Bybit to Shut Down NFT Marketplace as Industry Decline Continues

Crypto exchange Bybit has announced the closure of its NFT Marketplace, Inscription Marketplace, and IDO product pages, joining a growing list of platforms exiting the struggling NFT sector. The marketplace will officially shut down on April 8, with users advised to manage their assets before the deadline, according to an April 1 statement from the company.

Bybit’s NFT Shutdown Follows Major Hack

Bybit’s decision comes amid the aftermath of a massive security breach in February, which saw the exchange suffer a $1.4 billion hack—the largest crypto theft to date. The FBI linked the attack to North Korean hackers, further compounding Bybit’s challenges.

Bybit's move mirrors decisions by other major platforms that have struggled to sustain NFT trading volume, which has plummeted by 90% since its 2021 peak.

Industry-Wide NFT Market Decline

Bybit is not alone in shutting down NFT operations. Other major firms have recently made similar announcements:

• X2Y2, a once-prominent NFT marketplace that processed $5.6 billion in lifetime trading volume, announced last week that it was winding down operations. The platform cited shrinking NFT demand and the lack of strong network effects in the marketplace sector.
• Kraken closed its NFT marketplace on February 27, redirecting resources toward other crypto initiatives.
• Nike-owned RTFKT ceased operations in January following a steep drop in the value of its NFT collections.
• LG Art Lab, LG’s NFT platform, will shut down on June 17, with the company stating it is shifting its focus to new opportunities.

NFT Market Faces Heavy Losses

Once hailed as a revolution in digital ownership, the NFT market has struggled to recover from the crypto winter. The floor prices of once-prestigious collections have nosedived:

• CryptoPunks’ cheapest NFTs now trade at 42.59 ETH, down 66% from their 2021 peak of 125 ETH.
• Bored Ape Yacht Club (BAYC) NFTs have plummeted 90%, dropping from 153.7 ETH in May 2022 to just 15.35 ETH today.

With the NFT hype cooling off, platforms are now pivoting to other areas, such as AI and blockchain gaming, in search of new growth opportunities.

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