Is Coinbase late to the NFT party?

Sahana Kiran
Source – Unsplash

NFT started in 2021 and managed to retain the fervor around them all year long. Crypto took the front stage and witnessed increased adoption thanks to NFTs. With the popularity of the space surging by the day, an array of platforms hopped onto the bandwagon. Crypto exchanges steered away from their usual trading services and decided to roll out easily accessible NFTs through their platforms. Coinbase was also smitten by the NFT bug. The exchange recently rolled out its NFT marketplace. But, things did not go as planned.

Coinbase had announced its entry into the NFT space back in 2021 itself. The exchange formulated a waitlist that allowed interested users to sign up for the imminent marketplace. For seven months, the exchange amassed nearly 8.4 million emails that signed up for the NFT space. This further ignited hope that Coinbase’s platform would blow up following its launch. However, in a bizarre scenario, the exchange failed to garner a lot of traction during its launch.

Coinbase opened its doors to the public earlier this week and recorded a total of 150 transactions along with $74,700 in USD volume. A chart from Dune Analytics points out that the trading for the was just $126,844.

Source – Dune Analytics

These numbers have only fallen ever since. On 5 May, the platform recorded only 121 transactions. The above chart curated by Dune Analytics highlights the number of transactions that occurred via the 0x Protocol. Coinbase has currently employed this infrastructure for its NFT marketplace.

Community reacts to Coinbase’s brand new marketplace

The community was rushed in to point out that the exchange failed to amass the traction that was expected.

Meanwhile, a lot of comparisons between Coinbase and OpenSea have been surfacing. Speculations about the crypto exchange taking over as the world’s largest NFT marketplace were all over social media. Contrdictoryly, OpenSea’s transaction volume for the same day was a little over $1 billion.

But what went wrong?

An array of factors could have influenced Coinbase’s failure in becoming a hit in the NFT space. According to a report by the Wall Street Journal, NFT sales have plummeted by 92 percent since September 2021. The active wallet addresses followed suit by dropping to 14,000 since November 2021. Therefore, the community speculated that the fervor around NFTs was slowly dying down and Coinbase seems to have missed the bus to the NFT party.

Alongside this, the recent mishap caused by Yuga Labs’ Otherside metaverse launch could have also played a vital role in the lack of users. Crypto Twitter accused Yuga Labs of clogging up Ethereum and most NFTs have been employing the ETH blockchain for the same. Additionally, Solana’s recent outages could have added to this.