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This week I want to chat briefly on NFTs.

The NFTs market has heated up to unprecedented levels. Axie Infinity's daily revenue has crossed $12m dollars and the cumulative 7d revenue is nearly $90m. In terms of revenue, nothing in crypto even comes close. This includes entire chains.

Axie's story definitely rejuvenated the NFT market, but lately, all eyes have been mainly on CryptoPunks.

The OG unique 10k pfp project saw a spike in popularity back in February 2021, where sales figured in $ 12x'd from $6mln a month to $77mln. Since then, the market never calmed down -- peaking in July which saw $135mln in sales with nearly 1,400 unique transactions. We're only 5 days into August, and sales already topped $80m, with the average purchase sitting at around $157k.

What caused this massive uptick?
1. An increase in interest in the NFT space
2. OG status
3. Large, 8 and 9 figure wallets started sweeping the floors alongside buying very rare pieces
4. Speculation caused by the booming pfp NFT scene - Bored Ape Yacht Club, Moon Cats, SupDucks and more
5. Speculation caused by the booming NFT scene in general - ArtBlocks, blitmaps, even the Pet Rock contract from 2017 (which saw increased minting around August 4th -- some rocks sold for $40k!)
6. News about big funds entering the fray
7. Increased adoption by celebrities and known figures

It creates some sort of flywheel, because the market is so illiquid.

- There is a limited number of pieces
- Rarities, traits, aesthetics and token ID all play a factor in pricing and price discovery
- Influencers shill a project
- This creates FOMO, as people who are not as price-sensitive ape into the asks
- This in turn pushes the price floor up, a lot.
- Price floor goes up --> people FOMO. They're reading more and more about people who flipped their Punks or Bored Apes' for 2x in a matter of days. And mind you, the figures aren't small. People made 6 figures in profits flipping a singular NFT within a week.
- People FOMO and ape into the current asks, pushing the price even further up.
- On and on it goes.

Note: it rarely works on the way down, especially for highly touted projects, because whales/collectors are operating bots and are primed to sweep the floors if asks get too low.
Illiquid markets pump the hardest.

How big is this spike? Is it just for CryptoPunks?
The answer is no.
July + August (so far) cumulative sales (data by cryptoslam.io):

ArtBlocks: $92,245,538
BAYC: $75,388,301.2
Meebits: $27,268,828.52 (Long way from May's $65.6m)
Cool Cats: $19,304,720.36
Vogu: $12,723,532.84

We're seeing an increase in everything across the board - NFT funds, NFT collector DAOs, Gaming DAOs, marketplaces and integrations, you name it.

I expect the NFT scene to continue to boom with the bull market, and it remains to be seen what will happen to the market across the board if ETH were ever to dump tremendously, as pieces are denominated in ETH for the most part.
I do however expect most pfp projects to eventually hit 0.

Interestingly, Ethereum is not the only blockchain to have NFTs and an NFT ecosystem, so the numbers presented here are in the lower bound for the entire NFT market across all chains.

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Shualpha