CryptoKitties (a game that allowed people to breed and trade digital kittens) and CryptoPunks in 2017 were the first couples of projects that carved Non-Fungible Tokens (NFTs) into the minds of Crypto enthusiasts for the first time. NFTs then saw a gradual growth over the last couple of years, but the niche exploded in 2021. For context, in 2020 the market was estimated to be around $250 million over the entire year. But in February 2021 alone, there had already been over $360 million worth of NFTs traded. 

That growth has been on a steady trajectory since the turn of the year but started rising after Q2, 2021. NFTs have become such a huge buzz that no one can deny how much of an impact they’ve created within the Crypto space. The NFT “bull run” started when digital artist Mike Winkelmann known as Beeple, sold his NFT (“Every day — The First 5000 Days”), a collage of all the images that the artist has been posting online since 2007. The NFT was sold during an online auction at Christie’s for $69.3 million.

This one sale was like the catalyst to showing people the massive opportunity that lies in NFTs, and it opened the floodgates to both artists and collectors wanting to do business with each other. The first-ever tweet of Twitter CEO and co-founder Jack Dorsey, sold for $2.9 million. Canadian singer-songwriter Grimes sold around $6 million of digital artworks, which included a 50-second video NFT with a price tag of $400,000. The Auction house Christie also sold an NFT of 9 virtual rare CryptoPunks for a record amount of $16.9 million. And then there is the one that involved the NBA. NBA’s Top Shot where NFTs of NBA highlight videos were sold, generated more than $230 million.

NFT Marketplaces like OpenSea, Super Rare, Makers Place and Nifty Gateway have seen tremendous growth as a result of this. Take OpenSea for example. In the last 30 days, OpenSea has seen its user base grow by 229% to 216,314 unique wallet addresses. There’s been a 198% increase in transactions as over 2.35 million transactions have been carried out on the platform in the last 30 days. The total trading volume has reached 1,074,532.33 ETH, which is about $4.23 billion — if you prefer to calculate transactions in fiat currencies.

Even though it is a big one, these are just the numbers for one NFT Marketplace and other Marketplaces are crushing it as well. During this period, the particular kind of NFT that collectors seem to be spending more on have been the Ape based NFTs. The most popular of which has been the Bored Ape Yacht Club (BAYC). On April 30th, Bored Apes officially launched, and offered 10,000 unique Jpegs of their Apes as NFTs at an initial floor price of about $200 in Ethereum. Within 24 hours, all 10,000 NFTs sold out and the floor price three days later had increased to $1700.

The NFT project has gone on to see a lot of flipping on its apes and about $397 million worth of trading volume since its launch. This has in turn increased the floor price as more rarity and value are placed on some Ape images based on colour, toga or fur. The floor price for BAYC is currently at 39.3 Eth with a total volume traded of 145.9 Eth. Owning a Bored Ape doesn’t just stop there. It also comes with its privileges. Some of these privileges include the additional free NFTs an owner would get from the subsequent Bored Ape Kennel Club and Mutant Ape Yacht Club collections.

Owners also get access to the digital graffiti wall called The Bathroom. The BAYC Bathroom is a canvas that only wallets with at least an Ape have access to. It does the job of a communal digital mural where community members can draw, scrawl, or write expletives, and they can do this every fifteen minutes. 

Sports Stars Aping In

NBA superstar Stephen Curry also joined the frenzy as he bought a $180,000 Ape from the Bored Yacht Club collection. The Golden State Warriors’ two-time MVP was purchased on August 28 for 55 Eth. This information is according to the token’s profile on OpenSea.

The three-time NBA champion announced his purchase of the Bored Ape art by updating his profile photo on Twitter with his new asset: a bored-looking which looked quite rare. Only 1% of the 10,000 apes in the collection is wearing a tweed suit, only 5% is blue-furred, only 3% has got zombie’s eyes and there are only 13% with yellow backgrounds. Curry’s Ape has all of these rare qualities and one can only imagine how much he’d flip it for if he decides to. 

Steph Curry isn’t the only NBA star who’s aped into Bored Apes. Josh Hart of the New Orleans Pelicans is one of the most avid NFT collectors in the league mentioned the possibility of fractionalizing one of his Bored Ape NFTs last month. This means he was willing to allow many investors to own a share of it, potentially benefiting as the NFT rises in value. On August 29th, he tweeted an image from the Mutant Ape Yacht Club, a new collection that was rolled out that weekend.

Another NBA player, Tyrese Haliburton of the Sacramento Kings has also shared images of the NFTs he owns in the Bored Ape Yacht Club while Charlotte Hornets star LaMelo Ball is reportedly a Bored Ape owner too. Although he doesn’t use it as his Twitter profile picture.

Sotheby’s To Auction 202 Bored Ape NFTs 

Auction house Sotheby’s is set to auction about 202 NFTs related to Bored Ape Yacht Club (BAYC) and Bored Ape Kernel Club (BAKC) from September 2 through September 9, marking yet another big non-fungible token (NFT) sale for the art broker. 

The NFTs were developed by Yuga Labs. The owners of the NFTs can offer serums to the apes to generate new apes. It is similar to the breeding process of other blockchain-based games. While the auction will give the Bored Ape project significant public exposure, not everyone is happy with the sale. 

Meltem Demirors of CoinShares voicing his displeasure in a tweet said, “Why are we selling our JPEGs via Sotheby’s and Christie’s who take a 25% cut?”, the tweet continued, “We need to stop looking to old school institutions for validation.”

The worry of the flip 

Flipping in NFTs has become a thing. This is when people quickly sell their NFTs for a marked up price, making profits on their investment and moving on from the project. 

It’s a vicious cycle that has tended to lead a few to dumps, and it has led to a lot of depleted bag holders.

In a lot of these NFT projects’ Discord communities, there is a growing obsession with the floor price (the cheapest price an artwork is going for). “It’s a quick metric to assess the financial health of a given collectible,” Aftab Hossain (aka DC Investor) an NFT enthusiast said. He continued, “But focusing on that fungible value can invite short-term participation.” 

When the focus is on the floor price, it means the community is paying more attention to profit-making. They’re either flipping or waiting patiently to trade out of the project once they double, 5x or 10x their investment. 

Final thoughts 

Seeing how well Bored Ape Yacht Club has done and how a lot of prominent personalities are increasingly thronging to it, it is proving that this isn’t just another hype in the Crypto world. 

NFTs have come to stay and the BAYC has come with it. Of course, we’ll see other Ape projects try to follow in the footsteps of BAYC and they might just be as successful but the point here is, the precedent is there already and it’s looking like a new asset class of its own.