Dune

NFTs still in ‘great demand’ as unique traders rise 18% in Oct: DappRadar

A DappRadar report found that despite a fall in NFT trading volumes and sales counts throughout October, monthly unique traders increased.

October may have seen a decline in nonfungible token (NFT) trading volume and sales, but analytics firm DappRadar says an 18% growth in monthly unique NFT traders shows the market is still in “great demand.”

According to a Nov. 3 report from DappRadar, the number of monthly unique NFT traders in October reached 1.11 million, increasing 18% from September, of approximately 950,000.

This is despite trading volumes falling 30% to $662 million in October, the lowest registered in 2022, while the sales count decreased by 30% to 6.13 million, the firm said, adding:

“The rise in the unique traders’ count indicates that new people are entering the NFT market, and it is still in great demand.”

*Number of monthly unique NFT traders (millions). Source: DappRadar*

The month was a busy one for the NFT community.

At least two more NFT marketplaces shift to an optional royalty model, including Solana-based Magic Eden and Ethereum-based LooksRare.

The report also highlighted that Yuga Labs has continued to dominate the NFT market, with seven of the top ten sales for the month coming from CryptoPunk and Bored Ape Yacht Club.

Of these sales, CryptoPunk#924 was the most valuable, selling for a whopping 475 Ether (ETH) on Oct. 27, which is valued at $731,435 at the time of writing.

Meanwhile, Ethereum’s NFT trading volume continued to decline for the second straight quarter, falling 21% over the last month to $324 million, which represents the lowest volume registered by DappRadar since June 2021.

In brighter news, Polygon’s NFT trading volume has spiked 770% over the last month, driven by the success of the Reddit NFT collections as the main driver behind the surge, according to DappRadar.

Since their launch in July, more than 2.9 million Reddit avatars have been minted, which have found their way into more than 2.8 million wallets, with Dune analytics data suggesting October finished with the collection having a sales volume of $10.1 million.

The trading volume seems likely to continue increasing for the layer-2 solution over the next month, with Meta announcing on Nov. 2 that Polygon would be its initial partner for its upcoming NFT tools.

The report also mentioned that Dogecoin (DOGE) had been the best-performing token of the month, closing the month 50% higher than when it began and citing Elon Musk’s Twitter takeover and the announcement of Dogechain’s future roadmap as the drivers.

It also highlighted an increase in the average number of unique active wallets, up 6.84% from the previous month. DappRadar pointed to staking provider Lido being incorporated within Arbitrum and Optimism as well as a partnership between the Near Foundation and Google Cloud as the drivers for this increase.

Arbitrum transaction activity rockets 550% since August: Delphi Digital

Following the Nitro upgrade, activity on Arbitrum has surged and has nearly two-thirds of the transaction activity seen on the Ethereum base layer.

Ethereum layer-2 scaling solution Arbitrum has seen a massive surge in activity since its Nitro update in August, having just clocked around 62% as many transactions as the Ethereum base layer.

In a Nov. 1 report, crypto research firm Delphi Digital noted that as of the week ended Oct. 24, Arbitrum’s number of total transactions has increased by 550% since August, citing data from Dune Analytics.

This week, @arbitrum had ~62% as many transactions as Ethereum L1. pic.twitter.com/DyuDNAjRGz

— Delphi Digital (@Delphi_Digital) November 3, 2022

In an earlier Tweet, Delphi Digital initially phrased Arbitrum as accounting for 62% of all transactions on Ethereum, which they later clarified was “incorrect phrasing.”

Arbitrum is an optimistic roll-up built by blockchain development firm Offchain Labs, aimed at scaling Ethereum smart contracts. It uses Optimistic Rollup technology to bundle large batches of transactions off-chain from Ethereum smart contracts and decentralized applications before submitting them to Ethereum.

A number of well-known protocols use Arbitrum, such as decentralized exchanges SushiSwap, Uniswap and GMX, lending protocol Aave and liquidity transport protocol Stargate. According to L2Beat, at the time of writing it has a current total-value-locked (TVL) of $2.59 billion.

Delphi analysts noted that weekly active users had spiked on Arbitrum, having grown 125% since Oct. 10 to reach a new high of 282,000 in the week ending Oct. 24.

The analysts also suggest that much of the surge in activity is likely driven by speculators trying to boost their on-chain activity in the hope of receiving a larger airdrop for a native token which has been hinted at by Offchain Labs co-founder Steven Goldfeder.

On Aug. 31 the Arbitrum One mainnet upgraded to Nitro, which Offchain Labs claimed in an April 7 post would result in reduced transaction costs while increasing network capacity, adding:

“While Arbitrum today is already 90–95% cheaper than Ethereum on average, Nitro cuts our costs even further.”

The low fees have resulted in various players from within the crypto ecosystem wanting to integrate with Arbitrum One, and on Nov. 1 decentralized finance (DeFi) optimization tool Furocombo, capital raising protocol Aelin and insurance protocol Y2K Finance each announced they were live on the popular scaling solution.

On Oct. 13 Offchain Labs announced they had acquired one of the core development teams behind the Ethereum Merge, Prysmatic Labs, which it hopes will enable greater communication and collaboration between developments on both layers.