Trading of Ordinals protocol fungible and NFTs in Bitcoin saw a significant slowdown in January 2024. In the month, there were approximately 481,000 transactions, representing a trading volume close to $335 million.
Instead, December 2023 had been a busy month for Ordinals token trading. This is demonstrated by the volume of USD 868 million registered during that month, with a strong peak of transactions in mid-December.
Percentage-wise, from December to January the drop was 61% in the trading volume of native Bitcoin tokens and NFTs. The total registration of registrations in each month follows the market trend: in January there were just over 6 million registrations, compared to the 7.6 million registered in December.
And the trend seems to continue. In the last 30 days (January 8 to February 8), 210,000 commercial transactions were carried out linked to tokens or NFT Ordinals; It is 56% less than in the same previous period. Likewise, the trade volume of USD 295 million is equivalent to a drop of 66% compared to the previous 30 days.
Possible explanations for the current Ordinals market
When looking for explanations, one can speculate with a market "waiting" for an eventual bull run (that is, a bull run) before or immediately after the Bitcoin halving, which will occur in approximately 60 days. The event, which divides the issuance of bitcoin per block in half, has historically been related to price increases of the main cryptocurrency.
In bullish circumstances, the issuance or “minting” and trading of tokens and NFTs may be more lucrative. Proof of this is the month of December. As the price of bitcoin rose on the imminent approval of bitcoin ETFs (exchange-traded funds) in the United States, activity around Ordinals was boiling . On the contrary, when the dust settled in January, Ordinals also went into standby mode , that is, on hold.
Another reason that cannot be ruled out is that demand has decreased due to mere market dynamics . In fact, such a situation occurred in October 2023 , a month that had the lowest registration records since the creation and popularization of the Ordinals protocol.
