Will the proud OpenSea regret the 10 billion dollar market value being “wasted”?
Author: Terry
In just two years, from ignorance to a valuation of over 13 billion US dollars, then another two years, from 10 billion US dollars to a “toe cut” of 90%, to the point of considering selling it. What kind of experience would it be to have the ups and downs of what seemed like a “roller coaster”?
This is exactlyOpenSeaIn the most realistic picture of the past 4 years — not long ago, Devin Finzer, CEO and co-founder of OpenSea, revealed,OpenSea has received takeover offers and remains open to potential takeover deals, but has not specified when and by whom.
As a “unicorn” level entity that was once almost out of order in the NFT trading market, how did OpenSea rise rapidly, and how did it fall to the front row in the NFT market competition, and what potential disruptors and variables will the next NFT market landscape usher in?
01
OpenSea: A unicorn valued at over 10 billion dollars, now “cut its toe”
withUniswapLike Dune, OpenSea is also an entrepreneurial miracle in the Web3 field that started from zero and rose rapidly --In particular, in the two years starting in 2021, OpenSea's valuation was a breakthrough, climbing from one point no one paid attention to $13 billion, and became the “stable leader” in the entire NFT market.
The story begins in January 2018, when Devin Finzer and Alex Atallah, the two co-founders of OpenSea at the time, created OpenSea for users to buy and sell NFTs.
However, the platform's NFT trading users and trading volume have been hovering at a low level since the entire NFT market is still barren, in addition to the Cryptokitties that have sparked short-term hype.
Until March 2020, OpenSea had only 5 employees, and the monthly transaction volume fluctuated around $1 million. Based on 2.5% commission at the time, this meant that the monthly revenue was only $28,000. Thanks to Animoca Brands's investment of $2.1 million at the end of 2019, OpenSea was able to maintain its financial balance.
OpenSea's real take-off began in 2020, and the two co-founders planned to double their business volume by the end of 2020. Unexpectedly, along with the gradual recovery of the crypto market starting in the second half of 2020, OpenSea's business volume soared rapidly, and completed this task ahead of schedule in September 2020.
Beginning in 2021, the big NFT bull market began. The number of active users and trading volume of OpenSea skyrocketed. In July 2021, the transaction volume surged to $350 million, and received $100 million in financing led by a16z, with a post-investment valuation of 1.5 billion US dollars.
A month later, in August 2021, OpenSea's trading volume soared tenfold again, reaching $3.4 billion and receiving over $85 million in commission revenue.
From then until January 2022, OpenSea was almost unshakable, with a monthly transaction volume of more than 3.5 billion US dollars, accounting for 90% of the market share of the NFT industry, and the highest valuation was over 13.3 billion US dollars, so from a data perspective,OpenSea is definitely “too big to fail” in the entire NFT market, and even far exceeds Uniswap's market share and influence on the DEX circuit.
OpenSea's monthly trading volume from 2022 to 2024
And this has also become a standout song for OpenSea to dominate the NFT trading market. As a pioneer who first laid out the NFT trading market and completely reaped the dividends,OpenSea's transaction volume plummeted in June 2022:
From a sharp drop of nearly $2.6 billion in May to less than $700 million in June, OpenSea's monthly transaction volume has now been reduced to $120 million, down more than 95% from its peak in January 2022.
According to Bloomberg, citing people familiar with the matter, Tiger Global Management has now reduced the value of its shares in OpenSea by 94%, while Coatue has also reduced the value of its OpenSea shares by 90% to $13 million, almost all of them “cut to the bottom.”
02
The evolution of the NFT circuit landscape
The one that brought the biggest blow to OpenSea was Blur, the new hegemon, which now accounts for over 70% of the NFT trading market.An NFT platform launched at the end of 2022, quickly surpassed OpenSea in less than a year and became the largest NFT marketplace through Airdrop Token.
Dune data shows that the NFT market had passed in the past week at the time of publicationBlurWith a share of 73.7%, Opensea ranked first; Opensea ranked second with a share of 21.7%.
Market share of NFT trading platforms
If we look back at the evolution of the NFT circuit landscape and Blur's extremely strong ability to “disrupt the game,” we'll find that none of the changes come as a surprise.
LooksRare, x2y2's 'Vampire Attack'
First, the miracle of the rise of OpenSea is partly inseparable from its first-mover advantage, which it persevered at a low point in the early days.And after the NFT bull market broke out, product-level competition and “vampire” attacks between the NFT trading markets almost never stopped against OpenSea's dominant position.
As we all know, there's a clear trend in the Web3 and crypto world right now, whether it'sDeFi, NFTs, chain games, or infrastructure,There are more and more similar projects, but homogenization competition is serious, and everyone's differences are almost limited to differences in names, UI, token incentives, transaction fees, etc.
“In market competition, it doesn't matter who copies who comes first,” this is especially true in Web3. This is especially true in Web3, and this view has been proven over and over again since Sushi's vampire attack on Uniswap back then.
So starting in 2022,像 LooksRare、x2y2Once the “OpenSea Killers” started to focus on OpenSea's delay in issuing tokens, they gained a comparative advantage for a while with the incentive form of token distribution, but the completion of Airdrop's internal volume did not really shake Opensea's position.
Almost all of these transaction reward mechanisms triggered a large number of false purchases, and after a short period of prosperity, they quickly fell silent, and did not run away from strong competitors that actually shared the NFT market share.
Blur: the real “wall breaker” of the NFT circuit
At the end of 2022, Blur appeared and launched Bid Airdrop (Bid Airdrop is a marketing strategy in a crypto asset project that aims to distribute tokens to participants by participating in auctions or bids), which completely solved the problem of insufficient depth in the NFT market:
Encourage bids (make offers). The closer the bid is to the floor price (floor price), the more rewards. “Essentially, the leek of the secondary market takeover platform Token is subsidizing bidders”. This is also similar to Aave's rise path — an agreement that helps large players “ship” is a good agreement.
Looking at the development trajectory over the past year, Blur and its founder Tieshun can be described as the top “wall breakers” on various “mature racetracks”:
The NFT trading circuit:Blur disrupted OpenSea, which has taken a firm seat in Diaoyutai, from a valuation of $13.3 billion to a valuation of $1.4 billion;
Using NFTs as a racetrack:Blend loan transactions totaled more than US$4.6 billion, making it the leading leader;
L2 track:Blast's TVL surpasses $1.78 billion, second only to L2Beat statisticsArbitrum($12.34 billion) andoptimism($6.6 billion), higher than a series of other L2s such as Base and zkSync, ranking in the top three L2.
03
New trends in the NFT market
Since 2023, in addition to Blur completing the “replacement” of OpenSea, a number of potential variables have emerged.
First, of course, the rise of pan-Bitcoin NFTs represented by Ordinals has set off a new wave of “BitcoinFi,” and the activity of transactions within the Bitcoin ecosystem has reached a new peak.
According to Cryptoslam data in the chart below, Bitcoin's on-chain NFT sales reached US$238 million in the past 30 days, making it the second-largest blockchain in NFT sales, afterEthereum($456 million), higher thanSolana($232 million) andPolygon($5.03 million).
According to Dune's latest data, as of February 16, the cumulative cost of minting the Ordinals inscription exceeded 6150 BTC, or more than $320 million.
This also spawnedOKXWith the rise of Bitcoin NFT trading markets such as the Web3 wallet ordinals market and UniSat NFT trading market, the total transaction volume of the OKX Web3 wallet ordinals market has also exceeded 1.3 billion US dollars as of last week.
Furthermore, beginning in the second half of 2023, the NFT market seems to have gradually stabilized. The floor prices of many blue-chip NFTs have begun to rebound or soar one after another, and the Solana ecosystem's NFT circuit has ushered in a new hype cycle.
At the same time, various NFTs with similar inscriptions, such as ERC404, have re-emerged as “new assets” with dual characteristicsSuch NFTs can be traded on both OpenSea and Uniswap, which may also have a greater impact on the NFT market landscape in the future.
In particular, before, Uniswap had acquired the NFT trading market Genie and sent a clear signal to enter the NFT trading market—Genie aggregates transactions in other NFT markets, and Uniswap provides transaction depth.
Overall, competition in the NFT market has always revolved around product dimensions and asset dimensions:
Through product-level innovation in the liquidity reward mechanism, Blur reduced the size of the first half of 2023 to crack down on the old generation of NFT trading platforms such as OpenSea and x2y2;
Meanwhile, OKX, UniSAT, etc. also rapidly rose in the second half of 2023 with the new asset class of inscriptions, opening up new territories;
As a new asset type, at the beginning of 2024, ERC404, which continues to rise in popularity, will it also give traditional token trading agreements such as Uniswap new tickets to the NFT market, thereby stirring up the 2024 NFT market pattern? It is worth paying attention to.
