This article is from Nansen, original author: Yasmine Karimi; Original title: CryptoPunks: What's Behind Their Unstoppable Rise? Translator: Shirley
<h2>What are CryptoPunks? </h2>
Made up of a collection of 10,000 unique and collectible characters, CryptoPunks is widely regarded as the beginning of today's crypto art movement. Larva Labs released CryptoPunks on June 23, 2017, when anyone could claim a CryptoPunk for free.
So far, according to Nansen data, the price of Punks has risen to between 100.5 ETH (about $381,000) and 4,200 ETH (about $7.58 million), with a market capitalization of 1262143 ETH (about $4.5 billion), making it the largest NFT collection.
Price changes since launch
<h2>What is driving the growth in the value of CryptoPunks? </h2>
Many observers try to understand the price that collectors have recently paid for CryptoPunks and observe the formation of speculative bubbles. Still others argue that the value of CryptoPunks is driven by factors other than the NFT hype, and that this recent trend may just be the beginning of a wave of reinventing art collections.
In this article, we will further elaborate on the potential drivers behind the value of CryptoPunks, as well as the potential trends that can be predicted in the short and long term of the project.
<h2>The fundamental driver behind the value of CryptoPunks</h2>
The first NFT project in history
The first fundamental driver behind the value of CryptoPunks is that it is the first NFT project in history. This narrative gives CryptoPunks a unique place in the field of similar NFT collectibles.
This sounds impressive, but what does it mean to be the first NFT project, and what is the connection between the two?
This means it is the first project to use blockchain technology to represent unique asset ownership, with three groundbreaking implications:
First, CryptoPunks revolutionized the art and art markets. By using blockchain's proof-of-ownership technology, CryptoPunks eschews third parties involved in art transactions. Artists can now interact directly with audiences to buy and sell their work. The application of blockchain technology in art in particular has made digital art and collectibles scarce in the digital world. Previously, due to the reproducibility of these works, the way they existed was not rare and valuable.
Second, the model built by CryptoPunks allows the emerging asset class of NFTs to emerge in a broader form. While art is a use case, other non-homogeneous assets (such as jpegs, memes, certificates, patents, etc.) also become scarce and valuable through the use of proof-of-ownership techniques.
Finally, they inspired the creation of the ERC-721 token, a token standard that supports non-homogeneous assets. They are cited even in the latter's white paper.
Scarcity
CryptoPunks are not only important in the culture of the NFT field, but also characterized by scarcity. They would not have become so valuable without a ceiling of ten thousand, making it difficult to obtain.
CryptoPunks are scarce both in terms of collectibles level and collectibles scope, as some Punks are considered rarer than others.
The value of a Punk depends on its type, number of attributes, combination of attributes, and subjectivity. There are 5 types of Punk, namely Alien, Zombie, Ape, Male and Female, in addition to 87 different attributes, each punk can stack up to 7 attributes.
In general, the three types of aliens, zombies, and apes are considered more valuable. The average price of an alien is usually 16 times the average price of a male Punk.
In terms of attributes, Punks with 0, 6, or 7 attributes are considered more valuable.
The most sought after features tend to be the most eccentric and punk-style. Currently, the Characteristics of Punk with the highest average price are as follows:
Beanie;
Pilot Helmet;
Hoodie;
Triple crown (Tiara);
Choker;
Top Hat;
Orange Side;
3D glasses (3D Glasses);
Welding Goggles;
Gold Chain.
It's worth noting that Punks with the most valuable traits aren't always the more scarce ones. If we look at the value that these traits produce over time, we find that the popularity of traits changes over time, which is interesting.
Top 10 Trait Values Change Over Time
As you can see in the chart above, some previously less popular traits, such as hoodies and pilot helmets, have gained redoubled attention.
Therefore, it is important to follow feature-related discussions in the CryptoPunks community (such as Twitter and Discord) and use recent sales history as a reference.
<h2>Social currency within the OG community</h2>
As mentioned above, CryptoPunks has a unique historical position and limited supply. This scarcity satisfies the need for CryptoPunks to become a social currency in the OG (original gangster) community and in the NFT realm.
When you buy CryptoPunk, you're not only buying a picture, but you're also buying memberships for the coolest and most "OG" clubs in the NFT space. The membership of this club is very powerful. The message is that you're a leader, you recognize the historical significance of this project, and you're notable in the NFT space. It can also help unlock features such as social networks, exclusive conversations, and free claims of other NFT collectibles such as Meebit.
The increasing demand from OGs and the entry of new market participants will drive prices higher
Over time, we will see an increase in demand from different market participants. The OGs will take the profits they make back into Cryptopunks, or at least they will take what they already have. They are experienced collectors. As the chart below shows, CryptoPunks' Top 5 holders are predominantly original collectors who still hold 14% of the total number of CryptoPunks.
CryptoPunks Top 5 holder
However, looking at the evolution of transactions between different types of NFT collectors over time, we will find that the transactions of "legendary NFT collectors" account for a smaller and smaller proportion of total transaction volume (in terms of ERC 721 token trading, legendary collectors represent the top 0.1% of collectors).
The trend of the type of NFT collector who buys CryptoPunks is changing
In fact, although initially the collection was largely concentrated in whale hands, the number of CryptoPunks owners has been increasing over time, suggesting that the collection form has become more decentralized and healthy. Currently, CryptoPunks has about 3,000 owners.
The total number of unique addresses held by CryptoPunks changes trend
These new entrants include high net worth individuals, investors, celebrities and influencers. It can be assumed that these people have been incentivized by short-term or long-term profits, as well as the socio-monetary attributes associated with CryptoPunks.
Two other trends are also evident. Last week, Visa purchased the Punk 7610, suggesting that NFTs are increasingly attracting attention from institutional investors. In addition, the emergence of NFT fragmentation has also released a new share of market participants, allowing multiple people to co-own an NFT.
The growth of the NFT market further solidifies Cryptounks' position as the first such product
Some successful collectibles NFT projects are emerging, such as Autoglyphs, Bored Ape Yacht Club, and Art Blocks, which trace their origins back to CryptoPunks, allowing the latter to continue to appreciate. In addition, with the continuous maturity of the NFT field and the combination of technologies such as metaverse, VR and AR, CryptoPunks will become more powerful and practical.
Today, CryptoPunks is also being spread more and more widely in different media and industries, such as CryptoPunks comics and clothing inspired by it. Some members of flamingo DAO have even created a 3D rendering model in the metaverse for their Punks, and Larva Labs' agreement with the United Talent Agency means they will soon appear in film, television and other media. This "cross-border collaboration" will make CryptoPunks more popular. The combination of increasing interest and scarcity will drive cryptoPunks appreciation.
CryptoPunks will surely become a store of value
With only one OG NFT project available, CryptoPunks will continue to be unique in the space and become a social currency. As the NFT space matures and new market players seek access to CryptoPunks, demand for this collection will grow. When this growing demand meets the 10,000 cap of CryptoPunks, CryptoPunks will appreciate. Over time, Punk is bound to become a store of value, and it is certainly the most resilient asset in the event of a "bear market" in the NFT market.
<h2>conclusion</h2>
In summary, some of the fundamental factors of the rapid growth in the value of CryptoPunks can be summed up simply as "the first NFT project in history", "scarcity" and "related social currency". The above factors will continue to push the value of CryptoPunks to a higher level. While we can predict some short-term fluctuations that reflect the ups and downs of the crypto space, in the long run, the value of CryptoPunks will only move in one direction. CryptoPunks will remain one of the most mature Bluechip NFT series.
And that's just the beginning. The NFT market will continue to evolve and CryptoPunks will forever be seen as the origin of NFTs and gain more value over time. Although the value of these collections has grown alarmingly, the value of Punks is expected to become even higher by 2025.
[This article was originally published in ChainDede, authorized by Titanium Media App, author: Song Song]