Non-Fungible Bored Apes Are Taking Over the World
While majority of crypto’s headlines these days are still somewhat centered around Bitcoin and Ethereum’s price action, NFTs have exploded in a yuuuuge way. What started off as mere JPEGs and simple digital art, is now gearing up to shape the entire Web3 narrative.
Oh and for those who still haven’t heard of the Bored Ape Yacht Club (BAYC), you can check them out . They started out as a series of 10,000 generative pictures on the Ethereum blockchain, where the only utility for members back then was to scribble on a wall in a virtual bathroom stall. They have since grown to something a whole lot bigger, and cheapest ape for sale is now going for a cool 100 ETH (or ~US$330k).
With Facebook officially changing their name to Meta, it’s a clear signal that Zucks also wants to be a part in building this world.
And why not? Just think about how many hours a day you used to spend online, 10 years ago, and how many hours you spend online today. But why would anyone even shell out that much for a JPEG? And what are they actually good for?
Social Currency & Digital Identity
As apes continue to rise in fame and cult status, everyone from Stephen Curry to Mike Shinoda are getting on bored. Even Jimmy Fallon managed to snag one of his own.
You see, nouveau riche millennials might be less inclined to flaunt a Monet to visitors in their own homes, when they can flaunt a digital avatar to everyone 24/7. With millennials spending an increasing amount of time online (IG, Tiktok, Roblox, Fortnite), their digital persona become even more important than their IRL identities. Already used to spending hours preening themselves for their perfect online mug shot, building an online identity around a digital avatar will be a natural extension of this offline-to-online migration.
Social flexing is actually nothing new. With it comes concepts like origins, provenance, culture relevance and involvement, that help to define an epoch in this new Web3 passage. And just like icing your wrist with an AP, icing your online identity (Twitter, IG, Facebook, etc) with a verified avatar will get you instant social recognition (warning: it will also attract scammers like moths to a flame).
Partnerships and Utility
As one of the most recognizable cards on the planet, the Amex Centurion is coveted because it signals status. Amex has been marketing its products for years, positioning itself as the Veblen standard over the rest. Even with eye-watering requirements and fees, Amex is still wildly successful due to a combination of prestige and utility, driven by partnerships and marketing campaigns.
In the same way, Yuga Labs (BAYC founders) are driving member utility through partnerships. Adidas recently announced a collaboration with BAYC, involving digital and physical products. In addition, there are other NFT projects building on top of them to give Bored Ape holders exposure to the broader market.
Below is a broad-based framework that show how various NFT projects interact with each other. Firms and L2 projects which collaborate with or build on top of strong L1 projects add to the overall robustness of the brand equity, ecosystem and increase the size of the pie for everyone.
This can be contrasted with copy-paste projects with little innovation that cannibalize on existing brands. After all, how many spin-off generative profile pic (PFP) projects that tout themselves as the next BAYC/Cryptopunks can there be, before people eventually get sick of them?
Apart from partnerships, there exists a slightly more intangible utility from holding the most exclusive NFTs. Some of them grant member-only access to channels, or entries into Decentralized Autonomous Organizations (DAOs), which is really just a fancy word for an online club. Some of these communities are more sought after than others, especially those that comprise crypto OGs.
Ether rocks, which have token-gated chats made up of the who’s who in the crypto world, have been rumored to give hidden alpha into the latest and hottest projects/narratives. Fret not, there are other much more affordable projects that allow you to inter-mingle with fellow NFT holders and cross ideas too. In a way it is one of the most effective ways to meet like minded people, especially in these strange Covid times.
A Digital Asset Unlike Any Other
Up until recently, Cryptopunk holders didn’t have any IP rights over their punk characters, as the founders Larva Labs did not intend for the holders to retain ownership over their IP. As such token holders could not use their punks for any personal marketing activities.
On the other hand, Yuga Labs granted the IP rights to Bored Ape holders, which helped to further cement their birth in a decentralized Web3 as well as evangelize their overall brand (free marketing anyone?)
Understandably the current IP frameworks might not be well equipped to deal with such an environment. However, a decentralized Web3 model implies value accrual at the user level (read/write/own), where they get to own part of the ecosystem (in this case the IP to their Bored Ape character)
Another example of an L2 project partnership is Jenkins the Valet, where you can license out your Bored Ape and participate in a profit share from book royalties.
So apart from these collaborations, there are also airdrops given to early adopters. If you had minted a Bored Ape at inception, not only would your NFT have appreciated from 0.08 ETH to ~100 ETH, but you would have also been airdropped the following:
1. Bored Ape Kennel Club (current floor price 7Ξ)
2. Mutant Serum (floor price 34Ξ, MAYC ~23Ξ)
3. $APE tokens (>$100k for each OG Bored Ape holder at $10)
At an overall airdrop value worth >$200k, these dividends are extremely juicy indeed.
Gearing Up for the Metaverse
The metaverse, which was was once a place for nerds only, is now exploding to become an international online community, rife with fun, fame, and financial fortune. You can never be sufficiently bullish enough on this.
The million dollar question remains — how are you positioned to ride this wave?
Originally published at https://enigmafi.io on April 2, 2022.