What are the Bored Ape NFTs?
The Bored Ape Yacht NFT, popularly called BAYC or Bored Ape NFTs, is a collection of 10,000 cartoon-like apes stored on the Ethereum blockchain. These NFTs are similar to physical artworks but exist only digitally.
They were launched in 2021 by Yuga Labs and have since increased in value. On the launch date, a Bored Ape NFT cost 0.08 ETH; by April 2022, the floor price for these NFTs was about 152 ETH. However, June 2023 saw the price of one ape in the valuable collection skid to 62 ETH, approximately $62,000. What led up to the downturn in the price of the NFTs began with the bearish turn of the crypto market and peaked with Jeffery Huang’s actions.
Events that led to the plunge
A Non-fungible token (NFT) denotes ownership of a digital art or asset. Next to CryptoPunks, Bored Ape NFTs are the most popular collection in the NFT space. The diversity of the cartoon-like apes in the collection, rarity, attributes, and celebrity endorsements also contribute to the dominance of Bored Apes.
Over the weekend, Jeffery Huang, also called Machi Big Brother, initiated sales of Bored Apes and followed it with several purchases from the collection. In a few days, he sold over 50 NFTs on the NFT marketplace, Blur. On Saturday alone, Huang purchased 19 apes at once, worth 651 ETH.
The series of moves done by Jeffery Huang, coupled with the market pressure on NFTs over the last few months, led to the plunge that the NFT collection is currently experiencing. The Bored Ape collection has been facing pressures, including lawsuits, US SEC probes on regulations, and questions bordering on copyright protection.
While the US SEC is investigating Yuga Labs on whether its operation violates federal laws, Yuga Labs filed a lawsuit against artist Ryder Ripps because he used the Yuga Labs trademark to promote his NFT collection. In addition, the SEC is also examining the ApeCoin, Bored Apes native tokens given to holders of BAYC NFTs. All these events and the flurry of sales activities by Machi resulted in the collection sinking to its lowest price point since November 2021.
The floor price for the popular NFT collection is approximately 36.4 ETH, which is about $68,000. Coming from the 152 ETH it was on in April 2022, this is a massive downturn for Bored Apes.
For a “blue-chip” NFT like Bored Apes, this plunge has raised concerns about the future of the Bored Ape NFTs. Some investors in digital art believe the floor price crash is an influence of the trading and lending volumes on the NFT marketplace, Blur, where the sales initiated by Machi happened.
Regardless of the pressures from SEC and the ongoing lawsuit, the co-founder of Bored Apes, Greg Solano, has assured the community members that efforts are being made to sustain the relevance of the NFT collection.