By now, you've heard about NFTs, you know, non-fungible tokens. I spent a lot of time in the space. My partner and I consult for several companies in the space and we're spearheading a blockchain-based NFT game called "Robo Rampage," but that's not what I want to talk about this weekend. Instead, I want to turn my attention toward digital art, specifically generative art.
I'm likely going to butcher this in the eyes of the project managers behind generative NFT art creations, like Bored Ape Yacht Club (BAYC), the Royal Society of Players (RSOP), GOATz, or Gutter Cat Gang. If you haven't heard of these, then you might have heard about CryptoPunks, the biggest player in the space, or hot new projects on the way like The Glue Factory or one I'm really excited about, MetaChamps NFT. There are at least three dozen other projects that come to mind, and I mean no disrespect leaving any out.
Chances are either you're with me here or yours eyes glazed over and I am speaking another language. Either way, it's fine, as long as you keep going.
The challenge for old school traders and folks that deal in stocks and bonds is understanding the value in NFTs. I can't tell you the number of times I've heard this is a fad and everything is going to zero. It might, but I think there is a simple explanation to understand why there is value. And, no, the answer isn't the world has gone crazy. Well, it kinda has, but this isn't the cause or the result.
How I see it is there are quite a few stock-centric folks screaming that a BAYC NFT selling for $43,846 is crazy. (That's the current lowest priced BAYC NFT you can buy on OpenSeas right now.) By the way, these are priced in Ethereum, but most reading this think in fiat. I digress.
This is crazy right? Who would pay such a thing? Or how about $2,000 or $1,000 or even $500, which are prices you'd be lucky to find on solid projects, let alone hot projects. What do you get for such a thing? Again, I'm not an expert in any of these communities, so I hope no one involved will butcher me, but investors and traders need to adjust there thinking.
People aren't buying a JPEG.
Say it with me again. People aren't buying a JPEG.
People are buying community. People are buying access to events and experiences. The most successful projects have been about creating a community. Think of it like a digital country club. The price of admission is the cost of the NFT. And that's a one-time cost.
I live in Austin and have plenty of country clubs around me. They range in price from a few thousand per year for a social membership to hundreds of thousands of dollars per year for prestigious clubs. I can't tell you how many people I know who belong to these clubs and only attend events or visit the club a few times per year. Sure, there are diehards, but many join for the social status and some social mingling. These NFTs aren't any different, except the communities are online.
Events happen, in-person events, and you need the NFT to attend. Discords (a chatroom software) exist only for the NFT holders. Afterall, much of the world has gone digital. Younger generations have grown up living online. Kids "spend" more time with their friends online than they do in person.
When I began thinking of the generative art NFTs in that manner, a digital country club, the prices began to make more sense to me. And like with brick-and-mortar country clubs, you have your more exclusive and more affordable digital country clubs, as well. And the craziest thing is we haven't begun discussing NFTs plus gaming and the entire access of play-to-earn, but I'll save that for another time. For those not familiar with NFTs this was a lot to swallow.
And if you're interested in this space and looking at new projects, I'd keep a close eye on the MetaChamps NFT project. It's one I plan to buy aggressively upon release. The folks behind it are incredibly smart and likely to create a lot of value for those who can buy in upon the initial minting of the NFTs.