Within months after its launch in April 2021, Bored Ape Yacht Club (BAYC) has become one of the main reasons Wall Street should take the emerging n
Within months after its launch in April 2021, Bored Ape Yacht Club (BAYC) has become one of the main reasons Wall Street should take the emerging nonfungible token (NFT) market seriously, thanks to its recent sales turnover of over $1 billion.
Celebrities ape into BAYC
For the uninitiated, BAYC is a collection of 10,000 cartoons of anthropomorphic apes with stylish clothes and disreputable expressions. Each ape is practically an image file that should be worthless in a sane world. Nonetheless, they have been managing to fetch astonishing sums, sometimes from some of the world’s most renowned celebrities.
For instance, Jimmy Fallon, a popular American TV host, bought the image of a Bored Ape that wore a striped T-shirt and heart-shaped shades for almost $220,000 in November last year. And very recently, Academy Award-winning rapper Eminem paid nearly $462,000 for an ape that somewhat resembled him.
Meanwhile, one of the rarest Bored Apes, which had a gold fur trait, fetched $3.4 million in an online auction held by Sotheby’s in October, breaking the record of another rare ape with laser eyes, which was sold to the Sandbox for $2.9 million a month before.
But what is the selling point?
The BAYC collection fetches its value from NFTs, digital ownership proofs logged on a public blockchain. Think Bitcoin (BTC), but each “coin” is indivisible and unique in some way.
Meanwhile, most NFT projects, including BAYC, settle via the Ethereum blockchain, priced in its native token Ether (ETH).
But rarity is not the only reason people pay millions of dollars for Bored Apes. In addition to owning a unique avatar, people also gain admissions to an exclusive membership club, imposed with tokens. That gives them entry into an inner circle of elites, bringing them status and more profitable 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 a BAYC’s exclusive club member discussed the allure attached to the elite association. The 26-year old angel investor referred to the membership as something that is “very strong for the Wall Street folks.”
“I think there is a new celebrity joining the club every single day.”
Bored Ape collectibles also enable their owners to enter private messaging boards on Discord and gain privileged access to other NFTs.
Bored Ape Yacht Club “floor price”
Bored Ape collectibles also enable their owners to enter private messaging boards on Discord and gain privileged access to other NFTs. And then, there is a certain reselling value attached to these NFTs, as visible in its rising “floor price,” which reflects the lowest bid one may open for the collectibles.
As of Jan.7, the BAYC floor price was 68 ETH, or around $217,800, up 380% from its mid-August low.
Noelle Acheson, head of market insights at Genesis Trading, credited BAYC for being more flexible in collaborations than CryptoPunks, one of the only high-profile NFT collectible series that came before it.
These collaborations include a BAYC-inspired Adidas gear, the signing of a talent agency, a potential Bored Ape music group, and other related assets emerging around the languid ape characters.
“So, the concept of floor prices — which drives institutional investment in NFTs as well as their increasing use as collateral for loans — no longer depends just on how much investors think someone else will pay further down the road,” Acheson explained, adding:
“Floor prices, and an asset’s appreciation potential, now also depends on what else the NFTs can be used for, other than just displaying.”
Luthra agreed, adding that the continuous involvement of celebrities with BAYC would further boost its recognition among retail and institutional investors alike. That may bring more demand for its NFT collection, which, in turn, would push its floor price higher.
The “Meta” factor
Jelmer Rotteveel, the co-founder of NFT collection MoonwalkerFM, attached one more bullish backstop to the BAYC core valuation: the ongoing hype around Meta, rebranded from Facebook to support the social media giant’s metaverse ambitions.
“With the emergence of Meta we will be entering a new way of communication and business,” he 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 one another digitally.
He added:
“I believe that people will be looking more closely at the developments of NFT projects like BAYC, and, just like you saw with cryptocurrency, they will be stepping in one by one.”
Acheson noted that Facebook/Meta has committed to spending approximately $10 billion on metaverse development, citing its CEO Mark Zuckerberg’s statement that they would look into decentralized…
cointelegraph.com