• The day after Silicon Valley Bank collapsed, the number of active NFT traders dropped to its lowest point since November 2021.
• NFT trading volume has fallen 51%, with sales declining about 16%.
• Yuga Labs’ success has been amplified by its investment in CryptoPunks as well as by its ability to build a community.
Tanked NFT Trading Volumes After Silicon Valley Bank Collapse
On Saturday, the day after the Federal Deposit Insurance Corp. took control of Silicon Valley Bank, there were only 12,000 active NFT traders – a low not seen since November 2021 – according to DappRadar. Single NFT trades totaled 33,112 on that day; a 51% decrease from the beginning of March and a 16% decline in sales.
Yuga Labs Proves Resilient Despite Market Drop
Despite the overall market drop-off, projects from NFT issuer Yuga Labs have proven resilient and their floor prices dipped slightly on Saturday before quickly recovering. One Twitter user even compared CryptoPunks to USDC – claiming it was more stable than the stablecoin which lost its peg to the U.S dollar after Silicon Valley Bank’s collapse – demonstrating Yuga Labs’ ability to remain consistent amid market turbulence.
Yuga Labs’ Success Driven By Community Building
Sara Gherghelas, a research analyst at DappRadar, said that Yuga Labs’ success has been amplified by its investment in CryptoPunks as well as by its ability to build a community. Although the company said it had limited exposure to Silicon Valley Bank, its token holders didn’t make major moves on the news. This is due in part because of their loyalty and trust in Yuga Lab’s team and product offerings built up over time through effective community engagement strategies such as engaging with users directly via social media channels or hosting events for them virtually or offline.
What Can We Learn?
This incident demonstrates how important it is for companies dealing with digital assets like NFTs to form strong relationships with their customers and investors through effective communication strategies so they can remain confident even when external factors are volatile or uncertain. Additionally, understanding your exposures can help protect you against unexpected losses in times of crisis such as this one where financial institutions may become unstable or fail suddenly without warning leaving those involved vulnerable if they haven’t taken measures against it ahead of time.
Conclusion
In conclusion, this article shows us how important it is for companies dealing with digital assets like non-fungible tokens (NFTs) to form strong relationships with their customers and investors through effective communication strategies so they can remain confident even when external factors are volatile or uncertain and also understand their exposures so they can protect themselves against unexpected losses when faced with crises involving financial institutions becoming unstable or failing suddenly without warning leaving those involved vulnerable if they don’t take preventative measures ahead of time.