From CryptoKitties to Axie Infinity and then to CryptoPunk, how long can the NFT craze at sky-high prices last?
It has been reported that this year’s hot NFT has reached a bear market. In the past two months, Meta Universe has relied on the new enthusiasm. However, the rumor is back to the rumor that CryptoPunk, which sold sky-high prices this week, does not care about this, and the transaction price has risen to the sky.
According to Larvalabs’ official website, these Punk avatars currently on sale all have high prices, which cost millions of dollars at every turn, which is shocking. On July 31st, Punk No. 5217 in the figure below was sold at a price of 2250 ETH, which was equivalent to USD 5.47 million.
In addition, Punk, number 2140, also changed hands on the 31st for 1,600 ETH, which is about 3.92 million US dollars. Its buyer is Gary Vaynerchuk, who has participated in leading investment in Uber, Facebook, Twitter and other technology companies.
This is another breakthrough after Beeble’s work was sold for US$69 million. After spending so much money on an avatar, this buyer quickly attracted the attention of the onlookers. Is this a forward-looking investment or an impulse? Stupid?
In response to this question, Vaynerchuk himself said in an interview that he has incredible confidence in this asset.
The self-confidence of buyers and the constant emergence of CryptoPunk’s sky-high price level make people unthinkable: whether this is the unstoppable momentum of the blockchain industry that has been developed to the present, or is it the proliferation of bubbles driven by excessive growth. What exactly is CryptoPunk, where has NFT developed, and where will it go?
What is CryptoPunk, which predates the birth of CryptoKitties?
CryptoPunks is not a new thing that has just appeared recently. It was born as early as 2017, and its release time is even earlier than Ethereum’s most popular NFT project, CryptoKitties.
In 2017, a software company called Larva Labs in New York created a pixel character generator. The program can generate thousands of different characters. The founders John and Matt brought these pixel avatars to the blockchain to let Their uniqueness is verified and allowed to be owned by others, which is CryptoPunks: 10,000 artistic images composed of 24×24, 8-bit irregular pixels.
Among the 10,000 CryptoPunks avatars inspired by the 20th century cryptopunk movement, there are 3840 female avatars, 6,039 male avatars, 9 alien avatars, 24 ape-man avatars, and 88 zombie series avatars, each Each has its own display attributes, ownership, sales status, etc.
Its founders Matt Hall and John Watkinson once stated that the creation of these works is just to express a kind of “punk spirit”. When they first released, they left 1,000 CryptoPunks for themselves, and all the others were distributed to Ethereum for free. Users, all CryptoPunk will be claimed in about a week.
With the rise of the NFT boom in the past two years, CryptoPunks has been driven out again. In May of this year, 9 CryptoPunks NFTs provided by Larva Labs appeared in Christie’s auction. After this incident, a large number of new NFTs even began to imitate CryptoPunks.
According to Cryptoslam, in the past week, the trading volume of CryptoPunk is second only to the hottest blockchain game Axie Infinity, making it the second largest NFT project in the current market.
Kevin Rose, a partner of True Ventures, tweeted that in the next ten years, CryptoPunk will surpass the performance of the S&P 500 and claimed to be responsible for his words and deeds.
Of course, CryptoPunks is not the only one of Larva Labs. Later, they also launched the Autoglyphs series of NFTs that pay tribute to the generated art of the 1960s, and Meebits, which is called an upgraded version of CryptoPunks.
The emergence of these new things has continuously injected new blood into the NFT ecosystem.
NFT ecology is gradually prospering
Comprehensive trading platform, infrastructure, collectibles, games
Looking back at the development of the NFT ecosystem, from 2017 to 2018, CryptoKitties accounted for the vast majority of NFT transactions. NFT is mainly games. Later, the NFT ecosystem has seen large-scale growth.
According to NFT Labs statistics, from 2018 to 2020, the size of the NFT market has increased by 825%, and the number of active addresses has increased by 201%. The development trend is significant and the initial ecological scale has been formed.
But in 2021, even if NBA Top Shots, Nifty Gateway and other projects are not included, the NFT market transaction volume in the first quarter has exceeded 8 times the full year of 2020, and the growth rate is staggering.
Since the beginning of this year, after Axie Infinity, CryptoPunks has taken NFT a big step forward. The development of NFT, traditional art finance, entertainment media, etc., has gradually gained more application scenarios, and ecological development has continued to expand.
The current NFT ecology is mainly divided into trading platforms, infrastructure, games and art collections. In the NFT out-of-circle market, collectibles and artworks occupy most of the positions, while NFT categories such as games, sports, and music are also slowly emerging.
Comprehensive trading platform
OpenSea, the leader of the NFT trading platform, was established in 2018. It is currently the world’s largest market for encrypted digital collections. There are a large number of commodities, including various types. In March of this year, OpenSea raised $23 million in funds.
In just two days last week, sales of 95 million U.S. dollars were created. Compared with the market’s annual sales of 21 million U.S. dollars in 2020, it directly shows the popularity of NFT.
In addition, Rarible is also a well-developed comprehensive trading platform that includes almost all types of art, collectibles, virtual reality, games, utility products and sports. According to Crunchbase, the Rarible trading platform has raised $1.8 million in funding.
So far, most of the top 10 NFT projects in terms of sales are built on Ethereum. Therefore, high gas costs and network congestion are still a problem. Therefore, the infrastructure here mainly refers to the NFT public chain and Side chain.
First, the first layer is the Flow developed by Ethereum and Dapper Labs. In addition to the Ethereum used, in order to improve the user experience, Dapper Labs has realized the high scalability of building a blockchain on Layer 1, and created a public chain for games and NFTs-Flow.
According to Flow’s official website, compared with the traditional architecture, Flow’s throughput has been increased by about 50 times without affecting security or decentralization, and transaction fees have also been significantly reduced.
Layer 2 and side chains: WAX, Polygon, Enjin’s public chain Efinity on Polkadot, etc. WAX blockchain is specially designed for NFT transactions. As a global virtual asset trading platform, it is known as one of the behind the rapid rise of the NFT market. It is established by OPSkins (the world’s largest digital market operator). At the beginning, it has a million-level user base.
Games, NFT and DeFi dominate the Polygon ecosystem. Currently, there are popular applications such as Showcase and Terra Virtua. NFT is well-known in the development of Polkadot ecology, and developers can develop NFT applications on the Efinity chain.
Digital Collectibles Platform
The main function is to issue and collect NFTs. These Tokens can be used for games or interactions between players. The CryptoPunks mentioned above are one of them, bringing NFTs into the mainstream.
In addition, there is NBA Top Shots, the leading NFT project on the Flow platform. It is the first blockchain- based NBA digital collectible game . It was launched by the NBA and the founding team of CryptoKitties, Dapper Labs, and received investment from many stars. Support, and become one of the hottest NFT products on the market in one fell swoop.
The most popular game in the NFT field recently is undoubtedly Axie Infinity. Its revenue has crushed Uniswap in the circle, and the outside world has killed the king of glory. Since June this year, Axie Infinity’s active users have continued to grow, and its Token AXS has also repeatedly set new highs. .
In addition, The Sandbox game virtual world sold 3 million US dollars of LANDS NFT, more than 2019 and 2020 combined. Other famous NFT games include Gods Unchained, Guild of Guardians, Splinterlands, etc.
Not only that, but the ecology of NFT in finance, domain name, tracking analysis, audio and virtual games is gradually being established. As an emerging niche encryption field, although the current market value is still small, more and more celebrities, painters, football stars, singers, collectors, and artists are participating in investing in this NFT product, and the entire ecosystem is richer and more prosperous.
Celebrities participate in the layout of large factories
The much-watched NFT faces new dilemmas
With the gradual improvement of the NFT ecosystem, in the past two years, in addition to the participation of artists and collectors in investing in NFTs, large companies such as Ali, Twitter, and Coca-Cola have also deployed NFTs.
According to Google Trends, the global search volume of the keyword “NFT” will increase sharply in 2021, and the attention of NFT is rising.
With its uniqueness and scarcity characteristics, NFT has realized the problem of connecting virtual world assets and real assets. In the future, there may be more physical objects on the chain, and the entire ecology will become more abundant.
However, the unusually high market hype makes it easy for ordinary people to lose sight of its true value and current progress, and it becomes extremely important to look at existing problems and future trends wisely.
First of all, in terms of infrastructure, since most of the current NFT applications are still developed with Ethereum as the bottom layer, the GAS fee on the Ethereum chain is too high, network congestion and other issues are still important issues affecting the stable development of the NFT ecosystem. Although the current NFT ecosystem has begun to seek layer 2 or side chain solutions, it is still being explored.
Secondly, NFT still belongs to the niche circle, and the market has insufficient asset type diversity, so liquidity is limited. Many buyers have purchased assets but cannot sell them. The future value is still very uncertain.
In addition, the digital asset confirmation scheme is not perfect. In terms of digital assets on the chain, there is no endorsement by a centralized credit institution, how to ensure that the ownership of assets is unique and certain, and how to solve the problems of counterfeiting and repeated sales. For the time being, there is no complete closed-loop solution.
At present, the price of a single NFT is often exaggerated, and participants do not have absolute confidence in the NFT. For example, in an interview with Fox News, Beeple said that this is definitely a bubble.
Former Christie’s auction house Charles Allsopp also said that the concept of buying NFTs is “unreasonable” and the idea of buying things that don’t exist is strange.
The emergence of new things is always accompanied by the same opportunities and risks. In the violent development momentum of NFT, how many consumers will be willing to spend so much money to buy a virtual luxury item? Is NFT a “short-lived” The proportion of bubbles and value may be an issue that needs to be examined at all times.
However, for ordinary people, NFT is still in its early stage despite its global popularity. In a market with a sense of atmosphere, the new gameplay and new rules that NFT continues to bring will not be submerged in the next blockchain tuyere. We will wait and see.
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/from-cryptokitties-to-axie-infinity-and-then-to-cryptopunk-how-long-can-the-nft-craze-at-sky-high-prices-last/
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