Kraken, a US crypto exchange, has announced that it ill shut down its NFT marketplace. The closure comes amidst changing priorities by the exchange. According to reports, Kraken plans on investing in different projects some of which it has not announced yet.
Starting 27 November 2024, the platform will shift to a withdrawal-only mode. The full closure will take effect on 27 February 2025 upon which creators and investors will not be able to list, bid or sell NFTs.
In a statement, a Kraken representative stated, “we have made the decision to close our NFT marketplace so we can shift more resources to new products and services, including unannounced initiatives in development.”
BREAKING: Kraken to shutter its NFT marketplace pic.twitter.com/5Wa4ZpTOxz
— Bryptos (@Bryptos_) November 26, 2024
Kraken’s NFT Journey and Reasons for NFT Market Exit
Kraken first revealed its plan to venture into NFTs in 2021 during a time when digital art was gaining popularity. By November 2022, the exchange launched its NFT marketplace in Beta. However, the crypto exchange has fallen short of its promises due to the prevailing decline in NFT sales.
According to data from Non Fungible, the number of NFT sales per USD has been on a downward trend from April 2024. The NFT sales have been unable to reach above $100 million in the same period. This data clearly indicates the NFT market has been struggling off-late.
Source: Nonfungible.com
The decline in NFT sales has been one of the major reasons as to why Kraken has decided to opt out of the Non-Fungible Token market. Further to this, the exchange argues that it has other investment plans which are fit to the company’s mission.
What NFT Owners Need to Do To Avoid Losses
With the announcement that Kraken will close its NFT marketplace for good on 27 February 2024, creators need to start withdrawing their digital arts. This means that NFT owners have exactly three months to remove their digital art collections from the marketplace. During the transition period, Kraken has promised to offer support to its users through helping them withdraw their NFTs.
In the notice sent to users, the Kraken representative said, “we understand that you may require additional support and our team is here to assist you. If you have any questions or need guidance on withdrawing your NFTs, please don’t hesitate to reach out to Kraken Support.”
The exit by Kraken underscores the fact that the NFT market is struggling. The move could result in further market movements. There is also heightened worry amongst NFT enthusiasts as the bubble around digital art is fading away.
obr4nl