The end of 2022 and first half of 2023 was rough for NFT collectors and marketplaces. Famous collections like the Bored Ape Yacht Club saw its floor price decline by nearly 88% in value, and the most popular NFT marketplace OpenSea experienced a drop in sales from its all-time-high of $4.9 billion in January 2022 to less than $50 million in October 2023 – a decrease of 99%.
But while the struggle was real, 2023 also saw the arrival of new projects, marketplaces, artists, and NFT utilities that are making their mark on the space. As we approach the new year, there appears to be some light at the end of the tunnel.
Whether music or digital art, sports, film, automobiles, fashion or games – NFTs continue to permeate a myriad of industries and challenge traditional notions of ownership, authenticity, and value. In this article we aim to highlight some of the positive advancements in the NFT space in 2023, from new NFT collections and marketplaces, to an unlikely contender for the top NFT blockchain. Let’s have a look.
Here’s a review of the NFT projects that excelled in 2023:
Pudgy Penguins
Under the helm of 25-year-old CEO Luca Netz, who became the leader of the Pudgies in 2022, Pudgy Penguins has excelled.
It has formed a merchandising deal with Walmart, putting the Penguin plushies in stores across America, created a social outreach campaign that has integrated the adorable art into pop culture, and generated tremendous amounts of enthusiasm for the upcoming Pudgy World, a blockchain metaverse game.
And the NFTs have followed suit. Once at the lowest of lows after a rug pull that saw the previous owners admitting the Pudgies were an “empty company,” the collection has soared to 10.8 ETH floor price, defying bear market expectations.
The promise of Netz to “build in public” seems to have been a good move. Holders are happy, the brand is growing, and there is little doubt that the best of the Pudgy Penguins is yet to come.
Jack Butcher’s Medley of Interactive NFTs
From Opepen and Trademark to Signature and VV Checks, Jack Butcher left his mark on the NFT space in 2023, dazzling holders with a myriad of fun art tokens that often have interactive elements.
Take, for instance, the Opepen collection, which started as an open edition. A mix of different shapes that resemble the upper body of a humanoid creature, the Opepen model is a dynamic play on PFPs. After the roll out of a machine that allows for the importation of color, anyone can create an Opepen out of any image, a movement that entertained degens during the deep bear market.
Some say Jack Butcher is a master marketer, creating collections that engage the public rather than sit idly in wallets. Time will tell what exactly he plans to do next (two new collections were just released recently), but there’s no doubt he has the attention of the community and is a positive force in the space overall.
CryptoPunks
After a 2021-2022 bull run that had old Web3 veterans shaking their heads and the reign of CryptoPunks falling to the Bored Ape Yacht Club, the set known for being the first ever PFPs and an experiment in digital art ownership reclaimed its throne as the top collection around, reaching a floor price of 55.7 ETH in the middle of the bear market.
To put that in context, its top competitor, Bored Ape Yacht Club, currently has a floor price of 27.5 ETH, roughly half that.
And the project hasn’t been content to rest on its laurels either. After a 2022 that saw the collection purchased by Yuga Labs, various CryptoPunks initiatives have sprouted up, including the creation of a documentary about the Punks, a special Tiffany pendant for Punks holders, and a new wrapper that will allow Punks to be easily tradable on newer NFT marketplaces.
While it may be difficult to elevate the Punks any further (they are the gold standard in the NFT space, after all), Yuga Labs is certainly trying, which will likely appease holders who believed Larva Labs, the previous owner, was doing too little. That bodes well for the NFT space for years to come.
Memeland NFTs: The Captainz, Potatoz, and More
Memeland, a Web3 venture studio formed by the creators of 9GAG, has been on a tear in 2023, debuting The Captainz NFT collection and seeing its other collections, such as The Potatoz, perform well.
In addition, it dropped a well-deserved prize for holders: a token that has no particular function but has soared in value, netting early buyers precious moolah during this deep bear market.
The fact that it has done well during the bear market is truly a feat in itself, as the crippling market conditions have seen well-established collections like Azuki and DeGods fall in value. It has separated itself with continuous communication on X, proving the new way of building in public can keep spirits up during hard times.
The team focuses on under-promising and over-delivering, which has paid off well and invites its holders to build with the team, something in line with Web3 ethos. Up next are a variety of projects, including Holders.com, PETSLAND, and more.
Top blockchain: Bitcoin w/ Ordinals
In the last bull run, we had two primary blockchains for non-fungible tokens: Ethereum and Solana. But with the inventive minds in the Web3 space, this year, a third has emerged and it was a surprising one: Bitcoin.
Once known as a staid, old chain that functioned to provide the infrastructure for the best digital store of value, Bitcoin has reinvented itself this year thanks to the work of a developer named Casey Rodarmor. Rodarmor created the Ordinals protocol, which allows for “inscriptions,” or the process of adding images onto satoshis, the smallest unit of measure on Bitcoin.
NFTs had arrived to the Bitcoin ecosystem.
Since then, excited Web3 enthusiasts have made over 52 million inscriptions on the Bitcoin blockchain, a combination of tokens with “pictures” (the classic NFTs) and tokens with “words” (which function as meme coins). The gold rush for Ordinals took off in May, when hundreds of thousands of inscriptions were occurring each day, and that momentum, aside from the occasional off month, has yet to subside.
Web3 companies, sensing an opportunity, have also joined in the fun. Magic Eden quickly launched a Bitcoin Ordinals marketplace, multiple Inscriptions-focused wallets sprouted up, and Yuga Labs, which made a killing on Ethereum, debuted its own Ordinals collection.
A quick check on CryptoSlam shows that Ordinals are still going strong as we approach the New Year, with five Ordinals collections (NFTs and meme coins) in the top 10 of trading volume for all collections for the past week.
If we do have a bull market next year, it’s possible that we’ll see a level of NFT adoption that dwarfs the previous cycles, with trading coming on multiple chains. Hopefully, that’ll end the maxi battles, as everyone will get their piece of the pie.
Top NFT Marketplace: Blur
Launched in October 2022, Blur billed itself as an NFT marketplace for pro traders — the counter to OpenSea’s model that attempted to appeal to all NFT collectors. With a no-frills appearance that even minimizes the size of the JPEGs, Blur was an instant hit among some NFT denizens, reducing royalties and making it more profitable to move large quantities of non-fungible tokens.
In 2023, it has fulfilled its promise, becoming the top Ethereum NFT marketplace at times through a combination of sleek performance and incentives, most notably an airdrop of its native $BLUR token. Season 2 of that airdrop was worth in the tens of millions according to some estimates, a hefty reward for trading on the marketplace.
In addition to the savvy divvying of rewards to users, Blur has innovated as well. It rolled out a lending protocol that quickly became the talk of Web3 and a “buy now, pay later” model that allowed degens to be even more degen-like. And its co-founder recently unveiled BLAST, a L2 protocol for Ethereum, that may come with even more financial rewards.
Although some have criticized it for killing creator royalties, there’s no doubt that Blur has entranced some NFT traders and made it easier on some level to buy and sell NFTs. Controversial, yes, but its moves have resonated in parts of the community.
Time will tell if it is as successful in 2024 as it has been in the bear market, but there’s no doubt that it’s disrupting the NFT marketplace industry sector. And competition is only good for a part of the industry dominated by one marketplace (OpenSea) for so long.
Top Artist: Refik Anadol
Beeple still holds the throne as the most famous digital artist in the NFT space. But this year saw the rise of other artists, most notably Refik Anadol.
In July, the Turkish-American media artist and designer launched his “Winds of Yawanawa” NFT collection in collaboration with the Brazilian indigenous Yawanawa community. Since then, it has done 9,433 ETH (around $21,843,149) on OpenSea – and for a brief time even entered the top ten NFT collections by sales volume.
But what was perhaps even more of a win for the artist and the NFT space in general happened in October, when the Museum of Modern Art (MoMA) in New York acquired Anadol’s project “Unsupervised–Machine Hallucinations.” The acquisition made history when it became the first AI-generated, tokenized artwork to be part of the museum’s permanent collection.
Top sector: Web3 Gaming
Although gamers were initially skeptical of blockchain-based games (and some still are), few sectors made as much noise in the space this year as Web3 gaming. In Quarter 3 of 2023, venture capitalists invested $600 million into Web3 games, pushing the total raised for the year to $2.3 billion.
We also saw major partnerships form in Web3 gaming this year, including Immutable partnering with Ubisoft and Amazon, the Korean gaming giant Wemade partnering with Chainlink, and Animoca Brands partnering with Ubisoft, among others.
Two Web3 games that led the pack in 2023 were Axie Infinity ($90 million in trading volume as of Q3) and Gods Unchained ($55 million), while the most played game was Alien World – a blockchain-based game on WAX. Nitro Nation: World Tour from Mythical Games also had a big year, quickly racking up over 500,000 downloads on the Google Play store.
There’s no doubt that Web3 gaming is gaining momentum, and excitement about the sector is growing steadily. Although the space is still looking for one game to really blow up and attract hundreds of millions of users, many people believe it will happen in 2024.
Biggest surprise: China embraces NFTs and Web3
China has had a tumultuous relationship with cryptocurrency, banning transactions of such tokens numerous times in the past. But thankfully, 2023 has shown that that policy doesn’t apply to other Web3 sectors like non-fungible tokens, the metaverse, and the blockchain.
In fact, China’s policies towards these technologies couldn’t be more of the opposite.
In 2023, China launched a national NFT marketplace, approved a slew of Web3 trademarks relating to NFTs and the metaverse, and created laws that make theft of NFTs akin to theft of physical property, which was music to the ears of degens on X.
It has also taken an interest in the metaverse, though not always on a positive note. Still, with more Chinese companies getting involved in the space, it wouldn’t surprise to see a big boom of Web3 tech in the country next year, which could bode well for the nascent technology space around the world.
Could we see China as a major in Web3 next year?
There’s no telling, but we wouldn’t bet against it.
Top Headlines from the Year:
These might not be the most important headlines in Web3 for 2023, but they are certainly some of the most interesting. From meme coin explosions to the U.S. Secret Service revelation on a Reddit AMA session that it holds crypto and NFTs, Web3 never fails to surprise.
Here are some of our favorite headlines from 2023:
- Sotheby’s to Feature 3AC Grails in Largest Ever Digital Art Auction
- U.S. Secret Service Revealed it Holds Crypto & NFTs
- Starbucks Tabs Its Siren Logo for First Premium NFT Collection
- Blur Challenges Opensea’s Spot as Top NFT Marketplace
- PEPE Meme Coin Takes Crypto World by Storm
- China Unveils Plan to Boost NFTs, Web3 Ecosystem
Final Thoughts
One thing we’ve noticed writing about NFTs for the past couple of years is that when crypto prices rise, it tends to rejuvenate the NFT market. With the price of Bitcoin up over 150% this year, and a potential Bitcoin ETF approval and the halving event just around the corner, many in the space are speculating that 2024 could be the beginning of an explosive bull market.
If that proves to be the case, we expect non-fungible tokens will enjoy the ride. 2023 was a year of ups and downs in the NFT space, but 2024 could be an entirely different story. At Rarity Sniper, we’re excited about what lies ahead.