NFT (part 2): The New Digital Fan Club

4 mins read

Gordon Goner never had a real job, he had a gambling problem and was also a high school dropout before a sudden tsunami of success hit him. Are you familiar with the haphazardly constructed art pieces of Apes thatthe internet? Well, Goner and three other men are the ones behind Bored Ape Yacht Club — a collection of 10,000 NFTs.

Recently, 101 of the 10,0000 Yuga Labs’ Bored Ape Yacht Club tokens, which were first minted in early May, resold for $24.4 million in a hosted auction. Another auction followed shortly thereafter by another host who sold four apes for $12 million. Around the same time, one collector bought a single token directly from OpenSea — an NFT marketplace — for $2.65 million. Later, another hosted auction sale set a new auction record for the most-valuable single Bored Ape ever sold: Ape number 8,817 went for $3.4 million. The collection has since seen almost a $100 million in trading, with the cheapest apes often going for almost $14,000. Sounding close to crazy?

We are adapting to the digital society. The status of today is digital. We spend a great time online interacting with our friends and coordinating commercial activities. The NFT also represents the digital world. Today, NFTs have a lot in common with cooperative societies, but for the digital society. In this article we explore the adoption of NFTs for building communities. Because we spend more time in the digital world NFTs have become valuable. And another thing driving this is that people like to own (collect) things.

The NFTs Dominating the Market today

NFTs haven’t gone deep into other real-life applications like medical records, academic certificates etc. However, the prevailing flavour of the market is known as PFP (profile picture) projects – the leading application of NFTs today. They are usually avatars or animals and often a collection between 5,000 and 10,000 pieces. Sometimes they are pixel artwork, hand-drawn, or 3D profile picture projects. Examples are the Bored Apes and Fame Lady Squad profile picture NFTs.

You may be wondering how and why they are leading the marketing. At first it started as a fun project but today they have generated big revenues and communities for their producers. For instance, it was reported that tokens related to the Bored Ape Yacht Club ecosystem — this includes the traditional apes, but also things called “mutant” apes and the apes’ pets — had generated around $1 billion. Rolling Stone Magazine just announced a partnership with the Apes and is creating a collectible zine.

Why do I buy one of these PFP NFTs?

The PFP projects have a growing community. Owners can be entitled to various community benefits and this is synonymous with the benefits members of corporative societies enjoy. Bored Ape serves as a membership to Yacht Club and also serves as a digital identity — owner receives commercial usage rights, meaning they can sell any sort of spinoff product based on the art.

“Each avatar club is a strange combination of gated online community, stock-shareholding group, and art-appreciation society. When one ape (or cat or pill or alien) is bought for a high price, the perceived value of all ten thousand authentic N.F.T.s in the set rises, the same way a painting fetching a record price at auction might increase the value of an artist’s entire œuvre. When a buyer makes his Twitter avatar an image from a new N.F.T. club, it’s a sign of allegiance, and also a signal to other buyers in the club to follow him on social media.” — The New Yorker reported

Project owners are also selling NFT collections to raise funds for their ventures. As an owner of one of these PFP collections, you can be entitled to revenue sharing in the venture, tickets to events, right of passage into things, merchandise dropping, airdrops, sharing into royalties, video games applications, entitlement to other artworks, collateral for loans etc. Your benefits are defined by the creator of the NFT project.

How Artists are making new connections

Professional celebrities use NFTs to make their followers skyrocket. It represents a new avenue to connect to fans who may not normally be their fans. They reach a whole new level of fans. Artists connect to fans in a collection (like metaverse). When Snoop bought the virtual mansion on the Sandbox metaverse, he connected to fans on that metaverse. When people see a celebrity in the same collection as them they become fans of that celebrity. It has also been reported that some people gain hundreds of new followers the very same day they change their Twitter profile picture to the ape.

Conclusion

NFTs can be a groundbreaker for independent artists as they can raise funds and equally tap into new cultures and fan clubs. Purchasing the hot new avatar is synonymous with possessing some rights to the next Squid Game movie success.

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Sam Iso

Sam is a Solution Architect and Software Engineer with a deep interest in finance, data, community, mental health, and education. Connecting the dot is his superpower. Sam is exploring his curiosity and creativity to match that with what the world needs.

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