NFT Markets in 2025: What Survived the Crash and What Switzerland's Collectors Are Buying

NFT Markets in 2025: What Survived the Crash and What Switzerland’s Collectors Are Buying

Between January 2021 and May 2022, the NFT market experienced one of the most rapid asset price cycles in modern financial history. Monthly trading volume on major Ethereum-based platforms climbed from roughly $10 million in January 2021 to over $5 billion in January 2022. Artists who could not sell prints for $50 were selling JPEG files for $69 million. Swiss private banks were fielding calls from UHNW clients asking how to buy a Bored Ape. Gallerists in Zurich who had dismissed crypto as a fad were attending blockchain art fairs with notebooks.

The collapse was proportionate to the ascent. Monthly trading volumes fell by over 95% from the January 2022 peak through late 2022. The vast majority of NFT collections — which at peak commanded floor prices of tens of ETH — fell to near-zero trading activity. Projects that had raised millions in primary mint revenue had exhausted those funds before building anything of lasting value. The “profile picture project economy” — where value derived entirely from social signalling and speculative expectation — proved to have no floor when speculation turned.

What survived the destruction was more interesting than what was destroyed.

The Peak and Its Characteristics: 2021-2022

The 2021 NFT bull market had several distinct phases with different dominant dynamics:

The Genesis Phase (January-March 2021): Early Ethereum NFT collections — CryptoPunks (launched 2017, 10,000 pixel art characters originally free to claim), Hashmasks, Art Blocks Curated — reached price levels that established the market’s first benchmarks. Crypto investors who had accumulated wealth through 2020’s crypto rally rotated into NFTs as a novelty and collectible.

The Mainstream Moment (March-August 2021): Beeple’s “Everydays: The First 5000 Days” sold at Christie’s for $69.3 million in March 2021, generating global press coverage that introduced NFTs to audiences who had never engaged with cryptocurrency. The profile picture (PFP) format — 10,000 algorithmically generated variants of a character, sold as a collection with social identity signalling — became the dominant commercial format. Bored Ape Yacht Club launched in April 2021, selling out at 0.08 ETH per ape (approximately $190 at launch). Celebrity adoption followed: Paris Hilton, Jimmy Fallon, Eminem, Gwyneth Paltrow, and hundreds of others purchased BAYC NFTs as public identity signals.

The Institutional Phase (August 2021-January 2022): The PFP template was replicated by thousands of imitators. Most had no meaningful artistic distinction from their predecessors; many were outright derivative. But the speculative environment rewarded minting speed over quality — collections sold out at launch regardless of merit. Trading volumes peaked in January 2022, with OpenSea processing over $5 billion in monthly volume.

The Collapse Phase (February 2022 onward): The NFT market began declining in synchrony with the broader crypto market, accelerated by the Luna/Terra collapse (May 2022), Celsius Network and Three Arrows Capital insolvency (June-July 2022), and the FTX collapse (November 2022). By December 2022, monthly NFT trading volume had fallen below $300 million — a 94% decline from peak.

What Survived: The Selection Mechanism

The NFT crash was a brutal but efficient sorting mechanism. Projects with genuine value propositions — artistic merit, technical uniqueness, community depth, or first-mover historical significance — retained holders and secondary market activity. Projects whose value derived entirely from speculation collapsed to zero or near-zero.

Blue-Chip Generative Art: Art Blocks

Art Blocks is the most significant surviving NFT art platform and the clearest example of what the market selected for. Founded by Snowfro (Erick Caldwell), Art Blocks deploys artists’ generative algorithms to Ethereum mainnet, where buyers mint unique outputs — no two outputs from the same algorithm are identical, and the algorithm is stored on-chain permanently. The artwork is produced by code at the moment of mint, derived from the transaction hash as a random seed.

The Art Blocks Curated collection — the platform’s highest-curation tier — hosts the definitive works of generative art NFTs:

Chromie Squiggles (by Snowfro): Project #0 on Art Blocks, now one of the most recognisable and liquid NFT collections. Simple coloured squiggles on black backgrounds, algorithmically generated at mint. Chromie Squiggles achieved their iconic status through first-mover significance, the identity of the platform’s founder as artist, and a genuine aesthetic simplicity that has proven durable. Floor prices, while far below 2022 peaks, have maintained value that most PFP collections cannot claim.

Fidenza (by Tyler Hobbs): Hobbs’ algorithmic art piece using flow field algorithms to generate rich, flowing compositions. Fidenzas became one of the most sought-after Art Blocks works, with rare outputs selling for prices exceeding 1,000 ETH at peak. The on-chain nature of Fidenza — the algorithm runs on Ethereum indefinitely, independent of any external storage — underpins its archival permanence.

Ringers (by Dmitri Cherniak): String-winding algorithms generating compositions where a string is wound around pegs, creating mathematical arrangements of varied visual richness. Ringers are among the most technically interesting Art Blocks outputs, with a dedicated collector community focused on mathematical properties rather than visual surface appeal alone.

Art Blocks Curated survived the crash because the value proposition was genuine: unique, algorithmically generated artworks produced by serious artists, stored permanently on-chain, in limited editions that cannot be replicated or extended by the artist after the fact. This is fundamentally different from the 10,000-copy PFP model where value is purely social signalling.

Historical PFPs: CryptoPunks and BAYC

Of the thousands of PFP collections that launched during the bull market, only two have maintained significant secondary market value through the bear and recovery cycles: CryptoPunks and Bored Ape Yacht Club.

CryptoPunks: Launched by Larva Labs in 2017 as a free claim, CryptoPunks are 10,000 pixel art characters with varying rarity attributes. Their status as the original profile picture NFT collection on Ethereum, their historical significance (predating both the ERC-721 standard and the term “NFT”), and their scarcity (the number is fixed and the original contracts are immutable) have made CryptoPunks the most durable PFP collection. Institutional acquisition — including major art museums adding CryptoPunks to collections — reinforced their status. Yuga Labs (of BAYC) acquired the CryptoPunks IP in March 2022, adding legal clarity to IP rights previously managed informally.

Bored Ape Yacht Club: BAYC’s survival reflects both first-mover advantage in the celebrity/social identity PFP space and the substantial community infrastructure Yuga Labs built — the Otherside metaverse, ApeCoin governance, and a series of derivative and complementary collections. BAYC floor prices fell from approximately 100 ETH at peak to 15-25 ETH range in 2025, a significant decline that nonetheless represents meaningful retained value relative to the near-total collapse of second-tier PFP collections.

What Did Not Survive

The casualty list is long and instructive. Almost every copycat PFP collection that launched between June 2021 and April 2022 — regardless of art quality, team claims, or roadmap promises — has near-zero secondary market activity in 2025. Celebrity NFT projects (Pele, Doja Cat, various athlete collections) typically have trading volumes measurable in dollars per month. Metaverse land projects (other than Decentraland and The Sandbox, which themselves declined severely) saw near-total value destruction.

The pattern is consistent: collections where value derived from speculative dynamics — anticipated demand growth, celebrity association, empty roadmap promises — saw value collapse when speculation ended. Collections where value derived from art quality, technical uniqueness, or undeniable historical significance retained holders.

Swiss and Zug Collectors: The Market’s European Avant-Garde

Switzerland’s traditional art market infrastructure — centred on Basel (Art Basel), Zurich’s galleries and auction ecosystem, and a wealthy collector base that includes some of Europe’s most sophisticated art buyers — engaged with NFTs earlier and more substantively than comparable European markets.

The Swiss collector community for digital and NFT art is concentrated among:

Technology-Adjacent Wealth: Switzerland’s wealth management industry, pharma sector, and technology entrepreneurs produced a cohort of buyers comfortable with digital assets and early to the NFT market. Many Swiss crypto-native investors (who had held ETH since 2016-2018) were early NFT buyers, acquiring Art Blocks works and historical PFPs during the formation phase.

Traditional Collectors Entering Digital: Several established Swiss art collectors — whose primary collections focus on modern and contemporary art — began acquiring NFTs as a distinct but complementary category from 2021 onward. These buyers focused on artists with established gallery representation who moved into NFT formats, including Swiss-based digital artists and international artists showing at Art Basel’s digital art sections.

Institutional Engagement: Swiss family offices and wealth managers began addressing NFT holdings in client portfolios by 2022 — primarily for portfolio assessment and wealth tax compliance purposes rather than as active buyers. The question of how to value and report NFT positions became a practical advisory issue that brought Swiss financial professionals into the market.

Swiss Auction Houses and the Physical Market Bridge

Switzerland’s auction ecosystem has engaged with NFTs as a natural extension of its digital art and collectibles infrastructure:

Christie’s Geneva: Christie’s Swiss operations have conducted sales incorporating NFT-adjacent digital art, particularly as part of sales accompanying physical works by artists who work across digital and physical media. The Geneva saleroom has handled consignments from Swiss collectors liquidating NFT positions acquired during the bull market, typically offered alongside physical works as part of themed digital art sales.

Phillips (Zurich): Phillips has been among the more active international auction houses in the NFT space, conducting dedicated digital art sales that include NFTs by established digital artists. Phillips’ Zurich presence connects to a collector base with technical sophistication and appetite for digital formats.

The challenge for traditional auction houses handling NFTs is custody and settlement: unlike physical works, NFT transfer requires blockchain transaction management. Major auction houses have developed internal Web3 capabilities or partnered with specialist blockchain custodians for settlement, but the operational complexity remains higher than physical art transactions.

The Swiss Art Prize, one of Switzerland’s most visible art awards, has incorporated a digital art category that has recognised NFT-based works, providing institutional validation for the format within the Swiss cultural establishment.

Physical-Digital Hybrid NFTs: Luxury Authentication

Switzerland’s dominant position in global luxury goods — watchmaking, jewellery, precision instruments — has created a distinct and durable NFT use case: physical-digital authentication.

Swiss Watch NFT Authentication

The concept addresses a genuine market problem: the secondary luxury watch market is plagued by fakes, damaged provenance documentation, and service history disputes. An NFT issued at manufacture, linked to a watch’s serial number and recording provenance, service history, and ownership transfers, creates an immutable authentication trail that supplements or replaces paper certificates.

TAG Heuer has implemented NFT certificates for selected limited edition watches, with the NFT providing a digital twin of the physical piece and a permanent on-chain provenance record. The NFT transfers with watch ownership, creating a continuous ownership history.

IWC Schaffhausen has explored digital ownership certificates for limited edition pieces, particularly for collector-oriented releases where provenance integrity commands premium value.

Breitling was among the first major Swiss watchmakers to implement digital certificates as NFTs, offering blockchain-backed certificates of authenticity for all new watches sold through authorised channels.

The luxury authentication use case has proven more durable than speculative PFP NFTs because the value proposition is functional: the NFT does something useful (proves authenticity and provenance) rather than serving purely as a speculative asset. FINMA’s classification of provenance authentication NFTs as utility tokens — not securities — provides regulatory clarity that encourages continued development of this application.

Music NFTs and Royal.io

The music NFT space emerged as a distinct category from PFP collecting, with different economics and a distinct collector profile. Platforms like Royal.io enable artists to sell fractional ownership of music royalty streams as NFTs: buyers purchase a percentage of future streaming and synchronisation royalties from a specific track, receiving ongoing revenue from the NFT holding.

This model is economically distinct from speculative PFP collecting: the value is not purely speculative but is backed by an ongoing cash flow stream. Swiss investors with familiarity with structured products and yield-bearing assets have engaged with music royalty NFTs as a yield-generating position, akin to a fractional participation in a publishing rights portfolio.

The legal treatment of music royalty NFTs in Switzerland depends on their specific structure. An NFT representing a genuine participation in future cash flows from intellectual property likely constitutes an asset token under FINMA’s classification — potentially subject to securities regulation if marketed broadly. Swiss buyers of music royalty NFTs on platforms like Royal.io should be aware of this classification risk, though enforcement risk for purchases from established US-domiciled platforms has been limited.

Tax Treatment: Swiss Collectors’ Advantage

Switzerland’s capital gains tax treatment provides a significant structural advantage for private NFT investors compared to most comparable jurisdictions.

Private Investor Capital Gains Exemption: Under Swiss tax law, capital gains realised by private individuals on assets held as private wealth (Privatvermögen) are generally not subject to income tax or capital gains tax, provided the activity does not constitute “professional trading.” This principle extends to NFT disposals: a Swiss private investor who buys and sells NFTs without the characteristics of professional trading — frequent short-term transactions, leverage, systematic methodology, or where NFT income constitutes a significant portion of total income — may realise NFT gains tax-free.

Wealth Tax on Fair Value: Swiss cantonal wealth taxes apply to all assets, including NFTs, based on their fair value at year-end. The practical challenge for NFT-holding Swiss taxpayers is valuation: NFTs that traded on active secondary markets (CryptoPunks, BAYC, Art Blocks Curated) can be valued based on observable floor prices or recent comparable sales. NFTs with no secondary market activity — the majority of collections acquired during the bull market — must be valued, which in practice often means a nominal or cost-basis valuation. Swiss tax practitioners advise clients to document valuation methodology and be prepared to defend reasonable fair value estimates to cantonal tax authorities.

Income Tax for Artists: Swiss-domiciled artists who mint and sell NFTs — a category that includes a small number of internationally recognised digital artists based in Switzerland — are subject to income tax on NFT primary sale proceeds as professional self-employment income. Ongoing royalty payments received through smart contract mechanics are taxable income. The NFT market’s secondary royalty enforcement mechanism (which has weakened as marketplaces competed by eliminating royalty enforcement) is relevant to how Swiss artists structure their NFT sales.

The combination of capital gains tax exemption for private investors and wealth tax on fair value creates a distinctive planning environment for Swiss NFT collectors: unrealised gains are taxed (via wealth tax on holding value), but realised gains are not (for private investors). This reverses the standard tax incentive structure that most investors face, potentially encouraging realisation of gains in declining markets rather than holding to avoid tax events.

Related Coverage

• NFTs in Switzerland: Legal Treatment, FINMA Classification, and the Swiss NFT Market
• Ethereum: The Web3 Foundation and Zug’s Protocol Anchor
• Web3 Regulation in Switzerland: FINMA, the DLT Act, and MiCA Interaction
• Solana Foundation in Zug: High-Performance Blockchain and Switzerland’s Role in the Solana Ecosystem
• Web3: Definition, History, and the Decentralised Internet Vision

Author: Donovan Vanderbilt | The Vanderbilt Portfolio AG, Zurich Published: 25 February 2026