The NFT market crisis is gaining momentum: crypto exchange Gemini is shutting down Nifty Gateway.
NFT Market Crisis Gains Momentum: Cryptocurrency Exchange Gemini Shuts Down Nifty Gateway
Cryptocurrency exchange Gemini, founded by the Winklevoss twins, has announced the discontinuation of the NFT marketplace Nifty Gateway. The platform, acquired back in 2019, has entered a withdrawal-only mode and will permanently close on February 26. This decision serves as another alarming signal for the non-fungible token market, which is experiencing a prolonged downturn.
In 2021–2022, NFTs experienced a real boom. The market was rapidly growing at the time, attracting attention from both investors and celebrities. The startup OpenSea reached a valuation of $13 billion, becoming the industry's flagship. At the peak of popularity, individual tokens like CryptoPunks and Bored Ape Yacht Club sold for tens of millions of dollars. Active promotion of NFTs by stars—from Tom Brady to Paris Hilton—fueled the hype. However, warnings were already being sounded back then: Hilton's appearance on The Tonight Show Starring Jimmy Fallon discussing NFTs was later criticized for lacking warnings about investment risks.
Since 2022, the market began to contract rapidly. Evidence of overheating came from the unsuccessful launches of NFT platforms by major players. Coinbase, despite previous statements about preserving the project, closed its marketplace in 2024. A similar fate befell the Kraken platform—it was wound down due to lack of demand. OpenSea attempted to adapt by pivoting to a multi-chain cryptocurrency trading aggregator.
Statistics eloquently demonstrate the scale of the collapse. The CryptoSlam 500 NFT Index, tracking the largest projects, has plummeted by 98.98% since its launch four years ago. While weekly sales reached over $1 billion in 2021–2022, by early 2026 this figure had fallen to less than $60 million, according to data from The Block.
The NFT market was accompanied by high-profile scandals. A number of celebrities became involved in a lawsuit related to Bored Ape NFTs. Another notable case was the sentencing of an OpenSea employee to three months in prison for insider trading. Recently, attention was drawn to Coinbase's stunt of deleting a token worth $25 million, once again highlighting problems with insider trading in the crypto industry.
Attempts to revive interest in NFTs have so far yielded no results. Some projects tried migrating tokens to the Bitcoin blockchain via the Ordinals Inscriptions protocol, embedding images directly into the blockchain. However, these initiatives failed to replicate the success of 2021–2022 and sparked debates about "spam" on the Bitcoin network.
Amid the decline of NFTs, interest in memecoins has grown, partially replacing tokens as speculative assets. But problems persist here as well: lawsuits over scams continue. For example, former New York City Mayor Eric Adams was accused of participating in one such scheme. Meanwhile, certain figures, including President Trump, have managed to profit from both NFTs and memecoins.