How Did CryptoPunks Become Such A Hype?: What Made Its Prices Skyrocketing?

CryptoPunks: An Overview And History 

CryptoPunks were created at the peak of crypto in 2017 by a team of two cryptocurrency enthusiasts, John Watkinson and Matt Hall, who call themselves Larva Labs. 

It was the period when the blockchain community was transitioning to the decentralized finance (DeFi) industry from the anti-establishment, crypto-libertarian Bitcoin movement. At the same time, eliminating any intermediaries between the money moving business and creating a fortune with skeptical initial coin offerings, Wilkinson and Hall were exploring anti-establishment art.

Before 2017-2018, most applications on the Ethereum blockchain were aligned with the ERC-20 token – a standard that allowed for digital assets to be fungible or mutually exchangeable with one another within the Ethereum ecosystem.

Earlier, applications on the Ethereum blockchain in the period before 2017-2018 were often aligned with the ERC-20 token – a standard that enabled digital assets to be mutually exchangeable or fungible with one another within the Ethereum ecosystem.  

In addition to the general features of an ERC-20 token, Hall and Watkinson made some changes to the software code to generate a new non-fungible standard or uniquely identifiable single token.

At that time, the modifications were quite an achievement in terms of digital ownership since it translates to the fact that the collectors will be able to own a fraction of the token or one-half of a Punk as in the case of most ERC-20 decentralized applications (dapps).

It is not rare that addresses CryptoPunks are airdropped additional assets (Meebits, also created by Larva Labs, is one such example). It shows the ecosystem’s continuation for CryptoPunks and their collectors.

Cut to the present, CryptoPunks are the most iconic NFTs to be created ever, and the collection is even considered a catalyst for the modern art movement of crypto. CryptoPunks have become the identifier of legitimacy and identity for their holders due to their status quo in the crypto ecosystem. 

Using a set of algorithmic templates, the final design of each 24×24 8-bit-style pixel art image, which was inspired by the 1970s’ London punk scene and the dystopian grit of cyberpunk, was randomly generated and could not be changed once it went live on the Ethereum network.

CryptoPunks was introduced as an experiment to explore the demand and scarcity dynamics and as an antipode to the malleable and centralized nature of mainstream collectibles such as Pokemon cards. With the use of a set of algorithmic templates, the final design of each 24×24 8-bit-style pixel art image was randomly generated and unchangeable once it went live on the Ethereum network.

Since its inception in 2017, the NFT value has gradually increased. However, it wasn’t until late 2020 and 2021; the demand surged significantly for these digital collectibles. The secondary market value for CryptoPunks shot through the roof, resulting in multi-million-dollar NFT sales with auctions at Christie’s and Sotheby’s and a significant number of CryptoPunks used as Twitter profiles. 

Yuga Labs’ Acquisition Of CryptoPunks 

In early March, Larva Labs sold the CryptoPunks and Meebits NFT IP to the creators of the Bored Ape Yacht CLub, Yuga Labs. After the announcement, the demand for these digital collectibles skyrocketed.

According to the data from CryptoSlam, the secondary market sales of the Ethereum NFT collection reached $18.8 million, a significant rise of 1,219% in the span of just 24-hours.

How To Buy CryptoPunks? 

Although it is possible to view the complete collection of CryptoPunks, the world’s leading NFT marketplace, the collectibles can only be purchased from Larva Labs’ website. 

First, you will have to log in with an Ethereum crypto wallet like MetaMask, and then you can bid on, buy and sell CryptoPunks through the official site. Larva Labs also have an in-built tracker that lets you view the listed Punks in order of price, from low to high. 

The most expensive CryptoPunk was sold for $11.8 million worth of ETH in June 2021 in a Sotheby’s auction to the largest shareholder of DraftKings, Shalom Mackenzie.

What Does The Future Look Like For CryptoPunks?

CryptoPunks can generate great yields for investors who purchased the collectibles before the surge. 

That being said, it is not confirmed that the current demand for CryptoPunks will continue; however, the entry-level price for Punks is bound to increase. In early August 2021, the price floor reached $100,000 and just days later topped $150,000. 

In late August 2021, financial service giant Visa became the owner of a CryptoPunk, emphasizing the importance of NFTs in the future of social media, entertainment, commerce, and retail. It even called the NFT a “historic commerce artifact.”

Shortly after the announcement, the market for CryptoPunk shot up, creating a single-day record, with the sale of more than $101 million worth of the collection’s NFTs in a single day.

There is no doubt that CryptoPunks are in high demand; various profile picture NFT collections prove to be a great challenge for CryptoPunks. Bored Ape Yacht Club is its greatest challenger and has surpassed the floor price of CryptoPunks. 

Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.

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