What Are CryptoPunks? NFT Guides
The NFT craze has been through the roof since Q1 of 2021. The NFT market grew over 20x from 2020 to 2021. Currently, the market’s total value is around $3 billion and is expected to increase to $13.6 billion by 2027.
The 2021 NFT fever gave birth to a number of superhit projects, such as Bored Ape Yacht Club (BAYC), which exceeded the $2 billion sale volume. However, even BAYC owes its success to the NFT project that started it all: CryptoPunks.
If you are new to the NFT space and don’t know about CryptoPunks, you’re at the right place. This article will dive deep into the topic and help you figure out what CryptoPunks are and what’s the reason behind the project’s enormous hype.
What are CryptoPunks?
Simply put, CryptoPunks is a collection of 10,000 digital art avatars. Each avatar is a 24 by 24 PFP jpeg image created using the 8-bit pixelated style. As apparent by the name, their appearance is inspired by the London Punk Movement. Being generated algorithmically, every avatar is completely unique and different from others in terms of its features, called traits.
All of the 10,000 CryptoPunk avatars are non-fungible digital assets. The term non-fungible means that the token can neither be replicated nor replaced. Another perk of NFT technology is that you can own these digital assets in a literal sense. Ownership of each token is recorded on the blockchain ledger, which makes it impossible to destroy or modify it.
As a result, every CryptoPunk NFT can be treated as a real-world art piece or antique. Think of it this way: though there are tens of thousands of prints of Vincent Van Gogh’s Starry Night, only one original painting exists. Similarly, though anyone can take a screenshot of CryptoPunk NFTs and save it on their devices, only one person truly owns the token.
Out of the 10,000 CryptoPunks, there are 6,039 male and 3,840 female Punks. The rest include 88 zombies, 24 apes, and 9 alien Punks. Each CryptoPunk exhibit a unique combination of 87 traits, such as hates, eyepatches, necklaces, earrings, pipes, and more.
The CryptoPunk with the maximum number of traits(7) is #Punk 8348. This NFT has a cigarette, buck teeth, shades, earrings, moles, a top hat, and a beard, making it extremely rare. There are also 8 CryptoPunks with no traits at all. Both the number of traits and their rarity drive the price for each NFT.
Who Created CryptoPunks?
You’d be surprised to know that CryptoPunks was started as an experiment. The project was launched in 2017 by two Canadian software developers, Matt Hall and John Watkinson. Hall and Watkinson identify themselves as ‘creative technologists’ and are the founders of Larva Labs – a US-based company that also created MeeBits and Autoglyphs.
Hall and Watkinson developed a software program that would generate thousands of pixelated avatars of non-conformists and misfits. The original idea was to use the program and the avatars in a smartphone application or video game which was also inspired by the London Punk Scene.
Little did Hall and Watkinson know that their experiment would gradually climb its way up to achieve massive success and pioneer a multi-billion dollar NFT industry. The collection went live in June 2017. Originally, all the CryptoPunks were given away for free. Anyone with an Ethereum wallet could acquire a Punk NFT for free. After giving away 9,000 CryptoPunks, the developers kept the rest for themselves. These NFTs are now called Dev Punks.
At that time, the NFT marketplace was nowhere close to what we see today. Blockchain ownership and digital assets were entirely new concepts. CryptoPunks had a slow start. For the next few years, there was no real hype for CryptoPunks.
Fast forward to 2020, the concept of digital assets and NFTs began to gain some popularity. In 2021, the trend really picked up, and the demand for these digital images with provable ownership on blockchain skyrocketed.
Being one of the oldest NFT projects, CryptoPunks became the most sought-after. These NFTs, which were being sold from $4 to around $70, ended up in several multi-million-dollar sales and auctions. For example, CryptoPunk #1422 was sold for $74.21 four years ago. Almost ten months ago, the same Punk secured a sale of 500 ETH, equal to about $2 million at the time of the sale.
What Makes CryptoPunks So Valuable?
Over the years, the CryptoPunk NFT collection has become an investment option and store for value. Several high-profile celebrities, including Serena Williams, Jay Z, Steve Aoki, Gary Vee, and Jason Derulo, have purchased CryptoPunks over the years.
But what is it that makes this NFT project so special? Well, it’s several things. First, CryptoPunks is one of the earliest projects in the NFT space. This fact makes it an essential part of the history of this industry. The project and the community around it grew along with the Ethereum ecosystem. Hence, just like any other type of collectibles, such as antiques or paintings, the historical significance makes CryptoPunks highly valuable.
Moreover, with time, CryptoPunks have become a status symbol. Many individuals purchased the NFTs simply to flex. For them, having a CryptoPunk avatar as their profile picture on social media accounts is the same as wearing a Rolex or driving a Rolls-Royce in real life.
Even the general crypto and NFT community sees Punks owners as thought-leaders and visionaries. The rarer the avatar, the more prestigious the person, is considered. True or not, over the years, the CryptoPunk collection has gained this rank for itself, which further adds to its value.
How to Buy CryptoPunks?
If you’re impressed by CryptoPunks and want to purchase one, you can do so using ETH and Metamask wallet. The only place to buy and sell CryptoPunks is the official marketplace built by Larva Labs. Moreover, since all 10,000 NFTs in the collection have already been created, you can buy them only from other owners.
First of all, you need to acquire some ETH tokens. Quite a bit, honestly. At the time of writing this article, the cheapest CryptoPunk NFT is priced at around 66.5 ETH, which is equal to more than $100k.
The easiest way to buy ETH is from centralized crypto exchanges, such as Coinbase, Binance, Gemini, etc. You can always go with decentralized exchanges, which usually have lower trading fees. However, the former option is more suited for beginners as it is straightforward.
The next step is to set up your Metamask wallet. You can do so by downloading the Metamask browser extension and creating an account. After then, transfer the purchased ETH to your Metamask wallet using the wallet address.
Now visit the CryptoPunks marketplace and connect your Metamask wallet to it. You will find a list of all the Punk NFTs available to buy. Place an offer for any of them and wait for the owner’s response. If the owner accepts your offer, the Punk is yours!
From time to time, CryptoPunks can also be found listed on different auctions. A few months ago, Southby’s held an NFT auction for a lot of 104 CryptoPunks. The entire lot was estimated to be worth $20-30 million.
Yuga Labs’ Acquisition of CryptoPunks
In March 2022, CryptoPunks’ journey took a new turn when Yuga Labs – a US-based blockchain technology company – bought CryptoPunks and MeeBits from Larva Labs. Yuga Labs has already created the globally successful Bored Ape Yacht Club. After this acquisition, the company is now the owner of arguably the three biggest NFT projects.
In a statement, the Larva Labs representatives said that the reason behind handing both projects to Yuga Labs is that they believe the company to be better-suited stewards. “Yuga Labs are the best in the world at what they do, and are the ideal stewards of the CryptoPunks and Meebits. In their hands, we are confident that they will continue to be vital, thriving projects in the emerging decentralized web,” said Larva Labs co-founders.
Soon after the deal was done, Yuga Labs announced to give IP, commercial, and exclusive licensing rights to the Punks owners. This move will allow the individuals holding CryptoPunks to create and capitalize the artwork and products based on their avatars.
There is absolutely no doubt that CryptoPunks has already established a legacy. The project has increased from zero to several million dollars in just five years. No matter how much the NFT space expands and how many new projects come to the surface, CryptoPunks is always going to be among the most popular ones. Why? Because this project is what laid the foundations for the entire industry.
With Luga Labs now being the new owner of the project, the world is eager to see what’s next for CryptoPunks. While the company hasn’t revealed its plans yet and is waiting for the community to build around the project. Meanwhile, the price for CryptoPunks continues to fluctuate in the NFT market.
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