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A tale of two NFTs: Could Bored Ape Yacht Club flip CryptoPunks?

December 18, 2021No Comments

Starting from its modest minting price of 0.08 Ether (ETH)Bored Ape Yacht Club (BAYC) has risen to non-fungible token (NFT) stardom, competing with one of Larva Labs' early CryptoPunk NFT examples.

Given its steady but amplified growth, BAYC has many crypto natives speculating that their collection will eventually "reverse" CryptoPunks, and there are several reasons to back it up.

Considering which collection is NFT's main competitor, the competition between these two collections is driven by several factors. With an existing divide between the adoption of major media and the intellectual property rights granted to their owners, the BAYC and CryptoPunks collection also has a disparate number of unique holders. This is important because the number of unique owners often indicates a wider variety of owners, meaning that you are less at the mercy of a single sale that dictates the total or minimum value of the project.

Let's take a look at some of the factors that NFT advocates and traders are talking about regarding the BAYC project changing the CryptoPunks minimum price.

Two different labs and visions

CryptoPunks' stagnation compared to BAYC's dynamic marketing nature leaves many speculating that a turnaround is inevitable. To add fuel to the fire, although there are many copyright options offered to creators, the "no rights" option is not offered at LarvaLabs.

As such, many have taken to Twitter to comment in support of the speculation. One particular CryptoPunk # 4156, now old, was sold for 2,500 Ether in principle and in dispute regarding Larva Labs' position on Creative Commons 0 (CC0), also known as "no rights reserved."

Beyond the issues with intellectual property (IP) rights, it appears that groups of people are mobilizing around "flippening" because BAYC appears to have dominated their overall marketing and strategic partnerships.

Released on April 20, 2021, the fun but boring-looking apes were minted for 0.08 ETH, valued at $ 300 at the time. Not long after more notable names like NBA star Stephen Curry began switching their Twitter profile photos to Apes, the market began to surge, solidifying the collection as an apparent "blue chip."

Gaining the attention and adoption of mainstream media and celebrities alike, BAYC appears to have a different track record than CryptoPunks. More than individuals, BAYC is strategically partnering with other brands such as Adidas and most recently announced its partnership with Animoca Brands, a Hong Kong-based software company focused on blockchain games for its future play-to-win (P2E) games. ).

By confirming its association with Adidas, BAYC alludes to its potential interoperability - the ability to exchange data across different systems or, in this case, Metaverses.

CryptoPunks was first generated for free on June 23, 2017 for anyone with an Ethereum wallet. The only fee was the price of gasoline to coin. Although CryptoPunks was considered by many to be the first "NFT" at the time, the token itself is not an ERC-721 token. While it is based on the Ethereum blockchain, it turns out that CryptoPunk predates the ERC-721 standard and is closer to being an ERC-20 token.

According to Larva Labs, you no longer have any control over the code. used to buy, sell and trade CryptoPunks through the blockchain. By giving up control, he gave the code more credibility through transparency, assuming it would deliver everything it was promised to do.

If that's what the community anticipated it's a different story.

Creators control intellectual property or bankruptcy

There appears to be a climate change with respect to where the value is placed in an NFT collection. The ongoing dispute within the NFT sphere is who owns the rights: the creator or the owner?

Many are questioning projects that grant limited rights to their owners. However, very few NFT projects align with a CC0 mentality in which "no rights are reserved." The few NFT projects that operate this way are CrypToadz and NounsDAO, a project loved by @ punk4156.

Not satisfied or content with the limited rights granted to CryptoPunks owners, the renowned CryptoPunks Ape Punk # 4156 changed his tune. Despite the long-standing relationship with CryptoPunks, particularly the one behind their Punks "brand" # 4156, they put one of the rarest types in the collection up for sale. His Ape punk up went on sale for 2,500 ETH, valued at $ 10.26 million. As the third highest-value CryptoPunks sold, many have taken to Twitter to comment on this historic sale.

Copyright issues are what kicked out one of the community's top members, and given his reputation, many are turning their sights on the left-wing CryptoPhunks. Phunks supporters claim to align themselves on the "right side of history" as they allegedly grant intellectual property rights to their owners.

Despite the declared and granted rights, there is something to be said about the figures: the figures that the BAYC collection has obtained cannot be denied.

Power in numbers

Over the past 30 days, the BAYC collection has accumulated a trade volume of almost 44 Ether, according to data from OpenSea. Surprisingly, in November alone, BAYC's floor price rose more than 50% and the average price is about 56.5 Ether, suggesting that its bottom could easily approach that of punks.

7-day Bored Ape Yacht Club floor price. Source: OpenSea

Comparatively, the Crypto Punks collection is locked at 32,005 Ether in the last four weeks. Since the sale of Punk # 4156, its minimum price has been steadily declining and is down 7% from last month, according to data from Dune Analytics.

BAYC versus CryptoPunk price performance. Source: Delphi Digital

With so much emphasis on minimum prices, the number of unique brackets in an NFT collection is often overlooked. By putting the laser focus on the amount of liquidity being exchanged, you lose sight of the number of people who have the token.

It could be argued that the greater the number of unique holders, the more indicative the success of the collection. This is because it is widely adopted and less at the mercy of a small group of people who could easily turn on the gas with a single sale.

When comparing the two collections, BAYC has almost 6,000 unique holders, while CryptoPunks has less than half the number of unique holders at 3,273. According to Larva Labs, the top 10 CryptoPunk owners have more than 100 CryptoPunks in their wallets and the top wallet contains 410.

List of top 10 CryptoPunks owners. Source: LarvaLabs

According to Dune Analytics, the highest percentage of apes possessed is 1.05%, which means that no wallet owns more than 105 apes. Since fewer wallets in the BAYC collection occupy a large percentage of ownership, it means that there are more people in the community who not only won the majority of the collection, but share a collective sense of value. Members of the Bored Ape Yacht Club community who will protect the value that the brand appears to capture through their partnerships and are "delivering diamonds."

Percentage of apes owned by the top 50 owners. Source: Dune Analytics

A possible "flippening", but does it matter?

Great emphasis is placed on "when will BAYC switch CryptoPunks?" Perhaps the most important question is, does it matter?

Regardless of whether apes invest punks, many argue that apes would never out-price premium-tier punks like Aliens or the CryptoPunk version of Apes. Some say that the BAYC collection lacks a range of visual โ€œstatus stratification,โ€ which makes it more difficult to assess.

Only time will tell if the apes turn the punks around. However, the narrative could shift and focus less on the market caps and floor prices of both collections and more on the value that both collections capture over time, regardless of copyright limitations.

After all, there is always another potential "blue chip" on the horizon.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and business move involves risk, you should do your own research when making a decision.