Mama Mia
(Any views expressed in the below are the personal views of the author and should not form the basis for making investment decisions, nor be construed as a recommendation or advice to engage in investment transactions.)
Gm everyone. Welcome back and what a week it has been. We’ve seen quite the revival in crypto over the last week, with thousands of people running and jumping around in the Otherside demo, Pudgy Penguins 2x’ing off the bottom in a major comeback, and the Saudis max bidding ETH over $1500 😂. A lot to discuss so we’ll keep this short. Let’s have another great week!
Important Updates
Cacio e Pepe will be dropping on Joepegs on Tuesday July 26th. This will be on AVAX. Please fill this out to enter the WL Raffle. We will announce the winners later via our twitter this week.
Mint Jobs: As we build out the best web3 job board on the internet, we're going to start highlighting ONLY a couple of the most interesting roles each week in the newsletter. This week, we want to flag a Data Analyst position at Looks Rare. This role is excellent for people of all experience levels but who have experience with SQL, Python, and advanced excel skills. LooksRare is an awesome company that has disrupted OpenSea’s monopoly on NFT trading and we think they're sticking around for a while. If you have data skills and want to make a jump to Web3, this role is for you!
NFTs In The News
Pudgy Toys: IP Utility and PMI Partnership
Disney Chooses Polygon for Accelerator Program
Magic Eden launches venture unit to invest in web3 gaming startups
Christie's launches venture fund, makes first investment in web3 company
GameStop NFT Marketplace Already Boasts Higher Sales than Coinbase NFT in First Two Days
Crypto gaming firm Animoca Brands hits $5.5 billion valuation after $75 million fundraise
You’ve Been Served Via NFT: Court Gives OK to Sue on Blockchain
Macro Overview
Commence the pump (at the time of writing ofcourse). In what feels like an eternity, the vibe as seemed to flip partially bullish. While everything still feels extremely quiet, if you peel back the layers, some interesting things are afoot. Punks are back at 80 ETH (hit 40 ETH) and various Art Blocks collections have been pumping. At the same time, ETH has made its way back above $1,500 and there is early chatter circulating around the idea that the market may have bottomed out (FWIW we don’t know if it has).
Things certainly look better, and week-over-week the sentiment is getting increasingly positive. If we look closely we can also see that we’re in our 4th week of an up trend. Still, the overall ETH volume in NFTs is looking relatively flat for the last 2 months. That being said, we have had no shortage of “micro-narratives” throughout the NFT space.
Looking at the chart below, we can see that it’s similar to the OpenSea all time high of last week. Transactions floating around the ATH means that the degen mint meta is still alive and well. It feels like we’re repeating ourselves at this point but it’s another week of blue chips being flat/up, and degen/free mints pumping and dumping quickly. Love it or hate it, the gamblers in the casino are what’s keeping us all alive right now, buying time as the innovation taking place behind the scenes slowly materializes. If you want to see what we mean, check out this low key NFT drop that Nikelodeon is doing later that seemed to slip under a lot of CT’s radar.
Moving on, paid new and recent mints also continue to struggle. This is probably the toughest part of the market right now and if you’re new to NFTs, this doesn’t make much sense. The Possessed is down under .2 ETH compared to pump-dump-hype-meme projects like the The Saudis which have somehow managed to sustain a notable floor price.
Projects building for months struggling to mint out or stay above mint price, while free mints moon is not what you want to see when assessing overall market health. However, for those that have been here for a while, one fundamental, undeniable truth is that memes continue to cement themselves as currency in a hype-driven market.
Bad Influence
Speaking of new mints, we have Bad Influence back on our radar. If you remember, this was a project with decent hype back in March/April. We’ll include this in the macro because the team is doing something we haven’t seen before.
They’re giving their WL holders a free mint window. Not only this, but they are only minting a certain percentage of the supply, and will be auctioning off 1 NFT per day until the entire project mints out - the equivalent of 10 years (similar to what Nouns does). Whether this strategy works or not, we expect more projects to take inspiration here, and develop other innovative ways to structure their minting process to accommodate these uncertain macro conditions. At the very least, it’s encouraging to see teams remaining agile/dynamic, and rewarding long-time community members.
Mid-Cap: Bad-Cap
Moving on, let’s revisit our favorite topic – 99% of projects are going to 0 😂. The main *concern* for most (depending what you hold) is that mid-caps continue to trend down. If you want to see quite a sad sight, check out the top 100 all-time overall volume on OpenSea. Toward the bottom you can find a lot of the mid-caps or old “blue-chip” hopefuls which many discussed during the bull market (including ourselves). Projects the size of Coolmans, Deadfellaz, Ragnarok, The Doge Pound, and Alien Frens are all floating at the 90 day low and have seen little to no relief from this market bounce. No opinion on any of these projects, merely an observation of mid-caps continuing to get crushed.
What we get from this (we know we’ve been repeating ourselves but this thought increasingly solidifies week-by-week) is that in this market you want to buy the highest quality possible, or be a degen flipper (picture the bell curve meme – do not fall in the middle). Buying projects with “potential” isn’t working out right now. Buying projects that had hype but are down 90% from their ATH (and feeling like you’re buying low) is also the wrong approach (in our opinion, NFA).
Avax NFTs
After seeing over 850+ people attend the Joepegs spaces yesterday for free mint Monday, it only makes sense that we continue to cover this area of the market. We still think it’s not talked about enough, and have been impressed with how smooth everything has been running, hence our decision to move Cacio e Pepe from ETH to AVAX.
If you were able to mint Smol Apa yesterday for free, well congrats, as the floor is now $1400 USD basically 12 hours later. This is too much to ignore. If you minted the “Smol Redacted APA” below, you would have been able to realize a quick $2000 USD profit. However, it isn’t all free money. While we saw Chad Doge mint out a 3250 collection in under 1 minute at a 1 AVAX price, Friend Forest was the first new mint on Joepegs that struggled. Whether the price was too high, or people didn’t like the art, the project still hasn’t minted out 20% from earlier in the week.
There is practically going to be a new mint on Joepegs every day for the next month. Some will do well and some won’t. Moo World tomorrow may be a decent sign of whats to come – a smaller collection than the previous 2 mentioned and a modest 1 AVAX price (read $25 USD). If you’re new here and overly excited about the new “meta” that we’ve been discussing, the recent mishap with Friend Forest shows that prudent risk management is still crucial on every single chain.
The overall AVAX NFT volume continues to trend up here and new members are certainly buying into existing collections. If you are paying attention, we think there will be more free mints that pop up throughout the week/month, and will be mentioning them on Twitter as they arise.
Conclusion
While we’re not out of the mud yet, things certainly are looking better than before. Whether this is a relief bounce before we head deeper into the darkness or we’re beginning the slow climb out from the bottom is unknown. Opportunity is everywhere but it still doesn’t feel like the time to get out to the right side of the risk curve yet with all of the uncertainty due to 3AC unwinding and the global macro environment.
Most importantly, stay alive. This includes being smart and cautious about where you connect your wallet and clicking on suspicious links. We *will* be mainstream in the future but we aren’t there yet, and until we are new scams will become more and more complex.
If you’ve made it this far, we’re confident that you haven’t blown yourself up yet. Stay vigilant, and more importantly stay hungry for knowledge. We’ve all been rugged before and mistakes have been made, but these are arguably necessary growing pains to put you on a path toward excellence. The future for us JPEG enthusiasts is quite bright.
Keep your head up anon,
W & P