A CryptoPunk non-fungible token (NFT) recently sold for such a loss at $10 million. This dramatic sale further highlights the volatile nature of the digital asset market. The NFT market has been in a steady downward spiral since its height in 2021. This incident is a particularly harsh reminder of the dangers of investing in such assets.
A non-fungible token (NFT) is a digital token on a blockchain that certifies that a certain piece of digital property belongs to a specific person. Evolving from collectibles, NFTs like CryptoPunks and Bored Ape Yacht Club collectibles were the stars of the NFT craze as “digital art.” These days, they’ve mesmerized the minds of every crypto investor and advocate.
CryptoSlam, an NFT analytics company, found that the CryptoPunk collection ranks as one of the five most expensive NFTs. Some NFTs that were selling for as much $50 million have recently been flipped for mere pennies. This sudden collapse is just another example of how unexpected the market can be.
One example of this is a CryptoPunk NFT bought at an auction for $16 million U.S. The digital wallet that originally purchased CryptoPunks #3100 has now resold the NFT for 4,000 Ethereum (ETH). That sale created an incredibly costly $10 million U.S. loss from what was originally invested.
Indeed, CryptoPunks #3100 is still the third-highest NFT ever sold. Regardless, this recent transaction shines a glaring light on the massive crash of the NFT market.
At the height of the crypto craze in 2021, some CryptoPunk collectibles sold for more than U.S. $1 million. Nowadays, you see them advertised online from as low as $65,000 U.S. This sharp reversal underscores just how fast these digital assets have lost their value.
