When Formfunction, a Solana NFT marketplace specializing in one-of-one, single-edition artwork, revealed in March of last year that it had secured over $5 million in investment from illustrious backers, the NFT market was flourishing. Nevertheless, a year later, Formfunction announced that it was closing its doors due to shifting NFT industry trends.
The decision was made today, and the business said that its NFT marketplace will close on March 29.
We have some sad news to share today—Formfunction is shutting down on Wednesday, March 29th.
This was an extremely difficult decision; however, after much discussion and careful consideration, we’ve come to the conclusion that we cannot continue to operate Formfunction.
— Formfunction (@formfunction) March 15, 2023
After launching in February 2022, Formfunction revealed the details of its $4.7 million seed investment round the following month. Variant Fund served as the round’s lead investor, with participation from investors including as OpenSea Ventures, Solana Ventures, Pear VC, Canonical Crypto, and Palm Tree Team Crypto.
Since last spring, the NFT market has seen a significant change. With rising pricing for “blue chip” ventures like the Bored Ape Yacht Club and lucrative NFT mints that brought in tens or even hundreds of millions of dollars in sales each month, the broader market was suddenly producing billions of dollars worth of organic NFT trading activity each month.
Nevertheless, as the larger crypto market suffered, demand for high-value NFTs dramatically decreased starting in May of last year, leading to a decline in trading volume and a drop in asset values. DappRadar data shows that between July 2022 and January 2023, the organic NFT trading volume per month was below the $1 billion threshold each month.