This calendar month, Cointelegraph Research will release a comprehensive written report on nonfungible tokens, discussing NFTs in detail and providing a detailed guide to getting into this market place.

In collaboration with multiple partners — including Enjin, NFTBank, The Sandbox and others — the report will evaluate the technology behind NFTs, their regulatory challenges, and their prospective growth and current marketplace positions. The report will also outline the hurdles that the market may run across in the hereafter, and potential ways to overcome them.

At the offset of 2022, there was increased interest in NFTs, with the largest NFT marketplace, OpenSea, experiencing a hundredfold sales increase in half a yr. The full volume of NFT sales reached $ii.v billion in the first half of 2022, almost eight times the total corporeality in all of 2022.

Being the market leader, OpenSea mainly uses Ethereum, although Polygon and Klaytn are also available. Other marketplaces too allow for the use of alternative blockchains, but Ethereum has dominated the infinite during the terminal few months, representing weekly at to the lowest degree 97% of every NFT market sector, including games, collectibles and marketplaces.

However, despite Ethereum's electric current superiority, there is a range of pregnant competitors in the market place. As tin be seen in the below graph of total NFT sales and traders, the Worldwide Nugget commutation (WAX), Polygon and Catamenia correspond formidable oppositio. Thus far in 2022, every 3rd trader has used Flow and every quaternary trader has used WAX, although almost 90% of total sales this yr have taken place on Ethereum.

Chiefly, the refuse in trading volume on Ethereum at the beginning of the year was mainly caused past NBA Peak Shot, Dapper Labs' NFT collectibles project based on the Flow blockchain, which generated approximately $500 meg and attracted more than than 800,000 users in the kickoff quarter. Even so, over the longer term, Flow did not succeed in securing a significant marketplace share, despite its lower gas fees (cents vs. tens of dollars) and higher number of transactions per second.

Although WAX only has accounted for effectually $100 million in sales in 2022 (slightly more than ane%), its website states that it is backed past multiple top-tier companies, including Google, Atari, Funko, Topps, etc.

Considering the sector's large number of unique traders and the potential to grow through the release of new NFT collectibles and games in partnership with well-known companies, activity on the WAX blockchain may increase in the future. Moreover, the simplicity of NFT transactions on WAX may attract new traders, increasing sales fabricated via the blockchain. However, its superlative of action ($15 one thousand thousand sales per week) occurred in the middle of April. Since then, the blockchain has been processing between $two million to $iii meg in sales weekly, and it is unclear whether those figures will rise soon.

Related: Why NFTs can be a riskier investment than cryptocurrencies — Written report

In contrast with Flow and WAX, Polygon has managed to obtain steady, rapid growth over a more than extended catamenia, lately generating the majority of its sales through such marketplaces as OpenSea and Aavegotchi'southward Baazaar. The popularity of Polygon outside of the NFT market, combined with low gas fees ($0.01 to register an NFT on OpenSea vs. $230 with Ethereum), may stimulate NFT marketplace activity on the Polygon blockchain in the long term.

Other notable blockchains — such as Waves (known for the Waves Ducks game), Binance Smart Chain and Tezos (known for Hic Et Nuc, a crypto art NFT platform) — are nowadays in the market notwithstanding have deemed for less than ane% of all NFT sales in 2022. In that location are too other blockchains that are just now entering the infinite, such equally the Devvio blockchain, which focuses on play-to-earn gaming.

Yet, the activity on a particular blockchain is highly dependent on the bewitchery of the collectibles and games released on information technology. This gene may exist tough to predict, and one should inevitably consider this earlier making any investment.

This commodity is for information purposes only and represents neither investment advice nor investment analysis, nor an invitation to buy or sell fiscal instruments. Specifically, this document does not serve equally a substitute for individual investment or other advice.