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Nonfungible token projects leading the top NFT use cases
An introduction to the top projects leading the way in NFT collectibles, games, marketplaces, art and domain names
Nonfungible tokens are digital representations of assets that are not interchangeable for another. While they’ve been around since mid-2017, NFTs gained renewed traction among the wider crypto community in 2020 after the DeFi boom. In the first half of the year, the amount of USD transferred in the NFT ecosystem reached $232 million — up 52% from the entirety of 2019.
Continuing that trend, 2021 has seen explosive growth in the NFT sector. NBA Top Shot — a platform for users to purchase or sell officially licensed NBA digital collectibles — brought mainstream attention to NFTs. Sales held by respected real-world auction houses Sotheby’s and Christie’s further validated the relatively new medium. In August 2021, leading NFT marketplace OpenSea became the first to pass $2 billion in monthly trading volume and payment processing giant Visa acquired a CryptoPunk for almost $150,000.
NFTs are often touted for their potential to revolutionize gaming, collectibles, digital art and other sectors. While their utility is still being explored, OKEx Insights examines the top NFT projects, by total sales and volumes, across various categories — including collectibles, virtual worlds, gaming, art and domains. The following NFT protocols are highlighted in this article:
- NBA Top Shot
- Ethereum Name Services
- Bored Ape Yacht Club
- Axie Infinity
- Art Blocks
NBA Top Shot: Making NFTs prime time
NBA Top Shot is an officially licensed blockchain application created in partnership with Dapper Labs and built on the Flow blockchain.
Each collectible in NBA Top Shot — available as an NFT — contains a short video of an in-game moment — such as a dunk, a buzzer-beater or a game-winning block — that includes information about the game the moment came from, the collectible’s rarity, stats of the player it features, seasonal averages and recent sales history.
These moments are sold in a limited number of packs each week, which are categorized in tiers based on their rarity: Common, Rare and Legendary. When the platform comes out of beta, an ultra-rare fourth tier, Ultimate, will be introduced, which will include one-of-one “Genesis” moments and one-of-three “Platinum Ice” moments — though they will be sold via auction rather than through pack drops.
The Common, Rare and Legendary moments can also be purchased from other users directly from the platform’s marketplace — and their prices vary based on their tier, featured players and serial numbers.
NBA Top Shot exploded in popularity, previously topping the total-sales charts in the NFT sector. On Aug. 26, a Legendary LeBron James moment in the “2020 NBA Finals” Series 1 set was purchased for $230,000 — the top acquisition of an NBA Top Shot collectible, to date. The project has also garnered over $680 million in sales, and more than 440,000 fans own the collectibles, as of the time of writing.
Going forward, NBA Top Shot is expected to launch additional features and games.
CryptoPunks: Topping sales charts
CryptoPunks is one of the earliest NFTs and consists of 10,000 uniquely generated characters. Ownership of a CryptoPunk is represented by a nonfungible token on the Ethereum blockchain. Interestingly, they were available for free during the initial release. However, all of them were quickly claimed and are now traded on marketplaces like OpenSea.
The rarity of a CryptoPunk is based on its type, attributes and accessories. For instance, males and females are the most common CryptoPunks, whereas there are only nine alien Punks. Additionally, each CryptoPunk has unique accessories — such as hats, glasses and so on. The value of each Punk is, in part, determined by the number of accessories it has. In general, two or three accessories are the most common, while the rarest Punks have either zero or seven accessories.
The explosive growth in CryptoPunks sales contributed to the skyrocketing NFT market in 2021. CryptoPunks has cemented its position as the foremost NFT project not only because it was the first, but also due to high-profile purchases by the likes of rapper/media executive Jay-Z, NFL star Odell Beckham Junior, crypto investment fund Three Arrows Capital and, most recently, even the payments giant Visa. Additionally, Christie’s bolstered the collection’s reputation by holding in two separate sales on the auction house’s website.
Hashmasks: Unique, collaborative artwork collectibles
Launched by Suum Cuique Labs in Switzerland, Hashmasks offers digital art collectibles created by over 70 artists from around the world. There are a total of 16,384 unique digital portraits on the network — and each is unique in terms of its character, mask, eye color, skin color and items.
The owner of a Hashmask can name their collectible via the platform’s native token — the Name Changing Token. Each holder can claim around 10 NCT generated from their Hashmasks every day, and when they hold 1,830 NCT, they can burn them and rename the Hashmask on the Ethereum blockchain. The provenance record of each Hashmask can be traced via the Interplanetary File System.
Users purchased their first Hashmasks during the initial distribution period that started in late January 2021 and has since concluded. The purchase prices of Hashmasks were set on a bonding curve — i.e., the earlier the purchase, the cheaper the price. Users who participated in the initial distribution also received 3,660 NCTs each, enabling them to make two name changes for their Hashmasks.
One key difference between Hashmasks and other NFT protocols is the gamification aspect — where owners are incentivized to hold their masks and claim tokens, which are then used to name the masks.
There are other dynamics at play too. For instance, 12.5% of all Hashmask characters wear animal masks, while only 5.9% wear pixel masks. The pixel masks may seem more exclusive at first, but a unicorn animal Hashmask is rarer, with only 13 examples in existence.
Since the initial distribution in late January, sales of Hashmasks have reached 34,697 ETH with 4,905 unique owners, at the time of writing. Hashmask #9939 was sold for 420 ETH in January 2021 — a figure still unsurpassed.
Sorare: Ethereum-powered fantasy soccer collectibles
Released in 2019, Sorare is a global fantasy soccer game allowing users to buy, sell and manage a virtual soccer team with digital cards. Each player card in Sorare is a nonfungible token based on the ERC-721 standard.
Since it is powered by blockchain technology, Sorare card owners can verify the scarcity and ownership of their cards, as well as transfer them freely. Each player card displays several attributes, such as rarity, average score and experience points. There are three levels of scarcity in Sorare: Rare, Super Rare and Unique. Each player card has one Unique version, 10 Super Rare copies and 100 Rare copies.
To become a soccer manager in Sorare, users first register their teams and claim 10 common player cards. They can then form a starting squad of five and earn points for players’ performances in actual soccer matches. Users can also compete in various tournaments for ETH rewards.
Sorare has gained widespread popularity after securing official licenses from world-class teams such as Real Madrid, Bayern Munich, Liverpool and Paris Saint-Germain.
The platform raised $50 million in its Series A funding round in February 2021 and partnered with video game giant Ubisoft to introduce One-Shot League for their players in March. It more recently launched an Ethereum scaling solution called Starkware.
CryptoKitties: The first NFTs to go mainstream
CryptoKitties is an Ethereum-based game that allows users to collect and breed virtual cats. The game’s tokens are nonfungible, as each one represents a unique digital cat on the blockchain. These digital cats are differentiated in terms of their appearance and traits — their “cattributes.” Given the nature of the tokens, each digital cat represented by an NFT cannot be replicated, destroyed or taken away.
To start breeding digital cats, users need to deposit ETH in the game’s official wallet from Dapper Labs. There are two ways to breed new kitties: breeding two of your own kitties or breeding with a public sire. Users can get their first kitty by purchasing it in the marketplace or bidding for one in the game’s Offers system.
Experienced CryptoKitties players aim to collect as many valuable digital cats as possible. The value of each kitty is determined by its generation and rarity. For generations, a general rule of thumb is that kitties from earlier generations are more valuable than younger cats. This is because kitties from earlier generations have faster cooldown speeds and can breed more often.
“Gen 0” is the rarest generation of CryptoKitties with a supply fixed at 50,000. This makes Gen 0 kitties scarce, and their value increases over time. Apart from generations, kitties that are also considered rare include those with low ID numbers, as well as Exclusive cats or Founder cats, which tend to fetch higher prices on the kitties marketplace.
CryptoKitties was the first NFT protocol that found popular appeal in late 2017. Since users could breed rare cats and resell new kitties for a profit, the game attracted significant attention. The surging demand for CryptoKitties led to the number of daily transactions on the Ethereum network reaching an all-time high of 1.349 million in January 2018 — a record that was first surpassed in September 2020 amid the DeFi liquidity-mining craze spurred on by Uniswap.
While the CryptoKitties day in the sun has passed, the game retains its iconic status as one of the NFT sector’s pioneers.
Decentraland: A decentralized virtual world
Powered by the Ethereum blockchain, Decentraland is a decentralized virtual world that allows inhabitants to use customized avatars, trade collectibles and participate in the virtual world’s governance process.
To start exploring Decentraland, users must first connect to a web browser with a Web 3.0 wallet. Users can then select and customize their avatar, and each avatar is given a virtual passport representing its identity in Decentraland. Once users have completed the initial setup of their avatar, they can start building their own neighborhood and buy rare digital assets.
Participation in Decentraland requires both fungible and nonfungible tokens. MANA is the digital currency used in the Decentraland marketplace. Each MANA token is interchangeable with another MANA token and is, hence, fungible.
MANA can be purchased from any crypto exchange that lists its trading pairs, such as MANA/BTC or MANA/ETH on OKEx. Users can then spend MANA for parcels or estates of “LAND” tokens, in-game items and even unique names on the marketplace. In addition to the Decentraland marketplace, users can purchase supported items on NFT marketplaces such as OpenSea.
Decentraland also uses LAND, an NFT, to represent ownership of the parcels and estates on which owners can build virtual experiences. LAND is a nonfungible digital asset maintained by an Ethereum smart contract. Each LAND token represents a unique parcel of land and can be traded on NFT marketplaces.
The Decentraland DAO went live in September 2020, encouraging user participation in the virtual world’s governance process. Users can vote on governance proposals, and their voting powers come from three sources:
- Wrapped MANA: MANA converted into WMANA, each of which equals one voting power unit
- LAND parcels: Each parcel equals 2,000 voting power units
- Estates: Each estate equals 2,000 voting power units
Users can cast their votes on various governance topics, including:
- Features and upgrades of LAND and parcels
- Marketplace fees
- Allocation of MANA for development efforts
- Addition of new wearables to the Decentraland world, builder and marketplace
Ethereum Name Service: Leading domain name NFTs
Founded by the Ethereum Foundation in May 2017, Ethereum Name Service is an open, distributed and extensible naming system based on the Ethereum blockchain. The protocol’s users have claimed more than 220,000 registered names to date.
The native TLD — i.e., top-level domain — is “.eth” on ENS. These .eth domain names are unique, nonfungible, represented by ERC-721-compliant NFTs and are available for both purchase and trading on NFT marketplaces.
Since these domain names adhere to the ERC-721 token standard, they can seamlessly plug into NFT markets and wallet interfaces — enhancing NFT and DeFi integrations.
Ethereum Name Service is the leading NFT in its sector, with an all-time trading volume of over 8,500 ETH ($33.5 million at the time of writing) and more than 81,600 owners, according to OpenSea.
Bored Ape Yacht Club: An elite club of ape avatars
Launched in late April, Bored Ape Yacht Club is one of the biggest success stories of the 2021 NFT boom.
Like CryptoPunks, the collection comprises 10,000 character portraits, each possessing different combinations of traits that make some more sought after than others. Departing from the pixelated artwork of CryptoPunks, each of the Bored Apes is illustrated in a comic book style. The project’s pseudonymous creators, Gargamel and Gordon Goner, cite their love of old movies, 90s hip-hop, 80s hardcore punk and classic comics as major influences on BAYC’s aesthetic.
Given the similarities with CryptoPunks, BAYC owners used their NFTs as social media profile pictures almost immediately. However, owning a BAYC NFT is about more than just projecting one’s status online. Holders are granted exclusive perks — such as participation in a treasure hunt and the ability to doodle on a shared online sketch pad, represented as the walls of a clubhouse bathroom.
Following its launch, Bored Ape Yacht Club quickly attracted high-profile attention. Known holders of BAYC NFTs include NBA stars LaMelo Ball and Stephen Curry, rapper KSI, YouTuber Logan Paul and various crypto startup founders. Catalyzing the demand was Christie’s auction house including the collection in a September 2021 sale of NFT avatar projects, alongside CryptoPunks and Meebits.
Such mainstream interest has seen the average price of membership skyrocket. At the time of writing, the cheapest BAYC NFT is just under 25 ETH. The project has racked up more than 93,000 ETH in all-time trading volume on OpenSea. The collection’s most valuable piece to date — a Mohican-sporting golden Ape — sold for 420 ETH, or around $1.4 million, on Aug. 23, 2021.
One of the standout features of the BAYC collection is that holders receive full creative control of their Apes. This has encouraged various spin-off projects, such as a comic book series. Additionally, official spin-off collections — such as the Bored Ape Kennel Club — have become iconic collections in their own right.
Parallel: Sci-fi trading cards at sky-high prices
Parallel is a hugely popular science fiction online trading card game that is currently under development. Despite not being playable today, the project quickly attracted significant attention because of its intricate backstory and stunning visual appeal. Additionally, Parallel was praised for its “fair launch,” which introduced various centralizing features to enable collectors to mint the NFTs without needing to outbid one another with Ethereum gas prices.
The Parallel story takes place in a distant future. With the planet’s energy resources all but depleted, an attempt to generate power using antimatter forced a mass evacuation from Earth. Some ended up on Mars, some on one of Jupiter’s moons, some traveled into deep space and a fourth group remained on Earth.
After thousands of years, each of these so-called “Parallels” evolved along an entirely different evolutionary path. However, in the millennia since most humans departed the Earth, it became abundant in resources. Having detected this, each Parallel set out to return to Earth to harness its energy. Parallel, the game, revolves around the ensuing conflict between these intergalactic civilizations.
As of the time of writing, Parallel has completed two card drops. The first, a presale of non-playable cards, culminated in March 2021. The second drop required buyers to register using an email address and request packs, and with restrictions on the number of packs a buyer could purchase at one time.
Although more centralized than the typical free-for-all mints that result in large Ethereum gas price spikes, the resulting sale ensured that all those wanting to buy could do so, and it was highly praised among NFT enthusiasts. The next drop is scheduled for October 2021.
To date, the highest sale price of any Parallel NFT was on Aug. 21, when a Parallel Masterpiece Alpha Ashes to Ashes card sold for 360 ETH (around $1.12 million at the time of sale). According to CryptoSlam, the collection’s all-time trading volume is more than 29,000 ETH — or more than $88 million at current prices.
Axie Infinity: GameFi’s breakout star
Currently topping CryptoSlam’s rankings with a total sales volume of more than $1.5 billion is the blockchain-based play-to-earn game Axie Infinity. The gameplay revolves around fictitious creatures known as Axies — which players collect, breed and battle. As such, Axie Infinity has many similarities to the hugely successful Pokémon franchise.
Vietnamese video game studio Sky Mavis launched Axie Infinity in 2018. The game has multiple Ethereum-based fungible assets, including governance token Axie Infinity Shards and utility token Smooth Love Potion — both available to buy on OKEx.
The Axies themselves are represented by NFTs, meaning players can trade them on the game’s in-built marketplace. Different Axies possess different traits that make them more or less powerful in battle and, thus, more or less coveted. Through breeding, these traits can be passed on to subsequent generations.
Axie Infinity’s play-to-earn dynamics are partly responsible for the GameFi title’s mainstream appeal. Users in developing nations out of work due to the COVID pandemic started to play the game as an income source in 2021. A short documentary by crypto gaming collective Yield Guild Games and consultancy firm Emfarsis, cited by CNBC, documented several Filipino citizens who had turned the game into a revenue stream. Far from the typical image of a crypto degen at the cutting edge of technology, these gamers were regular folks hit hard by the coronavirus. The coverage attracted others to join the game, and an estimated 1.27 million individuals now own at least one Axie.
Although the most successful GameFi title to date, Axie Infinity is not yet a finished product. Sky Mavis continues to implement updates in accordance with its roadmap. Forthcoming updates will introduce land gameplay, with parcels also represented by NFTs, and an SDK enabling gamers to create their own experiences on plots they own.
Art Blocks: Generative, one-of-a-kind works of art
Art Blocks is a generative art platform that produces unique pieces using scripts created by digital artists. When a collector mints an Art Blocks NFT, the script interacts with that specific transaction’s metadata to produce a work of art that is not only one-of-a-kind but influenced by the collectors themselves.
There are currently three tiers of Art Blocks collections. Curated Projects are collections produced by artists vetted by the Art Blocks team. Meanwhile, Playground features more experimental pieces from the same artists, and Factory is open for non-approved artists to release collections.
Art Blocks was founded by the Texas-based digital artist Snowfro in late 2020. Snowfro was an early collector of CryptoPunks and used sales of the popular NFTs to finance Art Blocks. His vision was to make fine art more accessible and, along with his brother, set out to create a project that used blockchain technology to produce pieces of art that were produced on demand and that no one other than the owner had ever seen before.
The platform’s prototype, a collection by Snowfro called Chromie Squiggle, is one of the best-performing projects under the Art Blocks banner. The highest sale price for one of the pieces is currently 750 ETH. However, the Fidenza collection by Tyler Hobbs contains the highest value Art Blocks to date. On Aug. 23, Fidenza #313 sold for 1,000 ETH — around $3.3 million.
Such high-profile sales have helped Art Blocks accrue an all-time total trading volume of more than 150,200 ETH. At the time of writing, the project is the fourth-best performing NFT collectible project of all time, according to CryptoSlam.
Meebits: Larva Labs moves into three dimensions
Meebits is the latest NFT project by the creative force behind the wildly successful CryptoPunks. The collection features 20,000 computer-generated 3D voxel characters. Like CryptoPunks, each Meebit is unique and features a different combination of attributes and accessories.
In a blog post detailing Meebits, Larva Labs described its latest characters as “the 3D avatar for virtual worlds, games and VR.” As such, each Meebit comes with a 3D model that can eventually serve as its holder’s avatar in metaverse-like online worlds. Unlike CryptoPunks that predate the ERC-721 token standard, Meebits are interoperable with existing services that support Ethereum-based NFTs.
Along with a revamped art style, Larva Labs made changes to its native marketplace for Meebits. In addition to the zero-fee model used for CryptoPunks, the team added a swap function, allowing users to make custom trades between themselves without requiring any money to change hands. Larva Labs claims the aim was to evoke a more youthful spirit of collecting, akin to a child swapping a handful of lower value Pokémon cards for one particularly rare edition in the playground.
The association with Larva Labs made Meebits an instant hit. While the company made no money from the free-to-claim-and-trade CryptoPunks, it generated around $20 million in the first two hours of the Meebits launch in May 2021.
Although not as popular as CryptoPunks, Meebits has amassed a total trading volume of more than 46,100 ETH — around $138.7 million — since its launch. The highest sale price to date for any Meebit was in early August, when #18574, a trucker-cap-wearing alien, sold for 469 ETH, or around $1.2 million at the current ETH price.
NFTs are gaining mainstream adoption in 2021
While 2020 laid a solid foundation for NFTs, 2021 has seen them go mainstream with major sports and digital art partnerships. Basketball and soccer fans saw value in NFTs via NBA Top Shot and Sorare, while Beeple’s record $69.3 million sale of his digital art shook the art scene. We’ve recently seen traditional auction houses like Sotheby’s and Christie’s embrace NFT art and collectibles, as well as increasingly high-profile NFT purchases from professional athletes and international companies.
Although the market surrounding nonfungible tokens might appear to be edging into full-blown bubble territory, such speculation is common around genuinely transformative technologies. Even if the current prices of some of today’s elite projects might not be sustainable, it’s clear that NFTs representing ownership of unique virtual items will be a part of our increasingly digital future.
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