- Bybit will discontinue its NFT marketplace on April 8, 2024, following a $1.4 billion hack attributed to North Korea.
- Several major companies including X2Y2, Kraken, RTFKT, and LG have recently closed or announced closures of their NFT platforms.
- The NFT market has severely declined with popular collections like CryptoPunks and Bored Ape Yacht Club losing 66% and 90% of their peak values respectively.
Bybit announced it will shut down its NFT marketplace on April 8, 2024, as part of a strategic move to streamline its operations. According to an April 1 statement from the crypto exchange, users need to manage their assets before the platform becomes inaccessible. This closure comes approximately five weeks after the exchange suffered a major hack.
The shutdown follows a February hack of Bybit that resulted in $1.4 billion in stolen assets, making it the largest crypto theft to date. The FBI has attributed this attack to North Korean actors. Beyond the NFT marketplace, Bybit will also discontinue its Inscription Marketplace and IDO product pages.
Industry-Wide NFT Retreat
Bybit‘s decision reflects a broader trend of major companies abandoning the NFT space. Marketplace X2Y2 announced this week it would wind down operations after processing $5.6 billion in trading volume throughout its existence. In a statement, X2Y2 cited a "90% shrinkage of NFT trading volume from its peak in 2021" as a contributing factor and indicated it would pivot to AI.
Other major players have made similar exits. Kraken closed its NFT marketplace on February 27, explaining it was reallocating resources toward "new products and services." Nike-owned RTFKT ceased operations in January after steep declines in its NFT collections’ values. Even LG has plans to close its NFT platform, LG Art Lab, on June 17, stating it’s "the right time to shift our focus and explore new opportunities."
Market Collapse
Once heralded as a revolution in digital art and ownership, the NFT market has struggled to recover from the crypto winter. Floor prices of prestigious collections have plummeted dramatically since their peaks.
CryptoPunks, a leading NFT collection, now trades at a minimum price of 42.59 ETH, representing a nearly 66% decline from its August 2021 high of 125 ETH. The situation is even worse for Bored Ape Yacht Club NFTs, which have collapsed by 90% from a May 2022 peak of 153.7 ETH to just 15.35 ETH currently.
These market conditions have created a challenging environment for NFT marketplaces to maintain profitability, leading to the wave of closures across the industry as companies redirect their focus toward potentially more lucrative opportunities.
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