Kraken, an American cryptocurrency exchange, announced that it had fraudulently shut down its NFT market. The closure comes amid a change in priorities by the exchange. According to reports, Kraken plans to invest in various projects, some of which have not yet been announced.
From November 27, 2024, the platform will move to withdrawal-only mode. The complete shutdown will take effect on February 27, 2025, and creators and investors will no longer be able to list, bid on, or sell NFTs.
“We have made the decision to close our NFT Marketplace in order to shift more resources to new products and services, including unannounced initiatives that are in development,” a Kraken representative said in a statement.
Breaking news: Kraken to shut down NFT marketplace pic.twitter.com/5Wa4ZpTOxz
— Bryptos (@Bryptos_) November 26, 2024
Kraken’s NFT journey and reasons for exiting the NFT market
Kraken first revealed plans to enter NFTs in 2021, when digital art was gaining popularity. By November 2022, the exchange launched an NFT marketplace in beta. However, crypto exchanges have failed to deliver on that promise due to a general decline in NFT sales.
According to data from Non Fungible, NFT sales per USD have been on a downward trend since April 2024. NFT sales failed to exceed $100 million during the same period. This data clearly shows that the NFT market is struggling in the late stages.
Source: Nonfungible.com
Declining NFT sales is one of the main reasons why Kraken decided to exit the non-fungible token market. In addition to this, the exchange claims that it has other investment plans that fit the company's mission.
What NFT owners should do to avoid losses
With Kraken's announcement that it will permanently close its NFT marketplace on February 27, 2024, creators should begin exiting their digital art. This means NFT owners have exactly three months to remove their digital art collections from the market. During the transition period, Kraken has committed to providing support to users by helping them withdraw their NFTs.
In a notice sent to users, a Kraken representative said: “We understand that you may need additional support, and our team is here to help. If you have any questions or need guidance on withdrawing your NFTs, please feel free to contact Kraken Support Please contact us.
Kraken's exit highlights the fact that the NFT market is struggling. This move could lead to further market fluctuations. NFT enthusiasts are also growing anxious as the bubble surrounding digital art is disappearing.
