Lotte Home Shopping is set to discontinue its NFT Shop service, a pioneering venture into the NFT trading space that launched in May 2022 within its mobile shopping application.

The platform aimed to integrate NFTs into its broader strategy of developing a virtual world or ‘Metaverse’ platform. However, facing declining market conditions, the company has decided to cease operations from July 2, effectively exiting the NFT business altogether.

Initially, NFT Shop focused on promoting accessibility and convenience by transacting in the local currency, won.

It introduced several exclusive NFTs, including the popular Belly Bear character and collaborations with prominent creators like ‘More King’ and franchises such as ‘Witch 2’.

The platform also planned secondary sales on Opensea, the world’s largest NFT marketplace.

Following the closure, Lotte Home Shopping’s remaining NFT assets, including Belly Bear NFT, will be managed by Lotte Group’s Daehong Planning division.

An official from Lotte Home Shopping clarified, “We are streamlining our NFT business operations, with Daehong Planning taking over as the hub for ongoing NFT projects.”

The decision to exit the NFT market reflects broader challenges within the industry, exacerbated by the COVID-19 pandemic’s impact on consumer behavior and trading volumes.

While NFTs initially gained traction as digital collectibles and assets, recent data from Dune Analytics shows a drastic decline in trading volumes, with transactions on major platforms plummeting from $3.6 billion in February 2022 to $41 million recently.

Lotte Home Shopping’s move follows similar exits by other major distributors, such as Hyundai Department Store terminating its H.NFT service and Shinsegae reducing benefits associated with its ‘Pubila’ NFT.

An industry insider noted, “Many distributors rushed into the NFT market seeking new revenue streams, but as market conditions have soured, there’s a strategic pivot back to core business strengths.”