Centralized exchange Kraken will discontinue its NFT marketplace to allocate resources to future projects. Users will no longer be able to list, bid on, or sell items after today (27).
However, withdrawals will continue to be available until the marketplace closes completely on February 27, 2025.
Kraken’s NFT platform fails to meet expected growth
Kraken notified users of the decision earlier today via an emailed statement. Launched in November 2022, Kraken’s NFT platform has faced challenges as the digital collectibles market has weakened. The landscape has become extremely saturated in recent years.
Over the course of 2024, 98% of NFT collections saw little to no trading activity. Only 0.2% of new NFT releases generated profits, while the majority lost more than 50% of their value within a few days.
On average, NFT holders are facing a 44.5% loss since 2023. The average lifespan of an NFT is now 1.14 years, significantly lower than the 2.85-year lifespan of typical crypto projects. Last year, nearly a third of NFT initiatives failed, the highest rate on record for the industry.
Monthly NFT trading volume from January 2023 to October 2024. Source: Dune
Thus, Kraken’s decision comes as no surprise. It’s clear why the exchange decided to reallocate its resources to other important developments.
The US-based crypto exchange recently announced plans to streamline its policy and list 19 new tokens. This also includes the Donald Trump-inspired ‘TRUMP’ token, along with other popular memecoins.
Amid the slump, there are signs of recovery. Telegram reported a 400% increase in NFT activity during Q3 2024, driven by the integration of NFTs into gaming platforms like Hamster Kombat. In September, daily wallet transfers surpassed one million.
Additionally, an address linked to Ethereum co-founder Vitalik Buterin recently minted 400 Patron NFTs on Base. This has sparked fresh discussions about the potential renaissance of NFTs as the industry looks for new use cases.
The article Kraken Shuts Down NFT Marketplace Amid Market Crash appeared first on BeInCrypto Brasil.