Bybit closes NFT marketplace due to declining interest

Bybit has announced its decision to close down its NFT Marketplace, Inscription Marketplace, and Initial DEX Offering (IDO) product pages in order to streamline its offerings and improve user experience.

Following a noticeable decline in demand, trading volume, and user activity in the digital collectibles market over the past few years, Bybit is now joining other platforms like Kraken and LG Electronics in exiting this space.

The closure is scheduled for April 8 at 16:00 UTC, and users are advised to transfer their assets from their Bybit web3 wallets before the deadline.

NFT market downturn

Recent trends indicate a decrease in institutional interest in NFTs, with trading volumes for major NFT collections dropping by more than 95% since the market’s peak in 2021. The number of active wallets participating in NFT trades has also declined significantly over the years.

In the first quarter of this year, total NFT sales fell to $1.5 billion, marking a 63% year-over-year decrease from the previous year. High-flying collections like Bored Ape Yacht Club have seen a notable decline in trading volumes, although some projects like Pudgy Penguins and Doodles have managed to buck the trend.

Security concerns

Bybit’s decision to close its NFT-related offerings comes in the wake of a major security breach in late February, where North Korea-linked hackers targeted the exchange and made off with an estimated $1.4 billion in digital assets. Despite efforts to track and recover the stolen crypto, concerns about security risks have lingered.

Bybit’s strategic shift highlights the complex challenges faced by NFT marketplaces, from dwindling demand and security vulnerabilities to operational uncertainties. While niche collections like Pudgy Penguins and Doodles continue to thrive, the overall outlook for the NFT sector appears more subdued than previously anticipated.

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