— CryptoPunks Bot (@cryptopunksbot) May 24, 2020
For those who have never heard of CryptoPunks, they are 10,000 uniquely generated characters – each represented as an Ethereum-based NFT. No two are exactly alike, with each Punk containing different types and traits.
CryptoPunks have been quoted by many as sparking the digital art movement on Ethereum, all of which and more are covered in detail in this article.
Here’s a quick glance at some of the most famous CryptoPunks in existence:
- Alien – 9 Punks
- Ape – 24 Punks
- Beanie – 44 Punks
- Zombie – 88 Punks
With a new floor price of over 1ETH and volume soaring this past week, let’s take a look into what’s been driving Punks for sale up to 100ETH.
Created by Larva Labs in the summer of 2017, CryptoPunks were the first Non-Fungible Token, made before the ERC721 standard was even solidified. In fact, the ERC721 whitepaper even references CryptoPunks as an inspiration for the token standard.
Punks were not sold, they were simply claimable by anyone with an Ethereum address willing to pay gas. This system made it different from your typical airdrop as only those in the know were able to snag one. Similarly, Punks can only be traded through the Larva Labs interface – arguably making it the first NFT DEX in existence.
While the vast majority were not immediately claimed after creation, this article from Mashable set up a flurry of demand in which the remaining ~8000 Punks were scooped up in a matter of 48 hours.
— Pranksy (@pranksyNFT) May 28, 2020
When asked for comment on why sales are up, many have told DeFi Rate that CryptoPunks demand is cyclical – with Punks seeing a strong surge in volume as Ethereum reaches a new level of growth never before seen. Others have suggested the owning a Punk is like owning a piece of history.
With DeFi’s Total Value Locked nearing an all-time high and the price of Ether surging, some could theorize that the spike in Punk volume is a strong indicator we could be entering a new bull market in the coming months.
The sale of Punks also introduces another interesting dynamic – an Ether furnace. As pointed out by Larva Labs, many Punks were put up for sale immediately after being claimed in 2017, many of whose accounts have not been active since the day they were listed. In the case of this Punk, this means the 100ETH spent may never see the open market again.
This is a very good point, and something people might not know: the punks have been around long enough now that the person who sold this punk may not realize they sold it, and might conceivably never collect the money. (thread) https://t.co/DmJCsTaZ05
— Larva Labs (@larvalabs) May 24, 2020
NFTs in DeFi
Tying it all back together, the advent of NFTs was the first of many popular sectors that continues to see strong growth today. With a number of blockchain games integrating DeFi primitives like Maker Dai’s Gaming Intiative, Compound cTokens and PoolTogether tickets under the hood, many have been quick to point out gaming and DeFi as close cousins in the wider Ethereum landscape.
Fat Cryptopunks Thesis:
Every successful collectible NFT on ethereum traces their lineage to those 10,000 punks. Each time a collectible NFT becomes important to someone, the cultural significance of the Cryptopunks gets just a little bit bigger.
— scott lewis🌾 (@scott_lew_is) May 28, 2020
If one thing is for sure, CryptoPunks have certainly piqued our interest, and we’ll be keeping a close eye on them in the coming months.
Cooper is the Editor of DeFi Rate. He is an ambassador of Set Protocol and an active contributor to MetaCartel where he seeks to find emerging consumer-facing applications that propel the Ethereum ecosystem. He often works with projects as the Director of Fitzner Blockchain Consulting where he coauthors the weekly publication Token Tuesdays.
Like my writing? Drop me some gwei @ coopahtroopa.eth 😉