What sparked the CryptoPunk frenzy?

Note: The original author is bankless co-founder David Hoffman.

Note: The original author is bankless co-founder David Hoffman.

Watching Ethereum is like watching a TV show that moves forward by 1 frame every 12 seconds.

As a transparent ledger, we can see the progress story of each new block of Ethereum, new events in the Ethereum soap opera will be appended to the blockchain, and we watch the drama unfolding in real time together.

That’s what it’s like to watch “Ethereum TV” this weekend, and here’s my summary explanation of the events of the past few days, the weeks leading up to them, and upcoming events in the future:

• After EIP 1559 goes live this week, and it will play an important role in the overall Ethereum story, all eyes will be on the Merge.

• At the same time, the "NFT bear market" is actually an opportunity to grab NFT land, and the larger market is finally realizing it.

• With the development of Ethereum, more and more people believe that Ethereum will become the leader of the world's value settlement layer.

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1 Grab something on the table

CryptoPunks was already a hot market last week, but things took a new turn when someone bought a knit hat ape cryptopunk for 1,600 ETH ($3.7 million).

The buyer turned out to be Gary Vee (remember when we had him as a guest at Bankless?)

And three hours later, someone followed suit and bought a golden chain ape cryptopunk with 2200 ETH ($5.5 million).

…Then, there was a rumor on Twitter that Three Arrows Capital (3AC), led by Su Zhu and Kyle Davies, bought 100 different CryptoPunks and even negotiated with miners to make sure their CryptoPunks were all included in the same block middle.

Later, everyone discovered that it was not 3AC who bought a large amount of CryptoPunk this time, but a member of the CryptoPunk community, who "swept" all the cheap CryptoPunk that could be bought.

Of course, Three Arrows Capital (3AC) is indeed also buying CryptoPunk and other "blue chip" NFTs.

All this was enough to send the CryptoPunk market into a frenzy over the weekend, with almost every metric setting new all-time highs, including total sales, unique new buyers, average value (USD), and total transaction volume.

"CryptoPunks" even started trending on Twitter.

Punk mania has also had a huge impact on other NFTs, and the floor prices of many NFTs have experienced substantial growth.

“Since 3AC stepped up its acquisition efforts, the floor prices of these projects have experienced a surge:

Punk floor price rises from 22 ETH to 34 ETH
Autoglyph floor price increased from 120 ETH to 385 ETH
Fidenza floor price increased from 19 ETH to 37 ETH
Ringer floor price increased from 17ETH to 35 ETH
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2 Why now?

So why does this happen? What was it about Friday and Saturday that sparked Punk's frenzy last Friday and Saturday?

You’ve probably heard the phrase “NFT bear market” over the past few months. This sentence is mainly uttered by those who do not pay attention to the NFT industry. They take the NFT industry as a whole and then take it for granted.

There was a deep mass consolidation in the NFT world when many speculators got burned and left... which eventually led to a supply shortage in the secondary market.

This weekend's Punk frenzy was the result of a frenzied grab for the remaining supply of OG Ethereum culture NFTs, with participants betting that Ethereum is on its way to full mainstream.

“If ethereum becomes the settlement layer for value, then it will also be the settlement layer for culture.”

Bankless theorizes that a crypto protocol like Ethereum will become the settlement layer for world value. And CryptoPunks and other foundational NFTs with deep ties to Ethereum are the earliest cultural artifacts of this revolution, and are therefore inseparable from the protocol itself.

As Ethereum gains global recognition, so will NFTs representing core parts of Ethereum itself.

The Crypto revolution is not just a monetary and financial revolution, it will also manifest itself as a revolution in art and culture. I believe that as Ethereum slowly rises, enough people will, consciously or not, adapt to this reality and feel FOMO about owning a part of the OG NFT project.

This also finally led me to pull the trigger on Punk #1118:

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3NFT project drives up Ethereum gas price

Last week, several new NFT projects triggered multiple spikes in Ethereum gas prices to over 1,000 gwei.

Mila Kunis’ Stoner Cats NFT sold out in 35 minutes, which triggered some memories of the ICO boom in 2017, which also caused the gas price to soar to 1500 gwei at one point.

Just hours after the Stoner Cats were all sold, the Vogu Collection NFT sale caused gas prices to rise back above 1,000 gwei, and some recently released artwork NFTs also caused Ethereum gas prices to rise above 100 gwei.

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4 Most importantly, EIP1559 will be activated this week!

All this NFT madness, before EIP 1559 goes live (expected this Thursday).

Going forward, all NFT speculation and minting on Ethereum burns ETH, and last week's data suggests that NFT demand alone is enough to generate meaningful block space demand for Ethereum.

This article is from The Way of DeFi, reproduced with authorization.

This article is from The Way of DeFi, reproduced with authorization.