Analysis: GameStop’s NFT Trading Slows in the Market’s First Week

enlarge / If GameStop’s NFT business is going “over the moon”, then the overall trading volume on the platform has bent in the wrong direction so far…

Last week, when Ars analyzed the first day of NFT sales on GameStop’s highly publicized crypto market, some boosters were quick to suggest that this was just a starting point and that interest and trading volume could increase over time and as more and more people the exchange platform. However, in the first week of the market, interest in trading GameStop NFTs seems to be waning compared to the performance of this launch day.

An exclusive analysis by Ars of the GameStop NFT marketplace now shows that it was responsible for approximately 5,254 ETH in total trading volume in the first week (worth approximately $7.8 million at exchange rates). current exchange rates). This represents a daily average of about 750 ETH ($1.117 million) in total trading volume. GameStop charges a 2.25% fee for all such transactions, which equates to a daily average of 16.9 ETH ($25,113) in direct revenue for the company. In total, six of the more than 300 collections on the platform are responsible for the majority of this trading volume.

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(Note: Ever-volatile ETH prices are up ~38% since last Tuesday, when Ars conducted its market analysis on launch day. Unless otherwise noted, we’re using the current ETH spot price – $1,488.06 at the time of writing – for conversions here, although trades earlier in the week likely took place at lower USD/ETH rates.)

The average daily trading volume in the first week is a significant slowdown from the market’s launch day, when it processed 1,831.81 ETH in total trading volume (worth about $1,976 million at the time or $2,725 million at current rates), according to analysis from Ars. . On that first day, GameStop made about 41.2 ETH in transaction fees (worth about $44,500 then or $61,331 today).

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enlarge / The “GameStop Astronaut MetaBoy” NFT is one of the most popular to hit the market recently, with a total trading volume of 163 ETH in less than a week.

Of the hundreds of NFT collections that showed some trading activity on the first day of trading, the median collection saw the average daily volume in the first week of trading (compared to the daily volume) of launch decrease by approximately 50%. This does not include 34 collections that have not yet seen a single trade on the market, 25 of which have been available since day one.

And the dozens of new NFT collections on the market (ie those that saw their first trades after the day of the market launch) don’t bridge that gap. These approximately 85 collections are only responsible for 556 ETH of the total trading volume in the past six days (approximately $828,575).

The wrong direction

However you break it down, overall activity on the GameStop NFT Marketplace slowed in the days following the service’s launch. Perhaps that’s not surprising, given the months-long pent-up demand among crypto bulls and GameStop stock enthusiasts sparked on the platform’s launch day last Monday. It’s also not surprising in the context of the broader NFT market, where a top market like OpenSea has seen daily trading volume drop by about 90% since its peak in January.

Nevertheless, the delay is a setback for GameStop and crypto boosters who hope the introduction of NFT trading can revolutionize GameStop’s physical and physical-centric business model. For now, if trading on the GameStop NFT Marketplace remains at the same weekly rate, it will see a total trading volume of approximately 273,000 ETH in its first year. That’s about $406 million today, or about 6.75% of GameStop’s $6.011 billion in net sales for fiscal 2021.

Of this volume, GameStop will charge approximately 6,147 ETH in transaction fees (approximately $9.15 million), which is only approximately 0.15% of GameStop’s net sales for fiscal 2021 or 2.4% of the loss of $ 381 million for fiscal 2021. if HODL game stop all its ETH and cryptocurrency returns to its all-time high of about $4,800, and then that annual transaction fee will be worth just $29.5 million (about 0.49% of net sales in fiscal 2021; 7.7% tax losses in 2021) .

Of course, it’s no small feat to make tens of millions of dollars a year from a whole new industry, especially if GameStop doesn’t have to worry about a lot of inventory or physical overhead to sell. Still, it’s not the kind of profitable performance that will seriously impact a multi-billion dollar company in the long run.

However, this is still the start of GameStop’s NFT business and the broader NFT market could still recover from the current slump. Or perhaps the eventual integration of “web3 game” assets into the GameStop marketplace (which the retailer says will be “added over time”) will help it “consolidate itself as the ultimate destination in the world.” new gaming paradigm,” as Immutable’s Robbie Ferguson suggested when announcing a deal with GameStop in February.

For now, though, GameStop and its boosters will be watching and waiting for such a turnaround. Until that happens, the GameStop NFT marketplace seems destined to be a relatively small part of the international retailer’s business in the future.

List image by MetaBoy / GameStop NFT Marketplace

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