NFTs
Will Ethereum NFTs Return?
Highlights in the chain
DEFINITION: The relative amount (share) of gas consumed by the Ethereum network by transactions interacting with non-fungible tokens. This category includes token contract standards (ERC721, ERC1155) and NFT marketplaces (OpenSea, Blur, LooksRare, Rarible, SuperRare) to trade them.
Ethereum gas usage by NFTs exhibited significant changes in recent years, mainly because different platforms have gained and lost prominence. Recent data indicates that Blur and OpenSea have consistently dominated gas consumption since the beginning of 2024.
This reflects the growing activity on these platforms as traders and collectors continue to engage in the NFT market. In contrast, platforms like Rarible and SuperRare show relatively lower gas usage, highlighting their smaller user bases or less frequent transactions.
Ethereum: gas usage by NFTs: (Source: Glassnode)
Historically, significant spikes in gas usage by NFT transactions correlate with broader trends in Ethereum price movements. For example, the surge in early 2021 coincided with a considerable bull run in the crypto market, generating more transactions and higher gas fees. As the price of Ethereum stabilized in mid-2023, NFT-related gas usage also normalized, illustrating the interconnectedness of these metrics.
The current scenario suggests that while new NFT marketplaces are emerging, established platforms like Blur and OpenSea maintain relative dominance, continually influencing Ethereum’s overall gas consumption patterns. This dynamic plays a crucial role in understanding the operational costs and transaction efficiency of the Ethereum network.
While relative usage may be consistent with previous cycles, overall NFT gas usage has plummeted since January 2023 as a percentage of overall network activity. At its peak, gas usage broke 40%, with levels consistently above 30%. Current levels are below 4%, in part due to the increase popularity of 2 layers, like Base and side chains, like Polygon and a general downtrend in the NFT market.