In recent years, non-fungible tokens (NFTs) have exploded into a multibillion-dollar industry with new projects being launched daily. With celebrities and big brands adopting and minting NFTs, this new technology has gained massive media attention and is one of the most talked-about subjects in the digital world. Facebook’s recent rebranding to Meta hints at a new era of digital experiences, bringing digital assets to the attention of a wider audience. This guide introduces some of the biggest NFT projects in the world right now.
What are NFTs?
Fungible is an economic term that defines a good or commodity that is interchangeable with something else, regardless of its value. Non-fungible is the opposite. It is something that is totally unique and therefore not interchangeable.
Non-fungible tokens (NFTs) represent ownership of a unique digital asset in the virtual world. NFTs are constantly emerging in various forms and can represent digital art, music, digital real estate, in-game items, and other digital collectibles. Any real-world assets that are classified as non-fungible can also be digitally represented by an NFT and coded with unique details using a smart contract.
CryptoPunks NFT collection
Figure 1 – Eight CryptoPunk NFT characters
Launched in 2017 by Larva Labs, CryptoPunks is the most famous NFT project in the crypto world and the first to go mainstream. The rise in popularity of the project planted a seed in the NFT space, sprouting a new generation of NFT projects such as Bored Ape Yacht Club and Azuki.
CryptoPunks is a collection of 10,000 unique, 8-bit cyberpunk-style avatars, ranging from humans, zombies, apes, and aliens. CryptoPunks can come equipped with accessories, such as pipes, hats, glasses, shades, and more. The maximum number of accessories a Punk can have is seven, while it is also possible to have none.
Did You Know?
Aliens are the rarest form of CryptoPunk. Recently, an alien CryptoPunk was sold on OpenSea, the largest NFT marketplace, for $23.7 Million USD, almost doubling the sale of the previous record.
The project was initially an experiment by Matt Hall and John Watkinson, designed to explore digital ownership. Aside from keeping 1000 CryptoPunks for themselves, the rest were initially given away for free. But they didn’t stay free. Payment processing platform, VISA, bought a CryptoPunk for 49.5 ETH (or over $150,000 USD at the time of the sale). The most expensive CryptoPunK was sold at auction for $11.75 million.
Pop Quiz!
What are CryptoPunks?
Bored Ape Yacht Club NFT collection
Figure 2 – A random selection of Bored Ape Yacht Club NFTs
Inspired by CryptoPunks, Bored Ape Yacht Club also has a collection size of 10,000 NFTs. Each NFT is a cartoon ape that consists of different attributes involving facial expressions, fur colour, and accessories. The project was launched in 2021 by Yuga Labs, which recently acquired the NFT giant CryptoPunks. These are some of the most popular NFTs in the NFT market.
Bored Ape owners are given full commercial rights to the image and the NFT doubles as an exclusive Yacht Club membership. Members of the Yacht Club are granted access to member-only benefits including a collaborative graffiti board called “The Bathroom”, access to private events and discord groups, and free perks. An example of one of these perks is the Mutant Ape Yacht Club. Each Bored Ape owner is gifted a mutant serum that can be used to create a mutated version of their Ape. The floor price for one Mutant Ape is 20 ETH.
In March 2022, a new cryptocurrency called Apecoin was distributed to the holders of Bored Ape NFTs. Apecoin is a governance and utility token that serves the Bored Ape community and other associated NFT communities.
Interesting Fact
On release, each Bored Ape was listed for 0.08 ETH. Today, the cheapest Bored Ape available for purchase is 92 ETH. The sudden increase in price can be attributed to ownership by celebrities such as Eminem, Snoop Dog, Justin Bieber, Paris Hilton, Logan Paul, and Post Malone. Adidas has also purchased a Bored Ape and is partnered with Yuga Labs to advertise their apparel in a Bored Ape comic.
The Sandbox metaverse
Figure 3 – The Sandbox
The Sandbox project, launched in 2021 by The Sandbox Team, is the result of combining three major technologies: blockchain, NFTs, and DeFi. It’s a community-driven free-to-play metaverse that allows users to develop and monetise digital assets and games. Almost everything in the Sandbox universe is an NFT, from the clothes you wear to the land you’re walking on. Players can create their own NFTs such as in-game items, structures, avatars, and games. These NFTs can then be traded on the Sandbox marketplace.
LAND is a plot of real estate in The Sandbox represented by an NFT. All virtual experiences will need to be built on LAND. Neighbouring LANDs can be combined to form an ESTATE to accommodate bigger creations. The largest possible ESTATE size is 24×24 LAND.
Currently, The Sandbox isn’t an official full-release game. The Sandbox Team are running alpha tests to collect feedback through Alpha Seasons; multi-week events that allow players to participate in virtual experiences and potential Play to Earn rewards.
In Alpha Season 1, players were only able to participate in events and P2E rewards by owning a season pass NFT. In 2022, during Alpha Season 2, players are able to access all the experiences without having to own a season pass. Season passes will be given out to players through social contests and a raffle at the end of the season. Players can acquire raffle tickets for free by participating in events and completing quests.
SAND is the native token used in The Sandbox. Players can use SAND to play games or buy virtual land or in-game items. If a player has a season pass, they will be able to claim up to 1000 SAND tokens as P2E rewards.
Decentraland
Figure 4 – Decentraland
Decentraland is the first fully decentralized virtual world, developed by Ari Meilich and Esteban Ordano. It opened to the public in 2020. Being a decentralized autonomous organization (DAO), citizens of Decentraland will be responsible for the governance and development of Decentraland. NFTs in Decentraland represent plots of land and in-game items.
To vote on in-game policies, users will need to own digital real estate or hold Decentraland’s native cryptocurrency, MANA. MANA can be traded on exchanges for crypto or fiat and can also be used to purchase in-game assets such as clothes and accessories, usernames, and land. You can buy MANA on the Swyftx crypto exchange.
Decentraland is made up of plazas, roads, and parcels. Plazas are the initial spawn point of players and generate the most foot traffic. Although players will be able to teleport in Decentraland, there is a virtual road system to assist players in exploration. Parcels serve the same functionality as LAND from The Sandbox. Multiple parcels can be merged to form estates to allow bigger experiences.
There is no technical specification for what can be developed in Decentraland, meaning that the possibilities are endless! Popular use cases have included games, social hubs, advertising, and gambling.
Axie Infinity
Axie Infinity was launched by Vietnam-based technology company Sky Mavis in 2018 and currently holds the number one spot for all-time NFT sales volume at $4 billion USD. The game has over two million active users, making it one of the top NFT projects around.
Axie Infinity is a Play to Earn video game heavily inspired by the popular Pokémon series and uses deck building and battling mechanics similar to Hearthstone and Slay the Spire.
Each Axie is an NFT with a set of traits and abilities. Axies can be bred to create new Axies, however, breeding requires Smooth Love Potion (SLP) and Axies can only be bred a maximum of seven times. Players can use Axies to earn themselves SLP by battling against other players and playing the campaign. SLP can also be traded for local currency. Axie Infinity also has a ranking ladder, where the top players globally have a rewards pool of 3,000 Axie Infinity Shards (AXS). The rewards are given out at the end of the season, with each season lasting between one to two months.
The value of an Axie can be based on numerous things such as rarity, type, genes, and breeding count. New seasons undergo balance patches, and these updates tweak the performance of certain Axie traits, affecting their value on the market.
Did You Know?
35% of Axie Infinity traffic comes from the Philippines. Being a low-income country, playing Axie Infinity can be quite profitable for its citizens. Some players have been able to earn above the average national wage by playing the game.
The future of NFTs
With the popularity of NFTs continuing to rise, there are already many cases where NFTs have been utilised: memberships, concert tickets, in-game functionality, and real estate. But the possibilities are endless. There might come a day when you no longer require a passport, driver’s license, or event ticket, just an NFT stored on the blockchain that can’t be faked or reproduced.
The metaverse and NFTs go hand in hand, and with large corporations such as Meta (Facebook) and Microsoft building their own metaverses rapidly, the future of the NFT industry looks promising.
How do I buy an NFT?
There are a number of ways to purchase an NFT, but the easiest way to buy is through an NFT marketplace. There are several NFT marketplaces, such as Foundation and OpenSea, that allow users to buy NFTS and sell them as well.
Conclusion
There has been a tremendous amount of growth in NFTs in recent years, but it’s possible that this is just the tip of the iceberg. Two popular NFT collections that have led the way (particularly in the NFT art space) are CryptoPunks and Bored Ape Yacht Club. NFTs have also played a big role in large-scale metaverse projects such as The Sandbox, Decentraland, and Axie Infinity, where they represent characters, land, or in-game assets. With these projects continuing to evolve, and celebrities and big brands showing interest in NFTs, the future of NFTs is exciting and immeasurable.
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