Months after its launch in April 2021, Bored Ape Yacht Club (BAYC) has become one of the main reasons why Wall Street should take the emerging market for non-fungible tokens (NFT) seriously, thanks to its recent sales volume of more than a billion dollars. .
Celebrities are introduced to BAYC
For the uninitiated, BAYC is a collection of 10,000 anthropomorphic ape cartoons with fancy clothes and disreputable expressions. Every ape is practically an image file that should be worthless in a sane world. Nonetheless, they have managed to obtain staggering sums, sometimes from some of the most famous celebrities in the world.
For example, Jimmy Fallon, a popular American television host, bought the image of a bored monkey wearing a striped T-shirt and heart-shaped curtains for almost $ 220,000 in November of last year. And very recently, Academy Award-winning rapper Eminem paid nearly $ 462,000 for an ape that looked a bit like him.
Meanwhile, one of the rarer Bored Apes, which had a gold skin trait, sold for $ 3.4 million at an online auction held by Sotheby’s in October, breaking the record for another rare laser-eyed ape, which was sold to Sandbox. for USD 2.9 million a month earlier.
But what is the selling point?
The BAYC collection derives its value from NFT, proof of digital ownership registered on a public blockchain. Think of Bitcoin (BTC), but each “currency” is indivisible and unique in some way.
While, Most of NFT’s projects, including BAYC, are settled through the Ethereum blockchain, priced in its native Ether (ETH) token.
But rarity isn’t the only reason people pay millions of dollars for Bored Apes. In addition to owning a unique avatar, people also get admissions to an exclusive membership club, enforced with tokens. That gives them access to an inner circle of elites, which gives them more profitable status and opportunities.
APE FEST 2021 details posted in the BAYC Discord: https: //t.co/KjYGPhYWCP
☠️⛵️ pic.twitter.com/jvY38qf6NK
– Bored Ape Yacht Club (@BoredApeYC) October 1, 2021
Evan Luthra, the CEO and founder of EL Group International and exclusive member of the BAYC club, spoke about the appeal of the elite association. The 26-year-old angel investor referred to membership as something that is “very strong for the people of Wall Street.”
“I think there is a new celebrity joining the club every day.”
Bored Ape collectibles also allow their owners to enter private messaging forums on Discord and gain privileged access to other NFTs.
Bored Ape Yacht Club “minimum price”
Bored Ape collectibles also allow their owners to enter private messaging forums on Discord and gain privileged access to other NFTs. And then, there is a certain resale value attached to these NFTs, as can be seen from their rising “floor price”, which reflects the lowest offer that can be opened for collectibles.
As of January 7, BAYC’s low price was 68 ETH, or around $ 217,800, 380% higher than its mid-August low.
Noelle Acheson, Director of Market Insights at Genesis Trading, recognized BAYC for being more flexible in collaborations than CryptoPunks, one of the only high-profile NFT collectible series that preceded it.
These collaborations include a BAYC-inspired Adidas team, the signing of a talent agency, a potential music group Bored Ape, and other related assets growing around languid ape characters.
“So the concept of floor prices, which drives institutional investment in NFT, as well as its increasing use as collateral for loans, no longer just depends on how much investors think someone else will pay later.”, Acheson explained, adding:
“The minimum prices and the potential for appreciation of an asset now also depend on what else the NFTs can be used for, besides just showing them.”
Luthra agreed, adding that continued celebrity participation in BAYC would further boost its recognition among retail and institutional investors alike. That can create more demand for your NFT collection, which, in turn, would increase your floor price.
The “Meta” factor
Jelmer Rotteveel, co-founder of the NFT MoonwalkerFM collection, attached one more bullish endorsement to BAYC’s core valuation: the ongoing hype around Meta, renamed from Facebook to support the social media giant’s metaverse ambitions.
“With the emergence of Meta, we will enter a new form of communication and business”, told Cointelegraph, adding that NFTs would become an integral part of the metaverse sector, with users supporting unique digital avatars, such as Bored Apes, to interact with each other digitally.
Added:
“I think people will take a closer look at the developments of NFT projects like BAYC and, as they saw with cryptocurrencies, they will intervene one by one.”
Acheson noted that Facebook / Meta has committed to spending approximately $ 10 billion on metaverse development., citing their CEO Mark Zuckerberg’s statement that they would look to decentralized metaverse apps.
“Believe it or not, investors are likely to think about getting ahead of those flows,” he added.
Will Wall Street become NFT?
As stated, BAYC’s net sales recently crossed the $ 1 billion mark, nearly 10% of what Apple earned in 2021. Meanwhile, the NFT sector, overall, processed sales worth USD 41 billion, which almost equaled global art sales earnings for the year, according to data from Chainalysis.
Matt Hougan, chief investment officer at Bitwise Asset Management, admitted that many of his clients had been seeking exposure in the NFT space without needing to crisscross through its awe-inspiring technology.
In response, Bitwise launched a dedicated fund last month, which tracks its own NFT Bitwise Blue-Chip Collections Index, a basket of the ten largest NFT collections weighted by market capitalization, and buys and maintains artwork from BAYC, CryptoPunks and others. NFT projects.
The “Blue-Chip NFT Index Fund” is available only to institutional investors who invest at least USD 25,000 in the product.
Rebekah Keida, chief marketing officer at New York-based investment management firm XBTO, favored the prospects of including front-line NFT projects like BAYC or CryptoPunks in Wall Street funds.
Keida says it would open the floodgates for accredited investors to see thousands, even millions, of dollars in these digital projects.
“The opportunities provided by increased capital flow enhance the legitimacy of major NFT projects while allowing investors a diverse stake in crypto,” he told Cointelegraph.
Luthra showed confidence in the ability of asset managers to follow Meta’s foray into the metaverse sector, which, in turn, would benefit NFT projects like BAYC, saying:
“If Meta thinks the future is in the metaverse and that is where they are investing their time and energy, it only makes logical sense for asset managers to roll out funds into the industry. As the space matures and more opportunities become available, I am confident that we’ll see a lot more metaverse-related funds pop up to seize the opportunity. “
Meanwhile, Sami Chlagou, CEO of the metaverse game Cross the Age, he compared Meta’s potential involvement in the NFT space to “lighting a lamp on the heads of investors who are far behind on this concept.”
“Whether you think Meta’s decision is good or bad, the fact is that when one of the largest social media groups open to innovation and known for shaking up our environment talks about an issue, it opens doors and the desire to involve”.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Each investment and commercial movement involves a risk, you must do your own research when making a decision.
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