The retreat of Bybit highlights the mounting difficulties faced by NFT marketplaces amid declining demand and rising security concerns.

X2Y2, once a leading NFT marketplace, will cease operations on April 30, 2025, following a staggering 90% drop in trading volume since its peak.

The NFT market as a whole is facing a severe downturn, with daily trading volumes plummeting from over $18 million to just $5.34 million, marking a 70% decline over the past year.

This closure comes on the heels of a significant security breach at Bybit in February 2025, where hackers stole around $1.4 billion in digital assets, compounding operational challenges.

Bybit's decision to shut down its NFT marketplace and related services is part of a broader strategic pivot to focus on core trading operations and improve risk management.

In light of the declining market, the X2Y2 team plans to pivot towards AI-powered projects, indicating a shift away from the NFT sector.

Following the announcement of its closure, the price of the X2Y2 token dropped significantly, reflecting a 97.7% decrease in value over the past two years.

While prominent collections like Bored Ape Yacht Club have seen reduced trading volumes, some projects such as Pudgy Penguins and Doodles continue to perform well due to strategic partnerships.

At its peak in May 2022, X2Y2 recorded a monthly trading volume of $209 million, but has struggled to maintain relevance amidst fierce competition.

A recent report indicated a 63% year-over-year drop in NFT sales, underscoring the challenges the sector is currently facing.

Despite processing a total of $5.6 billion in transactions since its launch, X2Y2's trading volume dwindled to just $53 million in the last year, ranking it fourth among NFT marketplaces.

Founder TP emphasized that the decision to shut down X2Y2 reflects a necessary shift in focus after three years of operation, as the marketplace grapples with the lessons learned about sustainable value.