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As NFTs go mainstream, crypto users unearth forgotten projects
After NBA Top Shot and a high-profile digital artwork auction garnered mainstream attention, traditional crypto users have begun to play the role of NFT archeologists — NFT Snapshot
Nonfungible tokens, or NFTs, are on the upswing.
NFTs have now expanded to a wide variety of digital goods — including artwork, sports cards, domain names, in-game items and even tweets. People are beginning to understand their inherent inability to be counterfeited, as well as their scarcity, transparency and portability.
The unprecedented attention that NFTs have received over the past few weeks is related to the $69.3 million sale of a digital art collection. Vignesh Sundaresan, the founder of NFT fund Metapurse, purchased Beeple's "Everydays — The First 5000 Days" during an auction at Christie's, which mainstream media covered in real-time.
It's clear that the influence of nonfungible tokens is growing — and sports stars seem to have taken a strong interest in NFTs. Legendary skateboarder Tony Hawk is joining the NFT craze by tokenizing his "540 ollie" via digital platform Ethernity Chain in the coming weeks. Before this, four-time Super Bowl winner Rob Gronkowski launched an NFT card collection on OpenSea. All 349 cards sold out — with one selling for 230 ETH, or approximately $416,000.
Moreover, OpenSea — an NFT marketplace built on the Ethereum network — collected $23 million this week in a Series A funding round led by a16z. The second-largest marketplace after NBA Top Shot has seen a 100x increase in volume over the past six months. According to Dune Analytics, the platform has attracted more than 80,000 traders and achieved a trading volume of $245 million. In March, alone, OpenSea's volume has already exceeded $100 million.
No one can shake NBA Top Shot
The trading volume of top NFT collections remains highly correlated to cryptocurrency prices. Due to the plunge in BTC and ETH prices last week, the NFT market cooled down a bit. CryptoPunks saw a decrease in volume and transactions, but rare punks are still selling at high prices — such as #3106 being sold five days ago for 240 ETH, or $431,257. This early NFT project only completed 318 transactions in the last week but is maintaining a level of prestige in the cryptocurrency space.
NBA Top Shot continues to see mass adoption. Built on the Flow protocol, the officially licensed platform is no longer dominated by crypto traders after attracting a large user base of basketball fans and sports memorabilia collectors. The number of people trading on this marketplace jumped 38% in the past seven days to over 160,000, far ahead of all other projects. Meanwhile, a Series 1 LeBron James dunk from a game against the Houston Rockets sold for $210,000 on Saturday — setting a new record.
Rarible's volume also bucked the trend in the past seven days with a 30% increase to nearly $9 million. This shows that NFT artwork is gradually becoming more accepted. In the past week, around 7,000 traders completed transactions on Rarible.
MoonCatRescue unearthed by NFT archeologists
MoonCatRescue is by far the most interesting NFT project to have emerged in March — although it lost some heat in the past week after volumes plunged by 75%. MoonCatRescue was developed by Ponderware in 2017 and then abandoned. In terms of contract creation time, it is three months older than CryptoKitties, which launched in late November 2017, and second only to CryptoPunks, which launched in June 2017.
MoonCatRescue was rediscovered by crypto archaeologists on March 12. Twitter user Allen Hena posted a tutorial for rescuing MoonCats at the time, which then triggered a buying frenzy. According to OpenSea, the volume of Wrapped MoonCats traded since March 12 reached 5,800 ETH, with an average price of 1.02 ETH. However, the price floor came to about 0.5 ETH in the last few days.
After the MoonCats frenzy, NFT archeology has become an aspect of the overall marketplace. For example, old collections on Nifty Gateway are being bought out quickly at high prices, regardless of their quality.
NFT projects are gamifying
Over the past week, we can observe that NFT collections are incorporating more gamification. Blind boxes and bonding-curve sales are being used on several projects. For example, Chubbies — which are programmatically generated GIFs — have adopted both mechanisms. 75% of Chubbies are priced under 0.2 ETH, and the highest price is capped at 1 ETH. Under this design, early adopters would have the incentive to spread this collection to more people in order to make their Chubbies appreciate in value.
Moreover, Chubbies are unrevealed during the presale, which makes it full of uncertainty and forces buyers to purchase more blind boxes in the hope of having a higher probability of obtaining a rare piece. This gamification adds to the buying experience by incorporating new and challenging tasks.
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