NFTs are not immortal, but they are transforming — the true face of the market in 2026

At the beginning of the new year, the NFT market, which was declared “dead,” unexpectedly shows signs of recovery. Although this rebound has not yet reached the former glory, it is enough to make steadfast participants feel a touch of warmth they’ve long missed. So, what truths are hidden behind this wave of growth? And what kind of NFTs are the remaining players chasing?

Liquidity Traps Behind Price Rebound

Entering 2026, the NFT market has brought the most optimistic voices in years. According to CoinGecko data, in the first week of the new year, the overall market cap of NFTs increased by over $220 million, with many projects experiencing significant floor price rises, some even recording triple-digit gains. For participants who have endured years of downturn, such a market is indeed precious.

However, the value of this rebound needs careful scrutiny. Rather than a genuine market recovery, it appears to be a reallocation of existing funds within a narrow scope. The Block’s 2025 annual report reveals this: total NFT trading volume for the year was only $5.5 billion, a sharp 37% decline from 2024; total market cap shrank from about $9 billion to $2.4 billion.

More telling is the distribution of transaction data: among over 1,700 NFT projects, only a few have weekly transaction volumes exceeding one million dollars—just 6 projects reached this level; only 14 projects had transaction volumes in the tens of thousands of dollars; even in the $10,000 range, only 72 projects are present. This means the vast majority of NFTs have become “sleeping assets” with little to no activity, with daily trading volumes in single digits or zero for many projects.

The seemingly warming market is fundamentally still experiencing a liquidity shortage. The absence of fresh capital makes this rally more of a “stockpile game” rather than a true growth driven by new capital.

Major Players Retreat and New Directions for Capital

In this prolonged winter, from infrastructure to well-known projects, efforts are underway to seek self-rescue.

Leading marketplace OpenSea has shifted away from trading JPEG images, instead adopting token incentive strategies to focus on derivatives trading; the once prominent Layer 1 blockchain Flow has abandoned its original focus on NFTs and begun exploring DeFi ecosystems; innovative project Zora has disrupted traditional NFT models by introducing the “content as token” concept. Even iconic NFT events like Paris have been forced to suspend operations due to funding issues, becoming embroiled in refund disputes.

Even top projects maintaining some popularity face a huge gap between “fame” and “real value.” Pudgy Penguins successfully gained mainstream recognition, with its physical merchandise selling well, but this popularity did not support an increase in its NFT floor price. The successive sales of NFT businesses by Reddit and Nike further dampened market sentiment.

However, this “escape” does not mean capital is disappearing; rather, it is shifting. Compared to the illusory nature of on-chain virtual assets, the physical collectibles market has attracted substantial capital. The trading volume of Pokémon TCG cards has exceeded $1 billion, with revenues reaching around $100 million; this has attracted not only ordinary collectors but also top figures in the crypto space.

Artist Beeple has turned to creating physical robotic artworks, with his celebrity-themed robotic dog selling out instantly; Wintermute co-founder Yoann Turpin once invested $5 million in purchasing dinosaur fossils; Animoca Brands founder Yat Siu paid a staggering $9 million to acquire a historic Stradivarius violin. These high-value acquisitions reflect the crypto elite’s preference for tangible assets and suggest that traditional assets like violins have appreciated in value in recent years, making them more attractive than the uncertain virtual assets.

All of this indicates that when NFT liquidity dries up, discerning capital is quietly moving toward more tangible and collectible assets.

Classification and Value Rebuilding of New NFT Types

In the process of market selection, not all NFTs are declining. While capital is flowing out, it is concentrating into targets with clear value support or high return expectations.

Speculation and Arbitrage Opportunities: Some aggressive players believe the market has bottomed out and attempt short-term trades based on price mismatches. These operations carry moderate risks and potential rewards.

“Mining Voucher” NFTs: Currently a relatively liquid category. These NFTs are no longer just collectibles but financial instruments for future token airdrops or whitelist access. HyperLiquid’s Hypurr series is a typical example: prices have continued to rise after launch. However, their critical weakness is cyclicality: once snapshots or airdrops are completed, if the project cannot generate new value, the floor price often collapses rapidly. Therefore, they are suitable only as short-term tools.

Endorsements by Celebrities and Top Projects: When well-known figures or top-tier projects endorse NFTs, the power of attention economy becomes evident. For example, when Vitalik recently changed his avatar to a Milady NFT, the floor price of that series immediately surged, demonstrating the influence of prominent personalities.

Cultural IPs: These NFTs have transcended mere hype, with investment logic shifting toward cultural recognition and collection value. The inclusion of CryptoPunks in the permanent collection of the Museum of Modern Art (MoMA) in New York is a strong testament to the long-term value of such NFTs.

Acquisition Revaluation: When strong investors acquire projects, the market re-evaluates their IP monetization potential and brand moat, driving prices upward. Both Pudgy Penguins and Moonbirds experienced significant increases after being acquired.

On-Chain Real Assets: Tokenizing real-world assets anchors NFTs with tangible value. Platforms like Collector Crypt and Courtyard allow users to trade ownership of cards and collectibles on-chain, with items stored by the platform, solving liquidity issues and reducing risks.

Practical Utility: NFTs are returning to their functional attributes, serving specific scenarios—such as event tickets, DAO voting rights, AI on-chain identities (with the launch of Ethereum ERC-8004 standard), and more.

Overall, capital is moving away from “pure images” with no fundamentals toward NFTs with practical use cases or clear value anchors. This shift fundamentally reflects the market’s return from a “gambling paradise” to a “value discovery” phase.