The NFT marketplace is facing the biggest oversupply problem of any asset class ever, creating a very inhospitable market for NFT sellers. An astounding 79% of all NFT collections have never had a sale. This has left more than 23 million people holding NFTs they’ll never be able to redeem for anything. The recent inflation has made most digital assets massively overvalued. 95% of NFT collections are currently considered totally valueless.

The current NFT market paints a theatrical picture of this chasm. We’ll hear about the hype surrounding each high-profile sale, for most NFT holders the experience is far from glamorous. Those multi-million dollar headline-grabbing transactions seem to make up the whole market, but they actually account for a tiny portion. The reality is that the overwhelming majority of NFTs don’t have a single buyer; their value has all but disappeared.

Oversupply and Worthless Collections

That data presents a worrying picture of the NFT market today. 97% of the new NFT collections created in 2024 have had essentially zero trading volume when released. At the moment, cheap tokens (below $100) represent 41% of all NFT market sales. Unlike cryptocurrencies, less than 1% of NFTs are worth more than $6,000.

Reality isn’t much better either. A mind-boggling 95% of NFT collections have a market cap of 0 ether indicating little to no demand or liquidity. Even on these supposedly blue-chip NFT collections, 18% have a floor price of $0, meaning they’re worth nothing.

Exceptions and Intrinsic Value

Even in the wake of this prevailing decline, there remains a handful of NFTs that have continued to hold their merit and allure. Early projects such as CryptoPunks are an essential part of digital history. Their historical importance and rarity continue to drive prices through the roof. These NFTs are more than digital collectible assets; they are a one-of-a-kind piece of internet culture and innovation.

Specific NFT projects truly represent artistic innovation. Art Blocks’ “Chromie Squiggle” and Dmitri Cherniak’s “Ringers” are some of the best-known NFTs. For the artistic quality of their work and the innovative creative approaches they take, they are exemplars. These projects illustrate that NFTs are more than just speculative investments. Second, they continue to act as a unique and powerful medium through which musical artistry can be expressed.

Long-Term Belief and Community

In response, some lenders are now making loans with terms up to three years. They use NFTs as collateral, a sign that they believe in the long-term value of particular NFT collections. Even with the wider market experiencing turbulence, there is still value in some NFTs. These digital assets are unique and scarce, meaning they can appreciate over time.

Perhaps it’s the feeling of belonging that NFTs create among their communities — a potential source of enduring demand. For many NFT collectors, simply owning a specific NFT is not enough. It’s not just about the pixels, it’s about connecting with a community and connecting with others who share your passion. This feeling of ownership can turn a plain old digital image into a treasured and lasting contribution as well.