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The global non-fungible token (NFT) sector fell below $1.5 billion in total market capitalization, returning to levels last seen before the sector’s rapid expansion in 2021.&nbsp;
The retracement unfolded alongside a broader crypto market downturn over the past two weeks, CoinGecko data <a href="https://www.coingecko.com/en/charts" rel="noopener noreferrer nofollow">shows</a>. On Jan. 23, total crypto market capitalization stood at about $3.1 trillion, before falling to $2.2 trillion on Friday.
Major assets like Bitcoin (<a href="https://cointelegraph.com/bitcoin-price" rel="noopener noreferrer nofollow">BTC</a>) slid from around $89,000 to about $65,000, while Ether (<a href="https://cointelegraph.com/ethereum-price" rel="noopener noreferrer nofollow">ETH</a>) fell from $3,000 to near $1,800 throughout the same time frame. Bitcoin and Ethereum are the top two networks for NFTs in terms of 30-day trading volume, <a href="https://www.cryptoslam.io/nftglobal" rel="noopener noreferrer nofollow">according</a> NFT data aggregator CryptoSlam.
The NFT market cap drop follows several high-profile closures and exits, highlighting the sector’s continued contraction.&nbsp;
<figure><img src="https://s3.cointelegraph.com/uploads/2026-02/019c32c3-4fc8-7ec0-9a5a-2e7bc20ee279.jpg" title="" alt="NFT market cap slides back to 2021 pre-hype levels, near $1.5B">
 <figcaption>Total NFT market cap chart. Source: CoinGecko
 </figcaption>
</figure>
<h2 id="rising-supply-collides-with-falling-demand">Rising supply collides with falling demand</h2>
The market reset has been compounded by a growing imbalance between NFT supply and buyer demand.&nbsp;
As reported by Cointelegraph on Dec. 31, total NFT supply <a href="https://cointelegraph.com/news/nft-supply-growth-sales-decline-2025" rel="noopener noreferrer nofollow">continued to expand</a> even as sales and prices declined, pushing the sector into a high-volume, low-price structure.&nbsp;
CryptoSlam data showed that the number of NFTs in circulation rose to nearly 1.3 billion in 2025, up by 25% compared to 2024. Total NFT sales fell 37% year-over-year to $5.6 billion, while average sale prices slipped below $100.&nbsp;
The divergence suggests that while minting became cheaper and barriers to issuance fell, buyer participation and spending failed to keep up.&nbsp;
Related: <a href="https://cointelegraph.com/news/doj-drops-opensea-manager-nft-insder-trader-case" rel="noopener noreferrer nofollow">US prosecutors drop OpenSea NFT fraud case after appeals court reversal</a>
<h2 id="corporate-exits-and-platform-closures-add-pressure">Corporate exits and platform closures add pressure</h2>
The drop follows a series of high-profile retreats that mirror the market's pullback. On Jan. 7, footwear giant Nike <a href="https://cointelegraph.com/news/nike-quietly-sells-rtfkt-nft-exit" rel="noopener noreferrer nofollow">quietly offloaded RTFKT</a>, the digital collectibles studio it acquired at the height of the NFT boom.
The reported sale followed the company’s decision to <a href="https://cointelegraph.com/news/nike-owned-nft-project-rtfkt-close-2025" rel="noopener noreferrer nofollow">shut down operations</a> amid an investor lawsuit.
In addition, marketplace shutdowns have accelerated. Nifty Gateway, one of the earliest NFT platforms, said it will close on Feb. 23 and has <a href="https://cointelegraph.com/news/nifty-gateway-shutdown-nft-marketplace-closure-2026" rel="noopener noreferrer nofollow">entered withdrawal-only mode</a>. The Gemini-owned platform cited a prolonged market downturn as it winds down.
On Jan. 28, social NFT platform Rodeo <a href="https://cointelegraph.com/news/rodeo-becomes-2nd-nft-platform-announce-closure-this-week" rel="noopener noreferrer nofollow">announced it would cease operations</a> after failing to scale sustainably. Rodeo said it would transition to read-only mode before shutting down entirely in March.
Magazine: <a href="https://cointelegraph.com/magazine/digital-art-snoop-dogg-flamingo-dao-9-figure-nft-collection/" rel="noopener noreferrer nofollow">Digital art will ‘age like fine wine’: Inside Flamingo DAO’s 9-figure NFT collection</a>

NFT market cap slides back to 2021 pre-hype levels, near $1.5B

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