Despite a significant drop in overall trading volumes, the prices of NFTs are starting to rise. In August 2024, NFT trading reached only $148 million, a stark contrast to the peak days of 2021 when daily trades surpassed $100 million. This downturn has not, however, deterred the performance of certain NFT collections, particularly those featuring AI-generated art.

AI Art Collections Lead the Market

AI art NFTs are seeing remarkable gains. For instance, Refik Anadol’s “Winds of Yawanawa” surged from 3.9 ETH to 7 ETH, marking an 80% increase within a week. Similarly, the “alignDRAW” collection, featuring early text-to-image prompts by Elman Mansimov, saw a 90% rise from 0.83 ETH to 1.57 ETH. These collections are among the largest gainers in the current NFT market.

Other prominent NFT collections like Bored Ape Yacht Club, Doodles, and Pudgy Penguins have also seen price increases, ranging from 5% to 10% over the past week. This upward trend is supported by notable sales, including rare CryptoPunks fetching high prices, such as a “hoodie zombie” NFT sold for $1.3 million.

Impact of Marketplace Incentives

The recent price increases come amidst a backdrop of low trading volumes and shifting market dynamics. The NFT marketplace Blur, known for its incentive-driven models, may have influenced this trend. Historically, platforms like Blur encouraged traders to undercut prices to earn rewards, potentially distorting the market. Although the incentives might have led to price corrections, they also possibly attracted genuine buyers, as evidenced by the rising floor prices of prominent collections.

While the NFT market faces reduced trading activity, certain segments, especially AI-generated art, are thriving. The recent performance of AI art collections and top NFT series highlights a resilient and evolving market, even as overall trading volumes remain low.