The global non-fungible token (NFT) sector has fallen below $1.5 billion in total market capitalization, returning to levels last seen before the sector’s rapid expansion in 2021.
According to CoinGecko data, the correction came amid a broader deterioration in the cryptocurrency market over the past two weeks. can be seen. On January 23, the total cryptocurrency market capitalization was around $3.1 trillion, and on Friday it dropped to $2.2 trillion.
Major assets like Bitcoin (BTC) dropped from around $89,000 to around $65,000, while Ether (ETH) dropped from $3,000 to almost $1,800 over the same period. Bitcoin and Ethereum are the top two networks for NFTs in terms of 30-day trading volume, According to CryptoSlam NFT data aggregator.
The decline in NFT market capitalization comes after several high-profile shutdowns and exits, highlighting the continued contraction of the sector.
Increasing supply collides with falling demand
The market reset has been compounded by a growing imbalance between NFT supply and buyer demand.
As Cointelegraph reported on December 31, the total supply of NFTs continued to grow even as sales and prices fell, pushing the sector into a high-volume, low-price structure.
CryptoSlam data showed that the number of NFTs in circulation rose to nearly 1.3 billion in 2025, up 25% from 2024. Total NFT sales fell 37% year-over-year to $5.6 billion, while average selling prices fell below $100.
The discrepancy suggests that while minting coins has become cheaper and barriers to issuance have fallen, buyer participation and spending have not kept pace.
Related: US prosecutors will drop the OpenSea NFT fraud case after an appeals court overturned the verdict
Corporate exits and platform closures enhance the pressure
The decline comes after a series of high-profile reversals that reflect a market retreat. On January 7, footwear giant Nike quietly shuttered RTFKT, a digital collectibles studio it acquired at the height of the NFT boom.
The reported sale was a consequence of the company’s decision to cease operations in connection with an investor lawsuit.
Moreover, trade shutdowns accelerated. Nifty Gateway, one of the earliest NFT platforms, said it will close on February 23 and has switched to cash-only mode. The Gemini-owned platform mentioned the prolonged market downturn.
On January 28, social NFT platform Rodeo announced that it would cease operations due to lack of sustainability. The rodeo said it would go into read-only mode and then shut down completely in March.
Warehouse: Digital art ‘ages like fine wine’: inside Flamingo DAO’s 9-digit NFT collection
