The non-homogeneous value capture philosophy of cryptopunk “imitation disks”

As of August 15, the top five NFTs with transaction prices in the 30-day period were all from CryptoPunks. After the upgrade Ethernet Square, London, ETH burning up within 24 hours, addresses and encryption punk What is the relationship? Is there a way to break through the “imitation disk” itself? This article will try to explain the concept of “cryptopunk” to readers and answer the above questions.

Imitation disk “out of the circle” for the first time

At 20:33 (UTC+8) on August 5th, Ethereum completed the London upgrade at block height of 12,965,000, and the EIP-1559 proposal also came into effect. This means that the Ethereum network starts to dynamically adjust the basic cost of each transaction according to the transaction demand and block size, and this part of the cost will be directly destroyed. The ranking of the number of destroyed within a certain period of time also reflects it to a certain extent. Relative activity in the Ethereum ecosystem.

As shown in the figure below, as of the 11 hours after the completion of the Ethereum London upgrade, more than 2899 Ethereum has been burned (59,632 Ethereum has been burned as of 15:00 on August 18), of which the address with the most Ethereum (0xE4CfAE3Aa41115Cb94cFF39Bb5dBaE8BD0Ea9d41) ) At that time, it had not yet been marked, and it was verified that the address was the address of a copy of CryptoPunks-COVIDPunks, which attracted great attention from the market. On the Ethereum Burning Dashboard, it briefly joined the top Ethereum applications such as OpenSea , Uniswap, Axie Infinity and other stablecoins , which to some extent means that it may emerge from the niche circle of NFT encrypted avatars. In front of a wider encryption circle.

The non-homogeneous value capture philosophy of cryptopunk ``imitation disks''

What is the imitation disk?

COVIDPunks is inspired by the original cyberpunk art project CryptoPunks. In 2017, CryptoPunks was launched by Larva Labs, whose founders were John Watkinson and Matt Hall. At first, John made a “pixel character generator”, which was originally intended to be used in games, but it was denied that it was not feasible. They later learned about Ethereum and brought this to the blockchain field, so CryptoPunks was born. They called it an experiment, because the technology at that time and people’s acceptance of virtual collectibles all affected this The uncertainty factor of whether the experiment can be sustained. However, as the oldest encrypted avatar NFT project in history, several factors have promoted CryptoPunks to become a “successful experiment”:

  • Community consensus, has been operating for 5 years since 2017, has a strong community, and is used by industry kol as the personal avatar of Twitter and Discord;
  • First-mover advantage, as the first digital artwork on Ethereum with a built-in method to verify ownership, CryptoPunks can capture more value than other encrypted collections;
  • Capital favors. In addition to NFT believers who use CryptoPunks as the basic asset of the currency standard, new capital such as 3AC and other institutions will also give priority to NFT assets with large capital carrying capacity.

It is difficult for the imitation disk represented by COVIDPunks to obtain the three advantages mentioned above in the short term, but from the characteristics of the project itself, it is based on the imagination of the CryptoPunks project to make some element changes or additions and narrative aspects. In terms of valuation, the highest acceptance rate in the market is also highly consistent with CryptoPunks, and the distribution characteristics of rarity are basically the same.

Generally speaking, the valuation of CryptoPunks usually consists of two parts:

  • One part is the objective rarity of its NFT itself, including the type of CryptoPunk, the number of attributes, and the uniqueness of the attributes;
  • The other part is based on the bidder’s subjective aesthetics based on objective attributes.

The non-homogeneous value capture philosophy of cryptopunk ``imitation disks''

Take the NFT with the highest historical transaction price of CryptoPunks as an example. From the perspective of objective rarity, its type belongs to the 9/10000 alien type, which in itself reflects their absolute rarity, plus the unique attributes favored by the highest bidder. For example, eyes and pipes constitute the general public’s impression of the most highly valued NFT of the cryptopunk type. Therefore, on the NFT with the highest transaction price in the history of imitation, we can see the characteristics of more homogenization:

  • All aliens;
  • “Crystal” or black eyes;
  • A straight mouth and a huge pipe.

But at the same time, the imitation plate has also made some “micro-innovation” adjustments. It can be seen that the highest price of COVIDPunk #2338 is based on CryptoPunk #7804 with its most significant mask element; and the highest price of Fast Food Punk # 001 replaces the headband element of CryptoPunk #3100 with a McDonald’s hat.

From a narrative point of view, COVIDPunks added the characteristics of the times and incorporated the elements of masks, symbolizing that the new crown may last forever with humans or commemorate the fight against the epidemic. At the same time, COVIDPunks, as a narrative Reflexive Asset, inherits the characteristics of CryptoPunks that are prone to volatility, because the narrative is often capricious.

Imitation of a hundred flowers blooming “back-feeding” the ecology

The emergence of crypto-punk “imitated disks” is equivalent to lowering the floor price of the entire crypto-punk NFT ecosystem, greatly reducing the entry threshold of NFT, and it is very beneficial to larger groups.

The non-homogeneous value capture philosophy of cryptopunk ``imitation disks''

As can be seen from the above figure, the issue price of each imitation disk latecomer is inevitably lower than the previous relatively homogeneous disk. From another perspective, the crypto-punk imitation disk with a certain degree of popularity (OpenSea top 150 NFTs) constitute the entire ecosystem, and its average transaction price has been maintained at a relatively smooth low level range. Relatively speaking, the floor price of the entire imitation disk ecology is actually maintained at a relatively smooth low range, which greatly reduces the threshold of the punk ecology, which brings more audiences to the entire encrypted punk ecology and even the encrypted avatar circle. Of course, some of these users will settle down, while other users will also float up to the original “genuine” plate to feed back the ecology.

The economic cycle and impact of imitations are similar to Memes such as Dogecoin and SHIB in the first half of this year. Dogecoin has brought many people who didn’t know how to buy Bitcoin and Ethereum into the circle this year. Some of these people have sunk into Dogecoin’s many imitations or contracts that can be leveraged. Some groups of users have passed The positive feedback process of making money has a more in-depth understanding of the cryptocurrency ecology, and thus allocates a part of the anti-risk assets of Bitcoin and Ethereum, which is equivalent to feeding back the ecology.

The non-homogeneous value capture philosophy of cryptopunk ``imitation disks''

As can be seen from the above figure, the transaction volume of cryptopunk and its imitation disks reflects a certain periodicity and transitivity, from the longest-lived CryptoPunks to the shortest-lived imitation disks. Secondly, the longer-lived punk projects are in The more likely it is that a new imitation disk will erupt for a second time when it is born. CryptoPunks, Fast Food Punks and COVIDPunks are all ignited at the same time when the first three projects with the shortest duration broke out. From the perspective of transaction volume, it is more likely. It is a feedback to the ecology of the newly introduced flow and population of the imitation disk.

The non-homogeneous value capture philosophy of cryptopunk ``imitation disks''

As of August 15th, judging from the NFT transaction price within 30 days, the top five NFT transaction price rankings were all included in the arms of CryptoPunks, and the medium and long board of cryptopunk continued to extend. From the perspective of the floor price, during the half-month of its imitation disk “Hundred Flowers”, its floor price has risen from 21.9 ETH to 44 ETH. Whether it is the focus of attention caused by the imitation disk or the favor of top capital such as 3AC, the entire ecology is Tend to be a positive development.

For niche long-tailed circles, it is a good thing to have a large population. The new population will bring new attention, traffic, and funds. Both good traffic and bad traffic are beneficial to the circle. The problem with imitation is that the liquidity is not good. What everyone criticizes is that it can’t condense the value. This market will naturally give the answer.

Interview view

A whaling ship

When paying attention to the investment opportunities of Cryptopunk, Little Penguin and other NFT collections, pay more attention to the two indicators of highest transaction price and floor price.

The highest transaction price is a long board, which plays a role in capturing market attention and attracting new players to enter the series. The floor price is a shortcoming, which serves as the lowest entry threshold and supports the overall market value. Similar to the currency price when speculating coins, the rise and fall of floor prices are the key to short-term speculation.

Big orange

CryptoPunks is a kind of community culture. It attracted a wave of overseas big Vs in the early stage, and quickly Fomo in big Vs. He has broken away from the traditional NFT thinking that must have IP to fire. I think it will continue to be popular for a long time. , Because the community support is too strong.

COVIDPunks once occupied the first place in the burning of Ethereum, and the head mine is extremely hot, but the product is simply Fork the former, and also under the banner of helping the Indian epidemic, but from their donation data, it can be said that there is no sincerity. The community is in the head mine. After the heat, I also chose to vote with my feet.

William Chen

Imitation disks are not easy to “add V” to Opensea, so the value is often difficult to compare with other original projects. But as a beginner and retail experience, imitation disk is a good transition to draw the distance between people and expensive genuine NFT projects.

In addition, the core value of imitation is to pay attention to Twitter popularity and Opensea trading volume. If you want to experience and participate in the hype, you must pay attention to these two indicators.

NFT Labs

At this stage, the NFT market is not standardized, there are speculative projects, and a large number of imitations of projects such as CryptoPunk and BAYC. For example, after the success of BAYC’s community operation, it was copied by many projects. A large number of imitation disks will accelerate the NFT bubble. After this bubble bursts, NFT can usher in new development. The challenge of NFT valuation is that it includes functional value (practicality + ownership history + digital scarcity + supply and demand relationship + future value + liquidity premium) and enjoyment value.

in conclusion

  • Imitation disks can only imitate the watch, it is difficult to imitate its essence, and there is an economic cycle and impact similar to Dogecoin;
  • The liquidity of the imitation plate is not good, but its appearance has consolidated and enhanced the value of the original plate time and time again, and has the effect of feeding back the ecology;
  • It doesn’t matter whether the imitation disk itself has a way to break through. For the niche long-tail circle, it is a good thing to have a large population base.


Posted by:CoinYuppie,Reprinted with attribution to:
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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