Crypto is often touted as the great equalizer, a more egalitarian way of investing and buying things. But the launch of Bored Ape Yacht Club–linked cryptocurrency ApeCoin last week showed something different: The biggest winners were major companies and people who are already heavily invested in the crypto space.
Bored Ape Yacht Club is a collection of 10,000 NFTs, or non-fungible tokens, created by Yuga Labs that feature apes with varying characteristics like different fur color, accessories, or background color. Last week, a decentralized autonomous organization called ApeCoin DAO released ApeCoin crypto tokens featuring the Bored Ape Yacht Club logo.
People can now buy ApeCoins on crypto exchanges like Binance and Coinbase. ApeCoins, which were trading up 24% at $12.32 on Tuesday, reached a high of $17.75 the day after the crypto’s launch, which gave some investors a window to net a tidy profit, depending on their timing. The catch: Those who already owned Bored Apes benefited the most.
Each Bored Ape owner was given 10,094 “free” tokens, worth about $111,904 as of Tuesday, and each Mutant Ape owner was given 2,042 tokens, worth about $21,971, according to the ApeCoin website. And although the entire collection contains 10,000 NFTs, about 6,362 wallets own them. According to data from DappRadar, 532 wallets own more than two Bored Apes, and at least five wallets own more than 50 Bored Apes.
Of the 1 billion tokens created that week (some of which are locked, to be released later) existing Bored Ape and Mutant Ape holders received 15%, or 150 million tokens, worth a cumulative $1.8 billion as of Tuesday. Andreessen Horowitz, Animoca Brands, and other partners that helped with the ApeCoin launch received 14% of the total airdropped tokens, worth about $1.7 billion as of Tuesday.
Bored Ape NFTs are becoming synonymous with crypto wealth and exclusivity, so much so that Ethereum founder Vitalik Buterin called them out specifically in a recent interview with Time, during which he said NFT speculation involved “lots of people that are just buying yachts and Lambos.”
“[U]ltimately the goal of crypto is not to play games with million-dollar pictures of monkeys, it’s to do things that accomplish meaningful effects in the real world,” he said.
A spokesperson for Yuga Labs said in a statement to Coins2Day that ApeCoin is a governance and utility token and it made sense to airdrop the tokens to the community to ensure the currency, through its DAO, is community controlled.
“The Bored Ape Yacht Club launched under a year ago, and the cost to mint a Bored Ape was ~$220. Many BAYC members are teachers, writers, and regular folks,” the spokesperson wrote in a statement.
Bored Apes are already worth a minimum of 101 Ether, or about $303,960, according to NFT exchange OpenSea. And through the airdrop, existing Bored Ape NFT owners essentially got an asset potentially worth tens of thousands to millions of dollars for free, minus any gas fees charged by the Ethereum network.
A lot owned by a few
Like more traditional economies, wealth in the crypto space is often consolidated among a small group of players.
Last December the Wall Street Journal reported that 0.01% of Bitcoin holders controlled 27% of the 19 million tokens in circulation.
The trend extends to NFTs.
When NFTs jumped into the mainstream last year, especially after Beeple sold a piece of NFT artwork for $69 million, the prices of the most famous NFT collections skyrocketed.
Early adopters who quickly minted some of the first NFTs, or bought several NFTs when they were relatively cheap, have seen their investments increase substantially. For a short time in April 2021, Bored Ape NFTs could be minted for 0.08 Ether, or about $235 at the time. Today they’ve increased 100,000% in value based on the minimum Bored Ape price of $277,000.
But as prices for the top 10 NFTs jump into the six figures and beyond, the digital collectibles are now out of reach for the common investor. As of Tuesday, the lowest prices for one NFT in the top five collections, according to CoinMarketCap, were in the tens of thousands of dollars or higher. This includes both Bored Apes and Mutant Apes, along with the Azuki and CryptoPunks collections.
Correction, March 23, 2022: A previous version of this article misstated the number of coins airdropped to existing Bored Ape NFT holders.
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