NFTs are coming back but Blue Chip projects are on life support

NFT trading activity showed signs of life in Q3 2025, breaking a long stretch of decline that defined the post-hype years.

After two years of contraction and shifting narratives, on-chain markets found a new footing, not in blue-chip collectibles or speculative art, but in cheaper rails, loyalty programs, and sport-linked assets that traded more on utility than status.

NFT trading volume rose in Q3 2025 and sales counts reached a high.

The center of gravity shifted to cheaper rails and utilitarian use cases as Ethereum’s scaling upgrade pushed activity to L2s, Solana leaned on throughput and compression, and Bitcoin inscriptions matured into a collectibles culture that waxes and wanes with fee markets.

Fees and distribution, not profile pictures, now set the boundary for growth.

Post-Dencun economics reset the map. Ethereum’s EIP-4844 cut data costs for rollups, pushing L2 transaction fees toward cents and enabling gasless or sponsored flows for mainstream-facing mints.

L2 fees fell by more than 90 percent in the wake of the upgrade, a shift already visible in mint behavior and the rise of Base as a distribution rail.

On Solana, compression brought mass issuance into range for loyalty and access use cases, with provisioning costs for 10 million compressed NFTs around 7.7 SOL and median transaction fees near $0.003 even under load.

Bitcoin inscriptions carved out a separate lane tied to mempool cycles and miner revenue, with more than 80 million inscriptions by February 2025 and a top-three position by lifetime NFT sales.

The demand side shows a rebound with a caveat.

DappRadar data shows that Q3 NFT trading volume almost doubled quarter over quarter to $1.58 billion as sales reached 18.1 million, an all-time quarterly high for transaction count.

Sports NFTs stood out, with sales up 337 percent quarter over quarter to $71.1 million, a pocket where schedulable utility, access and loyalty benefits drive spend independent of floor prices. The summer delivered a snapback before a cooldown.

Monthly sales hit $574 million in July 2025, the second-highest month of the year, then fell roughly 25 percent month over month in September as broader crypto risk appetite eased, based on CryptoSlam tallies.

The pattern reinforces a lower average sale value regime and shows how GMV tracks crypto beta even as unique users and utility categories hold up.

Distribution, not just fees, is doing more of the work. Wallets with embedded passkeys and sponsored fees remove onboarding friction that stalled prior cycles. Coinbase Smart Wallet supports passkeys and gas sponsorship in supported apps, and Phantom reported 15 million monthly active users in January 2025, a base that routes into mobile and social mint funnels.

That reach matters on chains where culture and social flows compound. Base is a case in point.

Base overtook Solana by NFT volume on some measures this year as cheap mints, Zora’s mass-mint cadence and Farcaster-adjacent funnels stacked up. The tilt explains why creators weighing where to drop are starting with distribution math, then back-solving into fee profiles.

Royalties no longer anchor the revenue stack.

Creator fees collapsed from 2022 peaks after marketplace wars made royalties optional across much of the market. According to Nansen, royalty receipts hit two-year lows in 2023 and did not recover to prior levels.

The counter-trend is the rise of enforcement-aligned venues. Magic Eden and Yuga Labs launched an Ethereum marketplace in late 2023 that enforces creator royalties, building a protected lane for brands that can command it.

The equilibrium is a bifurcated market, with low take-rates and primary sales, IP deals and retail tie-ins carrying most creator margins, while walled gardens capture premium drops where enforcement is contractual.

Marketplace share remains fluid where incentives drive order flow. On Solana, Magic Eden and Tensor trade leadership in a duopoly that swings with rewards schedules and program design, often ranging between roughly 40 and 60 percent share for each across periods.

This is less a structural change than a function of incentive epochs, which can make share charts look like a regime shift that later mean-reverts. The takeaway for creators is to negotiate distribution as part of launch planning rather than defaulting to a single venue.

Where users actually went tells the near-term roadmap.

Sports, tickets and loyalty programs are scaling because the benefits are schedulable and recurring, and the on-chain primitive, token-gated access, is already embedded in existing ticketing and e-commerce flows.

DappRadar’s Q3 breakouts show sports volumes outpacing the market, and that is before full-season or league-wide programs land.

Gaming is compounding more quietly. Immutable’s zkEVM stack and live metrics show steady transaction growth and a security-on-ETH, UX-on-L2 design that aligns with asset custody and recurring secondary fees, according to Messari.

IP and licensing is the other bridge from JPEGs to consumer channels. Pudgy Penguins’ expansion into more than 3,000 Walmart stores created a live pipeline from NFTs to physical retail and licensing cashflows,.

For creators deciding where to ship next, cost and UX by chain are now legible. ETH L1 still holds provenance and high-value art, with variable gas and optional royalties in most venues.

ETH L2s offer cents-level fees after Dencun, plus sponsored or gasless flows and social funnels on Base and Farcaster.

Solana’s compression brings millions of mints into dollar-level budgets with mobile-first wallet reach. Bitcoin inscriptions line up with scarce collectibles, where fee spikes are a feature, not a bug. The table below summarizes the current journey from mint to trade.

The macro mix is changing as well.

A $5–6.5 billion annualized run-rate in 2025, with average sale values in the $80–$100 range in the first half, sets the base from which next year’s scenarios extend.

Using CryptoSlam monthly sales as the spine and DappRadar category splits for color, a bear case lands at $4–5 billion GMV if crypto beta stalls and average sale values compress, with fee-sensitive use cases concentrated on Solana and ETH L2s, ETH L1 art steady, and inscriptions tracking Bitcoin fee cycles.

A base case in the $6–9 billion band requires embedded wallets and social mint rails to keep expanding, plus sports and live events scaling across seasons and brands testing royalty-enforced venues for new drops.

The bull case at $10–14 billion would need a step-change in mobile distribution, with Base and passkeys normalizing mint flows, Phantom monthly actives trending above 20 million, ticketing pilots moving into mainstream programs and gaming assets recurring.

In all three bands the share mix tilts toward ETH L2 and Solana, with ETH L1 narrower and Bitcoin stable as a collectibles lane.

Six toggles will decide how quickly that flow materializes.

1. Wallet UX and distribution will be the lead indicator, measured by passkey adoption, sponsored fees and MAUs for Phantom and Coinbase Smart Wallet.
2. The footprint of royalty enforcement matters for premium drops, including any OpenSea policy pivots and the health of creator-allied markets on Ethereum.
3. Sports and ticketing partners that move from pilots to season-long programs convert one-off GMV into schedules.
4. Base and Zora cadence, visible in monthly mints and Base’s share of NFT GMV alongside Farcaster Frames, shows whether social funnels sustain.
5. Solana compression adoption, tracked by compressed mint counts and costs per million assets, signals whether loyalty and media programs go from experiments to defaults.
6. Bitcoin fee cycles, and their link to inscriptions and Runes, will keep shaping collectibles pricing as mempool congestion ebbs and flows.

Two risks remain constant. Wash trading and spam minting still distort GMV and sales counts, which is why looking at average sale values and organic-filtered dashboards is the safer approach.

Marketplace incentives can make share charts look like regime change when they are just airdrop cycles, especially on Solana’s duopoly, so launch plans should price that churn in from the outset. The other operational constraint is revenue design.

With royalties mostly optional in open markets, primary sales, IP licensing and retail are carrying more of the load, while enforced venues create a premium lane that some brands can utilize and most cannot.

What looked like an end state in 2023 turned into a migration.

The JPEG boom is over, the rails got cheaper, the use cases now line up with tickets, sports, gaming and IP, and the wallet and distribution stack is starting to meet users where they already are.

The Blue Chip flagship NFT, Bored Ape Yacht Club remains in a perilous state for those who invested six figures into AWS hosted jpegs. The NFT below sold for over 74 ETH in 2021 but is now worth just 9 ETH, an 87 percent decline in three years.

Speculation may be over for the non-fungible sector, but will this finally allow the underlying technology to gain traction in real world utility applications? Only time will tell, but the signs are promising, just not for the bag holders.

Q3 closed with $1.58 billion in trades and 18.1 million sales, and the mix is already moving in that direction.