- X2Y2 will shut down on April 30 after hitting $5.6B in NFT trading volume since its launch.
- NFT volume has dropped 90% since 2021, making growth unsustainable for platforms like X2Y2.
- The team is shifting focus to AI and building a permissionless yield-generation platform.
X2Y2, a popular platform for buying and selling NFTs, will cease its operations on April 30, 2025. The project began in February 2022 and rapidly grew into the second-largest NFT market by trading volume before experiencing a decline; its all-time trading volume exceeded $5.6 billion. It remains the third-largest NFT market based on TokenTerminal data.
Decline in NFT Market
The decision to shut down the platform was taken against the backdrop of declining interest in the NFT market. The trading volume of NFTs across the globe has now dropped further by over 90% from its peak in 2021, and platforms have since struggled to sustain this market. The X2Y2 team agreed that network effects, a fundamental input to every marketplace, have decayed over time. Hence, further competition cannot be sustained.
While the marketplace will close, its smart contracts will remain active. Users will still be able to interact with them without any urgency to withdraw or move assets. However, the team clarified that X2Y2 tokens, which were directly tied to the marketplace’s utility, are likely to lose value as a result of the shutdown.
Shift Toward AI
The platform’s closure is not a measure that can be categorized as a temporary halting of activities or the company’s restructuring. However, it is a complete shift from the NFT space to leaning toward a new area of focus, which is artificial intelligence. For the past year, members of the team have been keen to identify ways that AI integrates with crypto to develop better, more sustainable solutions.
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Their next plan is to integrate the use of artificial intelligence to create a permissionless yield-generation platform. This move aims to shift the focus from NFT speculation to actual infrastructure development. The team also stated that this strategy is designed to ensure long-term sustainability through market cycles while consistently delivering significant value.
The exit of X2Y2 from the NFT marketplace may be recognized as a significant episode in the crypto narrative. However, a change in its development towards the use of artificial intelligence represents a shift in the field. Rather than following the hype, the focus is now on building technologies with long-term relevance and impact.
