Coinbase integrates new features into the NFT platform. The reason is the lack of users
Cryptocurrency exchange Coinbase’s platform for trading unique NFT tokens is integrating new features. All of this comes against the backdrop of a general decline in the sector and the site itself, as the crypto industry entered another bearish cycle a couple of months ago. As a reminder, Coinbase’s in-house platform for trading unique tokens was only launched in May and has so far failed to attract a notable number of investors and traders. Accordingly, the management is trying to get customers in every way possible.
As a reminder, Coinbase was at the centre of a scandal the day before. Sources told The Intercept that the platform had opened access to the Coinbase Tracer system to US Immigration and Customs Enforcement officers. The latter is designed to track the activity of cryptocurrency holders and identify them at the same time.
Sources said the platform was initially being used through a licence – it was purchased in August 2021 for $29,000. Then a month later, agency officials pre-purchased the software for $1.36 million.
Coinbase executive Brian Armstrong
Representatives of the platform responded by saying that they only share user information with the authorities when necessary. Although this response has predictably not satisfied the community.
What’s happening to the cryptocurrency industry
So, the Coinbase NFT platform will now get a “Bulk Manage” feature – a tab with likes of tokens, the ability to edit their listing prices, an insider page and a hub for notifications. There’s also a “uniqueness” filter for tokens, the ability to delay posting tokens for sale, a subscriber news feed and the ability to attach up to ten cryptocurrencies to a single account.
According to Decrypt’s sources, the innovations to date have not resulted in a dramatic spike in traffic on the platform. It has had a total of 8,202 unique buyers and sellers since its launch two months ago. They’ve made 20,765 transactions, which has generated a total of 1,486 ETH or $2.9 million in trading volume.
Number of transactions on Coinbase NFT
In comparison, one of the most popular NFT trading platforms called OpenSea has $15.1 million in trading volumes in yesterday alone. However, it has at least 1.9 million users who have made at least one transaction from their account.
Trading volumes on OpenSea
Nevertheless, Coinbase management is not going to give up its support for Coinbase NFT just yet, even though the prospects for a long bearish trend are quite gloomy. Exchange officials said in a recent interview that analysts should not evaluate the platform based solely on the number of transactions and active users. Here’s their rejoinder.
We do not focus only on the number of transactions and trading volumes. There are a lot of people on the platform who interact with each other and use social features. We are in the early stages of beta testing, and we have a lot of new features coming out regularly. Our focus is on getting the community to use these features to make our project more social.
Transaction volume at Coinbase NFT
In May, Coinbase CEO Brian Armstrong said during a conference call on last quarter’s results that he was “pleasantly surprised” by Coinbase NFT’s performance. Incidentally, the company is investing about 10 per cent of its capital in the platform to develop long-term projects.
Read also: Failed crypto platform Celsius wanted to be saved, but eventually changed its mind. Why?
The NFT space itself is going through a bad time right now, with the number of unique token transactions dropping to its lowest level in the last 12 months. There are now an average of about 19,000 NFT transactions per day, worth up to $13 million.
NFT transaction volumes
The same disappointing trend can be seen in the capitalization graph of all NFT collections currently available on the market.
Capitalization of NFT-collections
Recall that the peak in popularity of the sphere came in September last year. On September 21 alone, there were 224,768 NFT transactions totaling $78.3 million. In other words, the figures dropped dozens of times in a few months – which is a pretty bad time to launch a project like Coinbase NFT. However, the field of unique tokens is very much dependent on the situation in the cryptocurrency value market as a whole. Naturally, investors are unlikely to run to buy NFTs while the coin market is in decline. Still, non-interchangeable tokens are a less liquid investment vehicle and therefore more risky.
We believe that the NFT token industry is really going to be in trouble in the near future. Still, many NFTs have problematic liquidity, i.e., when the market crashes there may be no one willing to buy a non-interchangeable token. Consequently, investors in theory own a valuable asset, but without the possibility to exchange it for something else. So, so far there are fewer people willing to invest in NFT - and in the current market conditions this situation is unlikely to change.
What do you think about it? Share your opinion in our millionaires’ cryptochat. We’ll discuss other important news in the blockchain world there, too.
SUBSCRIBE TO OUR CHANNEL ON TELEGRAM. THERE’S EVEN MORE INTERESTING NEWS HERE.
Related posts
