The secondary NFT market is growing at a very fast pace.
The primary NFT market, particularly in the art world, has set numerous records, with many artists managing to sell digital works at very high prices at times.
But for those who buy these NFTs directly from the artists, it still does not seem at all easy to resell them at prices higher than those on the primary market.
According to the creator of the data-tracking site Crypto Art, and partner of the crypto investment firm 1Confirmation that invests in NFT art, Richard Chen, the secondary market for NFTs is growing at a rapid pace, but it is still mainly focused only on the most highly rated artists, and not on the long tail.
The secondary NFT market
Chen reveals that for blue-chip artists, such as Pak, Hackatal or XCOPY, the selling price on the secondary market is usually higher than the primary sales, but only because the base price is increased.
However, for the long tail, i.e. 99% of the other artists, the prices are only slightly higher.
For example, XCOPY’s NFT, Reflection, was sold for a fortnight on the primary market for $98,500 and then resold on the secondary market for $872,500.
For this reason, Chen believes there are signs that there is a bubble in the NFT market, particularly for some mass-consumption projects such as NBA basketball trading cards, noting that much of the excitement seems to be waning.
Chen believes that smart collectors are now realizing that the NFTs that will remain valuable in the long term are those that are brought to market by artists who truly understand their function, and who will continue to use them appropriately.
According to Crypto Art, the secondary market has increased dramatically in size over the past three months, with SuperRare’s secondary market now the second-largest NFT market in the world, accounting for 36% of total sales volume. In particular, it is growing much faster than the primary market, thanks mainly to the most popular artists.
So although this market, in which NFTs bought directly from artists can be resold, is still in its infancy, and although there is probably a bubble going on right now, the future could be bright, especially thanks to a number of specialized artists who are innovating the art world.