ape Yacht Club, and CryptoPunks saw rapid increases in sales volumes during the ongoing bull market of 2021. Some other projects also saw a similar development in the first months of 2022.

With the full entry of the bear market, the sales of all NFT collections decreased significantly. In the past few months, however, we see once more a stronger increase for some projects.

For now, the best times appear to be behind us.

But a handful of collections are defying the current trend. Here are the 35 highest selling prices realized for NFTs over the last 30 days:

While prices in excess of $1 million are rare, prices in excess of $100,000 are not uncommon. The most frequent among these are Bored Ape Yacht Club and CryptoPunks.

Looking at the different charts, it also becomes apparent that those NFT projects that made it to the top stay there for the long term. This is consistent with the long-time performance of the top 50 cryptocurrencies.

Conclusion

As with cryptocurrencies, it is difficult to generalize about what accounts for the long-term success of NFT projects.

The first-mover advantage has certainly paid off for some of the older projects. In general, the age of the collections does not correlate with the average sale price. We assume that many other factors such as the size of the community, marketing measures, and partners also play an important role.