Bored Ape Yacht Club is a huge mainstream hit, but is Wall Street ready for NFTs?

Within months after its launch in April 2021, Bored Ape Yacht Club (BAYC) has become one of the main reasons Wall Street is taking the non-fungible token (NFT) market seriously, thanks to its recent sales of over $1 billion.

Celebrity monkey in BAYC

For starters, BAYC is a collection of 10,000 cartoon anthropomorphic monkeys with stylish clothes and infamous expressions. Virtually every monkey is an image file that should be worthless in a sane world. However, they have managed to fetch staggering amounts, sometimes from some of the world’s most famous celebrities.

For example, Jimmy Fallon, a popular American TV presenter, bought a picture of a bored monkey wearing a striped T-shirt and heart-shaped shades for about $220,000 in November last year. And very recently, Academy Award-winning rapper Eminem paid nearly $462,000 for a monkey that looks somewhat like him.

Eminem’s bored monkey, dubbed BAYC #9055. Source: The Guardian

Meanwhile, one of the rarest bored monkeys, who had the traits of golden fur, fetched $3.4 million at an online auction held by Sotheby’s in October, breaking the record for another rare monkey with laser eyes, which was sold to Sandbox for $2.9 million. A month ago.

But what is the selling point?

The BAYC Group derives its value from NFTs, digital evidence of ownership registered on the public blockchain. Think of Bitcoin (BTC), but every “currency” is indivisible and unique in some way.

Meanwhile, most of the NFT projects, including BAYC, are settling on the Ethereum blockchain, at the price of the native token Ether (ETH).

But scarcity isn’t the only reason people pay millions of dollars to buy boring monkeys. In addition to having a unique avatar, people also gain admission to an exclusive membership club, which is enforced using tokens. This gives them entry into an inner circle of elites, giving them prestige and more profitable opportunities.

Evan Luthra, CEO and founder of EL Group International and exclusive BAYC Club member discussed the allure associated with the Elite League. The 26-year-old angel investor referred to membership as something “very strong for the people of Wall Street.”

“I think there’s a new celebrity joining the club every day.”

Bored Monkey collectibles also enable their owners to enter private message boards on Discord and gain privileged access to other NFTs.

Bored Ape Yacht Club

Bored Monkey collectibles also enable their owners to enter private message boards on Discord and gain privileged access to other NFTs. And then there is a certain resale value associated with these deals, as evidenced by the high “floor price,” which reflects the lowest bid one can open for collectibles.

As of January 7, the floor price on BAYC was 68 ETH, or about $217,800, up 380% from its low in mid-August.

BAYC floor price chart. Source: CoinGecko

Noel Acheson, Head of Market Insights at Genesis Trading, attributed BAYC to being more flexible in collaborating than CryptoPunks, one of the only high-profile NFT chains to come before it.

These collaborations include adidas-inspired BAYC gear, a talent agency signature, potential Bored Ape music group, and other related assets emerging around vulnerable ape personalities.

“So the concept of minimum rates – which drives institutional investment in NFTs as well as their increased use as collateral for loans – is no longer based solely on how much investors think someone else will pay more in the future,” Acheson explained, adding:

“The minimum prices and the potential for an asset to rise now also depends on what other things NFTs can be used for, other than just supply.”

Luthra agreed, adding that the continued involvement of celebrities with BAYC would enhance its recognition among individual and institutional investors alike. This may increase demand for its NFT set, which in turn will push the lower price up.

“dead” factor

Jelmer Rotteveel, co-founder of NFT group MoonwalkerFM, attached another bullish pillar to BAYC’s core assessment: the ongoing hype around Meta, which has been rebranded from Facebook to support the social media giant’s ambitions.

“With the advent of Meta, we will enter a new way of communicating and doing business,” he told Cointelegraph, adding that NFTs will become an integral part of the metaverse sector, where users support unique digital avatars, such as Bored Apes, to interact with each other digitally.

he added:

“I think people will look closely at the developments of NFT projects like BAYC, and as you have seen with cryptocurrencies, they will step in one by one.”

Acheson noted that Facebook/Meta has committed to spending nearly $10 billion on developing the metaverse, citing CEO Mark Zuckerberg’s statement that they will look into metaverse decentralized applications.

“Whether we believe it or not – investors are likely to consider preempting those inflows,” she added.

Will Wall Street Join the NFTs?

As mentioned, BAYC net sales recently crossed the $1 billion mark, nearly 10% of what Apple achieved in 2021. Meanwhile, the NFT segment, on the whole, processed $41 billion in sales, which is roughly equal to sales Global Art Sales Year, Data from Chainalysis . showed

Matt Hogan, chief investment officer at Bitwise Asset Management, admitted that many of their clients were looking to emerge in the NFT space without having to go through its formidable technology.

In response, Bitwise recently launched a dedicated fund, which tracks its Bitwise Blue-Chip NFT pools index — a basket of the ten largest NFT pools weighted by market capitalization — and buys and holds artwork from BAYC, CryptoPunks and other NFT projects.

Related: The world of NFT is gradually bridging the gap between the specialized and the general

The Blue-Chip NFT Index Fund is only available to institutional investors who have invested at least $25,000 in the product.

The returns that Bitwise’s NFT fund has brought in since the beginning. Source: Bitwise Asset Management

Rebekah Keida, director of marketing at New York-based investment management firm XBTO, favored the prospect of including premium NFT projects such as BAYC or CryptoPunks into funds on Wall Street.

Keida says it will open the door for accredited investors to pour thousands, even millions of dollars into these digital ventures.

“The opportunities presented by the increased capital inflow enhance the legitimacy of the best NFT projects while allowing investors to bet diversified in cryptocurrencies,” she told Cointelegraph.

Luthra demonstrated confidence in asset managers’ ability to transform Meta into the metaverse segment, which in turn will benefit NFT projects such as BAYC, saying:

“If Meta believes that the future lies in the metaverse and this is where they are investing their time and energy, it only makes sense for asset managers to spread money into the industry. As the space matures and more opportunities become available, I am confident we will see more metaverse related funds emerge to take advantage of of this opportunity.”

Meanwhile, Cross the Age metaverse CEO Sami Shlago compared Meta’s potential involvement in the NFT space to “lighting a lamp in the heads of investors who are even more backward about the concept.”

“Whether you think Meta’s decision is good or bad, the fact remains that when one of the largest social networking groups open to innovation and known to disrupt our environment talks about a topic, it opens doors and a desire to get involved.”

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