NFT's "Breaking Out": Wild Growth, Still Pending Regulation
At the end of 2020, NFT, which had been building momentum for over three years, entered a period of rapid development. Tens of thousands of NFT were Trading , NFT-related token prices surged, and discussions about NFT across various communities increased visibly. "Smart money" accelerated its flow into NFT, with numerous investments pouring in, and news of NFT being sold at high prices repeatedly added fuel to this space. The rapidly soaring market cap made NFT one of the most closely watched hot tracks in this bull cycle.
NFT Continues to Attract Capital, May Lead the Altcoin Season
NFT investment has been on fire recently. According to incomplete statistics, from March 22 to March 28, there were 42 blockchain financing events domestically and internationally, of which NFT accounted for 11.
On March 30, Dapper Labs, the development team behind NBA Top Shot, announced the completion of a $305 million funding round, raising its post-money valuation to $2.6 billion. Notable NBA players such as Michael Jordan and Kevin Durant were among the participants in this round.
On March 31, Enjin completed a $18.9 million funding round, planning to build Efinity, a next-generation NFT blockchain based on Polkadot. Borderless Capital launched a $10 million fund to promote the Algorand NFT ecosystem. On April 1, NFT trading platform Zora stated it had raised nearly $8 million through equity sales……
At the same time, celebrities continuing to enter the space and NFT being frequently sold at high prices have further heated up this market. Following Christie's, a top auction house, selling Beeple's NFT artwork for nearly $70 million, Sotheby's and Phillips, the other two major auction houses, both announced they would auction crypto art NFT works in mid-April.
With the blockbuster release of Godzilla vs. Kong , Legendary Pictures launched three NFT collectibles related to the film. Luxury brands such as Gucci stated that releasing NFT was only a matter of time. In addition, renowned Japanese artist Takashi Murakami launched NFT collectibles on OpenSea, author N.E. Carlisle's novels Mermaid Eclipse , and TIME magazine covers were sold as NFT, Grammy winner The Weeknd's first NFT music sales reached $2.29 million. It is not difficult to see that NFT's "outreach index" is rising rapidly, with its appeal growing by the day.
The continuous inflow of funds, combined with the buzz effect, reflects the continuous rise of NFT's market cap. In our April 4 article titled "NFT Ushering in a Period of Surging Data—Is the NFT Bull Market Coming?", we provided the chart below, at which time NFT's total market cap was $4.98 billion, accounting for 0.3%.
A month has passed, and currently NFT's total market cap stands at $27.6 billion, an increase of over 450%, with its share rising from 0.3% to 1.4%—a massive growth.
Starting in April, star projects across multiple tracks will gradually kick off intensive activities. Compared to DeFi, NFT can almost seamlessly reach all groups, including art, content creation, patents, intellectual property, real estate, financial trading, and more. Its lower barrier to understanding and faster breakout speed compared to DeFi, combined with NFT's currently smaller market cap, far from its peak era, have led many to place great hopes in NFT, believing it can write a wealth-creation story similar to DeFi.
NFT Secondary Market Is Growing Rapidly, But Still in Early Stages
When it comes to NFT, many people first think of artworks sold at sky-high prices. Visiting the Crypto Art website, the homepage showcases the splendor of these valuable artworks.
The "breakout effect" brought by high-priced art auctions has led to a thriving NFT market. According to Crypto Art data, the total value of crypto art has now reached $496 million, with 172,880 pieces sold. Notably, the value of crypto art sold in March alone exceeded $200 million, doubling compared to February. As shown in the chart below, the crypto art market saw a clear surge after February 2021.
Whale Shark, a major whale player who has been deeply involved in the NFT space, shared ideas for investing in NFT back in September 2020: directly purchasing NFT, participating in NFT project financing, purchasing NFT-related tokens, and investing in NFT collectibles.
For newcomers, purchasing NFT-related tokens is the most basic and straightforward investment approach, as the method is similar to traditional cryptocurrency trading. Users can choose to purchase on mainstream exchanges such as OKX , with the advantages of sufficient liquidity, low entry barriers and fees, and a higher probability of strong performance for projects that have passed the screening of mainstream exchanges. Alternatively, users can purchase on decentralized exchanges such as Uniswap—the advantage of DEX is that many emerging projects launch there first, allowing users to get in early with low-cost筹码, though they face issues such as expensive gas fees and trading congestion.
According to CoinGecko data, the current top 5 NFT-related tokens account for nearly 70% of the total NFT market cap, indicating that funds are currently concentrated in top-tier projects.
In addition to secondary market participation, if users have the opportunity, they can also participate in early private sales and public offerings of NFT projects. The operating method is similar to other blockchain projects, so it will not be elaborated on here.
As for purchasing NFT and investing in NFT collectibles, there are currently dozens of NFT trading platforms of varying sizes in the market. The more active ones include OpenSea, Mintbase, NBA Top Shot, Nifty Gateway, MakersPlace, SuperRare, Rarible, and others. Among them, OpenSea has long occupied the position of the largest NFT trading venue on Ethereum, as its diverse service areas allow trading of crypto art, virtual items, gaming items, cards, domain names, and more, with a more universal user base. It is regarded as the "Amazon" of the NFT world.
Users need to do some preparation before purchasing, such as setting up an Ethereum wallet and depositing some ETH into it. Due to the recent surge in gas fees, users must ensure sufficient ETH is deposited in the wallet. The most popular payment method on OpenSea is ETH, though the platform also supports DAI and USDC. Of course, some social tokens or gaming tokens can also be used on OpenSea, which stems from OpenSea's open nature. OpenSea also supports swapping between ETH and WETH. Unlike ETH, which can only be used to bid on one item, WETH supports bidding on different items.
Visit the OpenSea website, connect your Ethereum wallet, click "Browse" at the top, and you can start shopping.
Select the NFT you like, click "Buy Now" (this sales method is fixed-price sale, meaning the seller sets the price directly; some sellers opt for an auction format), and confirm in your wallet.
On-chain fees are relatively expensive, with gas fees costing $46.77.
At the bottom of the OpenSea page, you can also view every operation and copyright change the artwork has undergone since its creation.
The booming primary NFT sales is an undeniable fact, whether evidenced by the steady stream of items sold at "high prices" or the influx of participants from all walks of life into NFT. However, for this market to develop sustainably, a healthy secondary market is essential.
From the Dune Analytics chart, taking SuperRare as an example, the secondary market is developing rapidly. In February 2021, primary sales were $7,082,500, secondary sales were $3,299,300, and secondary sales accounted for 31.78% of total sales. By March, primary sales reached $16,959,500, secondary sales reached $12,610,000, and the proportion of secondary sales rose to 42.65%.
Crypto Art founder Richard Chen stated that the NFT secondary market is developing rapidly, but it typically centers on high-value artists. This means that while NFT brands itself as a "boon for content creators," most creators, facing limited visibility, seem to encounter the same challenges in the NFT market as they would elsewhere—for now, those who can sell at "high prices" or achieve "commercial success" are predominantly individuals already renowned in traditional fields.
Although NFT has indeed become a carnival for crypto creators, with many mainstream artists eager to get involved, it is important to note that due to capital dividends and the "everything can be NFT" philosophy, a large volume of works have flooded in within a short period. Some have even stolen others' artistic work and created digital art to sell for profit.
For example, when we just placed an order for an NFT product on OpenSea, we received the following notice. This is because OpenSea has no entry barriers—anyone can use any name to create digital items on the blockchain, even creating counterfeit versions of existing items.
Currently, if NFT wants to achieve a full breakout, there is still a long way to go in terms of upper-level market standards and rule-setting, beyond just the underlying infrastructure. We cannot deny that the NFT market does contain significant bubbles, and the so-called "surge" in the short term is merely a result of the small market size. However, this "bubble" is not necessarily frightening—its existence has attracted more people willing to learn about, or even participate in, NFT. The development of things follows a spiral upward trajectory, so we remain optimistic about NFT.
Disclaimer: digital assets trading involves significant risk. This material should not be taken as a basis for investment decisions, nor should it be construed as advice to engage in investment trading. Please ensure you fully understand the risks involved and invest cautiously. OKX Academy only provides information for reference and does not constitute any investment advice. All investment activities by users are unrelated to this site.
Disclaimer
This article may contain product-related content not applicable to your region. This article is committed to providing general information only and does not accept responsibility for any factual errors or omissions herein. This article represents the author's personal views only and does not represent the views of OKX. This article is not intended to provide any advice, including but not limited to: (i) investment advice or investment recommendations; (ii) offers or solicitations to buy, sell, or hold digital assets; or (iii) financial, accounting, legal, or tax advice. Holdings in digital assets (including stablecoins) involve high risk and may fluctuate significantly, or even become worthless. You should carefully consider whether trading or holding digital assets is suitable for you based on your financial situation. For questions regarding your specific circumstances, please consult your legal/tax/investment professional. The information contained in this article (including market data and statistical information, if any) is for general reference purposes only. While all reasonable precautions have been taken in preparing such data and charts, we assume no responsibility for any factual errors or omissions expressed herein. © 2025 OKX. This article may be reproduced or distributed in its entirety, and excerpts of 100 words or fewer may be used, provided that such use is non-commercial. Any reproduction or distribution of the full article must prominently state: "This article is copyrighted © 2025 OKX, used with permission." Permitted excerpts must cite the article title and include attribution, for example, "Article title, [author name (if applicable)], © 2025 OKX." Some content may have been generated or assisted by artificial intelligence (AI) tools. Derivative works and other uses of this article are not permitted.
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