NFT Madness
What’s a Beeple?
This week will go down in history as the week where NFTs brought Ethereum mainstream. When people who don’t even care about crypto start asking how to setup a MetaMask wallet, you know the Ethereum community is making waves in the world of no-coiners.
The highlight this week was Mike Winkelmann, aka Beeple, selling a Donald Trump NFT for $6.6M USD. You can read about it here. Beeple is famous for what he calls Everydays. The term refers to the fact that he has made one piece of digital art per day for the past 13 years. That’s dedication to the craft. He now has 1.8M followers on Instagram and 209k followers on Twitter. I think its safe to say that Beeple is the first NFT artist to gain worldwide notoriety. Here’s a snapshot of the piece that sold for $6.6M:
I should note that Beeple has sold many pieces as of recent for hundreds of thousands of dollars prior to this blockbuster sale and is therefore someone worth watching. A composite of the first 5000 Beeple pieces is going on auction at Christie’s auction house. Christie’s said that this is the first piece of digital art they are working with and are even accepting Ether as payment. This is a huge W for all the Ethereum investors out there as it marks a milestone in terms of a traditional institution dealing in the cryptocurrency Ether. To commemorate the occasion, Beeple is dropping a new collection of NFTs on makersplace.com. He is calling it the ‘Edition of 105’ which is dropping next week for $1 a piece. This NFT collection will likely sell on the secondary market for a substantial ROI if you can get your hands on one.
The madness doesn’t stop there however. Cryptopunks have been blazing across Twitter feeds and headlines this past week. On Opensea rankings, the project has done 23,000 Ether or $43M USD worth of volume in just the past 7 days. Recent sales have been in the tens of thousands of dollars for the lowest end Cryptopunks.
NBA Top Shots is also gearing up for its next drop. The project has quickly risen to being the #1 NFT project in the space. One of the main reasons for the project’s quick rise in success was its link to a big name brand, the NBA. Vancouver based Dapper Labs, the company behind NBA Top Shots, isn’t stopping there either. They have listed partnerships with the UFC and Dr. Seuss on their website. Their platform appeals to the mainstream collector in that you can just connect your credit card to the site and purchase NFTs on the site’s marketplace. You don’t need to have any knowledge of crypto wallets or Ethereum to purchase and collect NBA Top Shot moments.
With the space heating up, NFT investors and speculators are trying to decipher who the top artists are, when the drops will occur and what the next big thing will be. A few helpful metrics to view are transaction frequency and sales growth on one of the many marketplace websites like Opensea or Nifty Gateway. If there is a large market for a particular NFT, it will be traded frequently and be continuously bid higher. Similar to cryptocurrencies, community is everything. The bigger the following, the bigger the bids. These metrics are a good indication of a project being red hot but they certainly don’t imply long lasting valuations. Whether the NFT market continues along this trajectory is anyone’s guess this early on in the game. Just look at what happened to CrytoKitties. RIP.
I’m excited to see where the NFT space will go in the coming weeks and months. According to non-fungible.com, the NFT market has transacted $325M USD in volume. It’s really only blown up as of Feb 2021 so we’ll see how hot this market can get before needing to cool off. At current valuations, I’d say a cool off is likely and healthy for the ecosystem. With NFTs making mainstream news, the opportunity is no longer as asymmetric as it once was for the aspiring collector. At this stage it’s important to remember, only invest what you can afford to lose.
