@susan52halljwko
A weak NFT market indirectly impacts major cryptocurrencies, especially Ethereum, by reducing network activity and transaction fees. NFTs historically drove large volumes of ETH transactions, boosting demand and burning tokens under EIP-1559. Declines in NFT trading volumes reduce this demand, limiting Ethereum’s deflationary effects. Additionally, weaker NFT activity signals broader retail disengagement, which can weigh on altcoin sentiment overall. However, this correlation is not absolute—NFT downturns may free liquidity for rotation into other crypto sectors, such as DeFi or Layer2s. Still, a sluggish NFT market generally reflects risk-off behavior, indirectly dampening enthusiasm for leading cryptocurrencies.
0 reply
0 recast
0 reaction