Mar 16
Weekly NFT Report-“Ape” together strong
2022–03–16
Summary
One of our favourite trading GOATs is Stanley Druckenmiller, and one quote that struck a lasting impact on our market framework is “earnings don’t move the overall market; it’s the Federal Reserve Board… focus on the central banks, and focus on the movement of liquidity… It’s liquidity that moves markets”. Liquidity narrative has been driving markets for most of 2022, and we will most likely see US raising rates for the first time in [] years tonight. In Congressional testimony 2 weeks ago, Powell indicated he planned to support 25bp hike, making this a highly likely/expected policy outcome. The risk, we believe, is skewed towards being more hawkish, as he might open door for potential 50bp hike in futures FOMC meetings + likely balance sheet reduction discussion + likely revision of inflation forecast to the upside. On broader market front, derisking continues; tech-focused Nasdaq100 entered its first bear market since the pandemic + commodities remain in full discovery mode, exhibiting strong volatility + UST also showing good deal of volatility
On the crypto front, bitcoin (+3%) and ether (+4%) prices have been rather rangebound, but it’s worth noting that bitcoin dominance and volume dominance have climbed over the past month as traders rotate out of altcoins. Most notable headline in the last 3 days was EU’s Markets in Crypto Assets regulation (aka ‘MiCA”) being passed by the European Parliament without proof-of-work (PoW) ban.
Tangential to Druckenmiller’s quote, Hsaka twitted “The base layer could deviate from its cannibalistic ecosystem only for so long”, referring to the Solana ecosystem and how the predatory tokenomics of ecosystem projects has burned users and retail. We are inclined to think that tokenomics would continue to play a more important role in this bear market.
- Outperformers in the Top 100 are: LUNA (+17%), EGLD (+9%), GRT (+19%), XIDO (+20%), BAT (+9%)
- Underperformers in the Top 100 are: OMI (-6%), ZEC (-8%), HEART (-10%)
In the NFT space, OpenSea volume (Chart 1,2) and transaction count (Chart 3) continue to be limp and making new lows for the year. However, from purely narrative perspective, sentiment isn’t quite as negative as it was last week, with NFT prices interestingly being on upward trajectory (Chart 4,5,6). Blue-chip NFTs especially saw good rally in floor prices — biggest recipient being Meebits (+53%) with the news that Yuga Labs acquired IP rights of Meebits and CryptoPunks from Larva Labs (more on it below).
Next up: deep dive
NFT Marketplaces Update
— According to Nansen, here are the NFT Trends so far:
- YTD volume: 3.2M ETH (~$[]bn)
- YTD wallets: 1.11M
- 30-Day volume: 998k ETH (~$[]bn)
- There’s been more buyers than sellers last week (241k vs. 106k)
- Number of first time buyers has been steadily decreasing, but so is the number of returning buyers
— LooksRare continues to print around similar levels of trading volume to OpenSea, albeit with higher volatility.
Yuga Labs buys IP and commercial rights of CryptoPunks & Meebits from Larva Labs, and acquires 400 punks and 1,700 Meebits
— What’s the issue here: Creative commons (“CC0”) vs non-CC0s.
- Licensing regime to existing CP and Meebits holders was non-commercialy only, with T&C explicitly stating that when a buyer purchases an NFT, s/he only owns the NFT, and not any associated art, thus preventing the holder from commercially benefitting from the ownership
- This is in stark comparison to creative commons model by Yuga Labs, where individual BAYC owners own worldwide commercial license associated with their BAYC.
- However, it’s also worth noting that Yuga Labs recently faced backlash for KYC restrictions — Yuga Labs teased new collaboration with Animoca Brands with no details about the project, but users had to sign up via KYC verification — rather blasphemous in our opinion…
- Another notable headline covered by The Block was Yuga Labs planning to build gaming-focused metaverse named MetaRPG that will involve land sales and APEcoin.
— Potential implications
- BAYC: Integrating Cryptopunks and Meebits into the Apeverse?!
- M&A in the NFT space: what would it look like? Buyout of team/company equity? IP right acquisition? Direct NFT purchases? Will we see traditional brands FOMO in and acquire Web3 / NFT brands?
- Corporate valuation: how do you value IP rights and NFTs?
Kaiju Kingz announced expansion of their P2E ecosystem
— What’s the expansion: Genesis, Baby and Mutant Kaijus will all produce $SCALES (different amounts with different qualifications), and the $SCALES can be used to create DNA to infuse into Baby Kaijus or redeemed for an Alpha Pass, a tradable NFT that grants access to Kaiju alpha channels. Scientists will attempt to steal the $SCALES. The launch date for the P2E mechanics and Scientists have yet to be announced. Full details can be found in their Medium post.
Following: New Launches
Generative Nature Synthetic Species (GNSS)
— What’s the collection: the collection comes from MGXS, resident mad scientist at RTFKT, a popularized project following []; the project was also supported by RTFKT developers in smart contract developments. The initial mint distributed “seeds,” the equivalent of mint vials. Starting on Sunday the 13th, holders will have one month to redeem their seeds for a GNSS.
— Details: 0.84e floor | 10,000 supply | 0.33e mint | minted on 3/11/2022
Quantum Key
— What’s the collection: Quantum Key gives holders access to mints, events, and an exclusive collectors lounge at Quantum Space LA, which is planned to open in June. Quantum Art, founded Jonas Lamis and famed NFT photographer Justin Aversano, is a platform for photographers in Web3 to collaborate and release works. The Quantum Key gives holders access to more from Quantum, including whitelist and airdrop opportunities. Quantum is another collection leading the charge to fuse real world utility with digital tokens.
— Details: 2.4e floor | 1,000 supply | 1e mint | minted 3/9/2022
Following: Big Money Raises, and Entrants
Spartan launches $200m metaverse fund
— What’s the fund about: the fund will focus on projects building in the metaverse, specifically virtual worlds that support ‘digital ownership’. The fund will focus on 3 different layers of the metaverse: the infrastructure layer, the experience layer, and the ‘value add layer’, e.g. guilds and NFT marketplaces
— d Gamestop, as well as crypto platforms, such as OpenSea
SoftBank enters NFT marketplace
— What’s the plan: the Bloomberg article detailed Line unit’s plan to launch an NFT marketplace in 180 countries
Sketcher Enters Metaverse
— What are they doing: opening experiential store in Decentraland’s Fashion district
RedBull, LeBron James, E11EVEN Miami all plan NFT products
Tomorrowland signs partnership with FTX Europe to make NFTs
Other things we are reading (or had no time to read)
· On building a brand in the NFT space
Reference Statistics
Price Charts
