Solana NFT trading volume drops after year 00’s migration to polygon
Solana NFT trading volume drops after year 00’s migration to polygon
Solana has experienced a major decline in NFT trading volume following the massive migration of y00t’s NFT collection to Polygon. The process started earlier this week and has seen more than 70% of NFT holders move to Polygon in the largest migration between two blockchains.
y00ts migrates to polygon
Last December, DeLabs Studios, the company behind y00ts and DeGods, Solana’s flagship NFT collections, announced their intention to migrate to Polygon and Ethereum respectively.
At the time, the decision caused massive debate among holders as the collections were seen as distinct from the Solana ecosystem. However, DeLabs justified the action as a move towards making the collections the largest in the crypto industry.
To encourage holders to follow the migration process, DeLabs announced a full refund of network costs within the first 24 hours. Furthermore, holders received a reward of 5 USDC for each year listed on Magic Eden and did not have to pay transaction fees on the collection for a month.
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The migration was expected not to affect volumes at Solana. However, the opposite has happened in recent days. According to data from Magic Eden and OpenSea, about 11,600 NFTs of the 15,000 year collection had been migrated to Polygon.
The floor price of 1.7 ETH represents around $36 million, making it the largest migration of a collection of NFTs between two blockchains.
The context of the migration has also been scrutinized following the news that Polygon paid a $3 million grant to DeLabs Studio. However, Rohun Vora, head of Delabs, refuted this claim by insisting that several large companies – such as Nike and Starbucks – have chosen Polygon.
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Solana is losing ground in NFT’s race
The migration of two of the largest NFT collections from Solana is a major turning point in the NFT war. Solana had previously been seen by many crypto enthusiasts as the most likely to dethrone Ethereum as the leading NFT blockchain.
Its low transaction fees and high scalability had been touted as an alternative to Ethereum, but the expected turnaround has yet to happen. This is because Solana has been plagued by network outages, processing issues and technical issues since its launch.
In addition, the Solana Foundation was strongly supported by FTX and Alameda Research. The bankruptcy of the two entities has had a devastating effect on the blockchain and investors have gradually abandoned ship.
The development of Layer-2 blockchains such as Polygon and Arbitrium has made Ethereum attractive as users can launch NFTs for low transaction fees.
Featured image from Unsplash, charts from Tradingview and Coingecko.
