A lot of people, celebrities inclusive, have purchased an amount of NFTs, thereby increasing the demand for them. Celebrities seem to be quite into Bored Apes and CryptoPunks… and You should know by now that NFTs are not going anywhere, and if you don’t, well, now you know! BUT, can they be a good investment?
One of the many NFT projects that have made a mark over the years is the Bored Ape Yacht Club, also known as BAYC created by Yuga Labs. Yuga Labs also created the Bored Ape Kennel Club (BAKC) NFTs, which is an airdrop of BAYC-inspired dogs, and in August, proceeded to release the Mutant Ape Yacht Club (MAYC) NFT collection. Out of the top 10 NFT collections, Yuga Labs owns 5 of them!
Market caps (as of 10th August):
- BAYC: $1.44 billion
- MAYC: $0.54 billion
- BAKC: $0.141 billion
- CryptoPunks: $1.3 billion
- Meebits: $0.16 billion
- Otherside: $0.38 billion
- Apecoin: $2.2 billion
- Total: $6.16 billion
Yuga Labs seems to be a huge marketing machine with the largest community of followers, a total of 2 million Twitter followers if we have into account the cumulative followers for all the NFT collections above.
The BAYC is arguably the most popular NFT project in the world. This NFT collection is based on the Ethereum blockchain, and it’s a collection of 10 000 unique Bored Ape NFTs. Although this NFT collection has quickly become one of the most expensive NFTs, it hasn’t stopped so many people from buying it.
On the other hand, ApeCoin is a new cryptocurrency that relatively entered the market on March 17th, 2022. It was developed by the ApeCoin DAO. Being the creator of the BAYC, Yuga Labs serves as a community member in the ApeCoin DAO. The Yuga Labs ecosystem, also known as the Yugaverse, runs on ApeCoin, which is their native cryptocurrency. This means that ApeCoin is the primary token for all Yuga Labs projects. This is really great because it aligns the Ape ecosystem with the crypto/decentralization ethos and puts the decisions in the hands of a DAO.
We can also say the Yugaverse is one of the biggest or the biggest Metaverse ecosystem (learn here what this is).
When ApeCoin launched, it caused a lot of buzz and excitement and performed really well in the month after the launch by tripling its value. ApeCoin was first distributed to Bored Ape Yacht Club NFT holders and has a total fixed supply of 1 billion. The supply will neither increase nor decrease. A portion of the tokens for the contributors will be locked initially and then unlocked over 48 months.
The distribution of ApeCoin is among 4 main groups, namely: 62% goes to the ecosystem fund, about 16% goes to Yuga Labs, 14% goes to launch contributors, and 8% goes to BAYC founders.
ApeCoin has a circulating supply of 306,875,000 APE.
In comparison with the Bored Ape NFT, we want to consider this from the investment perspective and see which one would be a better investment.
Generally, all investments carry some degree or level of risk. NFT investments and cryptocurrency investments are not exempted (at all).
NFT investment is a risky investment. They can be a very good investment if you’re able to purchase them before the value appreciates. But like many investments, you’re not certain if and when their value is going to increase. You should NOT invest in NFTs more than a very small % of your money/wealth.
Collecting a BAYC NFT gives you access to so many benefits, such as access to an exclusive online Yacht club and real-world private events.
Bored Ape NFT holders own the IP rights and so can profit off commercializing their Bored Apes. So you have the right to sell your Bored Ape merchandise, such as t-shirts. But then, you need to own a Bored Ape NFT first. This may be a great way to leverage the Mataverse for Marketing.
One major con of investing in a Bored Ape NFT is that for an average investor, the BAYC NFT is too expensive and might not even be realistic. When the Bored Ape NFTs initially launched, they were sold for 0.08 Ethereum, that’s about $200 at the time. Currently, a Bored Ape is valued at about $144,000 at the time of the writing of this article. You either have money to own a Bored Ape NFT, or you do not. Buying one is a serious financial commitment, and you’re not even sure if you might make more money back later on.
Even if you have the financial power to purchase a Bored Ape NFT, it is not advisable to invest in it majorly because a lot of celebrities endorsed it or because it is popular.
ApeCoin, on the other hand, is a cryptocurrency that has been described to be one of the best Metaverse cryptocurrencies. ApeCoin has several use cases, and this could potentially impact the price or drive the demand for ApeCoin in the future, hence showing us whether it is a good investment or not.
The ApeCoin is a governance and utility token. Access to this token means access to participate in the governance of the Apecoin DAO. ApeCoin holders can also get to make decisions regarding future projects, partnerships, rules, and other benefits. Asides from gaining access to exclusive features such as games, merch, events, and so on in the ecosystem, ApeCoin holders can make use of this token as a currency for transactions within the ecosystem. This is why it is the main cryptocurrency of the BAYC ecosystem.
The Ape Foundation is tasked with ensuring that the decisions of the ApeCoin DAO are administered and making sure that the DAO community ideas get all the support they need.
In the future, especially in Web 3.0, we also see a lot of use cases for Apecoin. Asides from the fact that it gives access to the Bored Ape ecosystem, it also gives access to a Metaverse of games. For example, the utilization of APE as an in-game currency for a P2E game named Benji Bananas and soon to be accepted by nWayPlay.
Another use case can also be the use of ApeCoin for merchandise sales by the BAYC NFT community by accepting ApeCoin as payment. This will increase the value of the token, making it a somewhat safe investment.
The ApeCoin can also be used as a means of paying for events. The Bored Ape is one of the largest NFT communities in the world. You can imagine how big their events can be. Since ApeCoin is associated with this ever-growing community, using it as a means of payment for events would only increase its value.
SHOULD I INVEST IN APECOIN?
Because ApeCoin is still new to the market, it is also wise to consider the price performance since it hit the market in March. APE started trading at about $7.26, hit an all-time high price of $26.24 in April, that’s barely a month after, and reached a low of $4 in June.
Currently, 1 APE is worth about $7 which is about 73.91% down from the all-time high price. Basically, everybody that bought ApeCoin when it first hit the market is now definitely at a loss.
Apecoin is supported by all the major exchanges since day 1, including Binance and Coinbase.
It’s good to always keep in mind that cryptocurrencies are volatile assets hence they are unpredictable. So prepare for unstable prices along the line.
Finally, please note that all of these judgments and conclusion is based on personal opinion and research, so it’ll be best if you also did yours before making any investment.
If you can’t afford to buy a BAYC NFT, investing in ApeCoin can be a better and cheap alternative.
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Disclosure: views expressed are purely personal and do not reflect any organisation’s views or thoughts the writer of this article may be affiliated or associated with. This is NOT financial advice and I’m not recommending anything. This article is only for educational purposes.