Non-fungible token (NFT) sales have plummeted this month amid the recent memecoin frenzy and a surge in the price of Ethereum (ETH) gas fees.
According to blockchain intelligence platform DappRadar, NFT trading volume has only reached $333 million this month so far, putting May on track to be the first month in 2023 with a trading volume under $1 billion.
DappRadar says a “considerable number” of crypto traders sold their NFT holdings at a loss at the beginning of the month to participate in the memecoin mania driven by the volatile frog-themed token Pepe (PEPE).
“This has led to an uptick in on-chain activity, subsequently driving Ethereums gas fees above $100. This increase in transaction costs has negatively impacted the volume of low-value NFT trades on the blockchain, as traders grapple with affordability concerns.”
There has, however, been a 27% increase in the average number of daily unique active wallets interacting with NFTs in May compared to April, with DappRadar attributing the bump to the fanfare surrounding the new “Milady Maker” NFT collection.
Ethereum continues to be the dominant NFT chain, controlling 81% of the trading volume in May so far. It’s only responsible for 5.7% of the total number of NFT sales, however, meaning it’s being used for higher-volume transactions, according to DappRadar.
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This article was originally reported on The Daily Hodl.