There’s nothing quite as punk in NFTs as owning a CryptoPunk. CryptoPunks may be the most critical NFT project there is. It is a status symbol, a piece of Internet history, and an unfathomably valuable asset. The rise of the CryptoPunks to non-fungible celebrities is entwined with the expansion of the Ethereum network. And the rise of multi-billion dollar enterprises like the Bored Ape Yacht Club can be easily linked back to the CryptoPunk mold.
So, for those of you thinking of purchasing a CryptoPunk — or just curious about what these strange photos are and why they cost millions of dollars — we chatted with notable NFT investor GMoney to get some answers.
We’ve compiled the definitive CryptoPunks guide based on these discussions. So let’s look at one of the most costly NFTs collections money can buy.
What are CryptoPunks?
CryptoPunks is one of the first NFT collections on the Ethereum blockchain, launched in June 2017 by by-product studio Larva Labs and bought by Yuga Labs in 2022.
It comprises 10,000 distinct 2424 pixel art pictures, the majority of which represent humans (male and female).
However, numerous additional distinct varieties are deemed more precious due to their scarcity. Zombies (88), apes (24), and aliens are among them (9).
Each CryptoPunk can also have a unique mix of 87 traits. Hats, pipes, necklaces, earrings, eyepatches, and other accessories are examples of “traits.”
A single CryptoPunk can only have a maximum of seven qualities. There is, however, just one CryptoPunk with seven traits: #Punk 8348. It wears a cigarette, an earring, a mole, buck teeth, vintage sunglasses, a top hat, and a large beard.
CryptoPunks can have zero qualities, although the majority have two or three. In the figure below, you can see how the number of features affects both the value and scarcity of a CryptoPunk NFT.
Who created CryptoPunks?
Unlike the more subsequent initiatives it influenced, CryptoPunks did not set out to build a community. The squad didn’t even have a road map. Matt Hall and John Watkinson, creators of Larva Labs in Canada, devised the concept as an experiment.
The NFT area was a long cry from the thriving market it is now at the time. As a result, CryptoPunks started slowly at first. The collection was launched in June 2017.
Initially, the NFTs were distributed for free to anybody who desired them. Because collecting one required an Ethereum wallet, supply was limited to individuals who had already invested in cryptocurrency.
“What makes CryptoPunks significant is that an organic community evolved around them,” GMoney says. “They have a history since they were one of the earliest NFT initiatives on Ethereum — and they were free to claim from the start.”
According to GMoney, early CryptoPunks supporters, such as now-top-tier NFT influencers Pranksy, DaveDave, and SeedPhrase, “realized earlier than others that digital ownership would be spreading more and more on-chain.” The ability to own and claim things on-chain was going to be extremely useful.”
Since 2017, CryptoPunks has evolved from a small, niche online craze to one of the world’s largest and most well-known NFT initiatives. While it was not the first NFT project on Ethereum, it was one of the first and unquestionably the most significant.
Many of those who were patient enough to hold have become multi-millionaires, and those who were fortunate enough to buy in before the 2021 frenzy are considered some of the most fortunate individuals in the NFT field.
How to buy a CryptoPunk NFT?
Those who are fresh to the NFT sector will undoubtedly come across CryptoPunks sooner or later. When they do, they’ll realize one thing: Punks are a very valuable asset.
Let’s look at the pricing in context:
Alien Punk #3100 was sold for 8 ETH on July 6th, 2017.
That was around $2,000 at the time. Back then, this would have sounded like an absurd sum to pay for a JPEG. Yet, over four years later, in March 2021, that same Punk sold for a whopping 4,200 ETH. This equates to $7.58 million.
Although this is one of the largest Punk sales to yet, such sales were far from rare during the 2021 CryptoPunk bull run. Punks went from selling for as little as 7 ETH to bursting towards the end of the year.
During this period, even the lowest accessible Punks were priced at around 100 ETH. Today, the most recent Punks sales are priced similarly, ranging between 60 and 100 ETH.
The most valuable CryptoPunks may fetch up to 150 ETH, although values have largely stabilized.
You may purchase one on the LarvaLabs website if you have enough cryptocurrency in your wallet.
Punks are also being sold in auction houses. So, if you keep a lookout, you might be able to get one on sale. Christie’s must be credited for helping to build the Punk market by exposing individuals in more traditional art environments to Punks.
Following up on its $69 million Beeple sales in March, Christie’s offered a collection of nine CryptoPunks in May, which sold for a stunning $16.9 million.
Why is CryptoPunks so expensive?
CryptoPunks have grown to be seen as both an investment and a prestige symbol over time. GMoney claims that he bought his CryptoPunk to gain the associated prestige.
“With an NFT, I can instantly ‘flex‘ with an image by sharing it as my avatar on Twitter and Discord… “It has the same impact as wearing that Rolex in person, but digitally,” he explained.
Punk 8219 bought for 140 ETH ($150,274.60 USD) by 0xf0d699 from 0x33eaae. https://t.co/FZvhFN16zU #cryptopunks #ethereum pic.twitter.com/VBU9u9D1gI
— CryptoPunks Bot (@cryptopunksbot) January 6, 2021
People in the NFT community regard the owners of CryptoPunks as builders and visionaries. They are considered, rightly or incorrectly, as those who predicted where NFTs would go and got in ahead of the curve.
As a result, they are presumed to have trust and prestige. Indeed, many collectors have built whole egos, initiatives, groups, and companies around a single CryptoPunk NFT.
Furthermore, given their history and how they matured and expanded with the Ethereum blockchain from the beginning, some say that holding a Punk is like betting on the relevance of NFTs and the Ethereum network.
The majority of Punks’ early supporters did not come upon the initiative by coincidence. “You have to be around in crypto early on to get engaged with CryptoPunks,” GMoney put it.
In short, the project is highly valuable because of its historical relevance and the way it shows a conviction in Ethereum.
Regardless of the social-to-financial value ratio, celebrities, venture capitalists, and even hedge funds have flocked to the CryptoPunks race in droves.
After everything is said and done, it’s difficult to dismiss a project that transformed collectors into billionaires almost overnight.
As a result, the collection is still valuable today, thanks in part to the early collectors’ success. Everyone is looking for a repeat performance.
While Punks is one of the best NFT projects of all time, the crew behind it is not without criticism. Larva Labs received outrage in February 2022 after one of its co-founders, John Watkinson, sold off his ownership in V1 CryptoPunks NFTs.
Larva Labs sought to blacklist the fledgling project and get it removed from NFT markets just days after selling the V1 Punks. This denunciation had the potential to drive down the price of V1 Punks, resulting in a financial loss for everyone who purchased NFTs from Watkinson.
Meanwhile, Watkinson kept all of the money from his sales and would experience no losses from the price reduction, which was triggered by a corporation he and one other person owned.
The community was divided on whether or not what Larva Labs did was wrong. Some contended that the organization was not deserving of criticism because the team explicitly declared that they did not approve of the idea and planned to sell it.
Others criticized the firm for just condemning the initiative and stating that they were selling two days after the cofounder had already sold…which isn’t exactly truthful.
That wasn’t the only time the corporation was chastised by the NFT community.
Larva Labs has also attracted criticism for purportedly assaulting legitimate initiatives that aren’t out to defraud people, as well as for neglecting to define what Intellectual Property (IP) rights customers have regarding the CryptoPunk NFT they hold.
CryptoPunks acquisition by Yuga Labs
Yuga Labs, the creator of Bored Ape Yacht Club, bought both CryptoPunks and Meebits in March 2022. Yuga Labs states that with this acquisition, they hope to cultivate a “community of builders” who will create derivative works based on the two projects.
Yuga Labs claimed that they will transfer IP, commercial, and exclusive license rights to individual NFT holders to do this, as they did with their BASIC collection.
Owners of CryptoPunks and Meebits will be able to produce artwork and items based on their NFTs in the same manner as BAYC owners have.
In essence, this transaction addressed one of the primary issues, since customers were finally informed of their rights in connection to their CryptoPunk NFT.
The CryptoPunk developers stated in a statement that they went forward with the acquisition because they believed Yuga Labs would be better custodians of their projects. “Yuga Labs are the greatest at what they do in the world, and they are the appropriate caretakers of the CryptoPunks and Meebits.”
We are convinced that in their hands, they will continue to be crucial, vibrant initiatives in the burgeoning decentralized web,” they stated.
Given the hostility they received when they controlled CryptoPunks, Hall and Watkinson may be accurate.
Yuga Labs also received 423 CryptoPunks and 1711 Meebits as part of the purchase. “We’re not in a hurry to do anything but give people their IP, watch what they develop, and listen,” Yuga Labs stated when asked what they plan to do with them.
The future of CryptoPunks
CryptoPunks is a legacy project in the NFT sector despite being only a few years old. GMoney observes that, despite the rapid growth of the NFT area, Punks will not be lost or forgotten.
Why? Because they are the origins of everything. “CryptoPunks will remain a major component of the NFT community.” “They don’t need to change, and nothing needs to happen for them to be remembered,” he remarked.
Punks will almost certainly alter with a new owner. Yuga Labs now receives a portion every time a Bored Ape is resold. Larva Labs, on the other hand, did not do so with CryptoPunks and Meebits. Yuga Labs claims they have no plans to modify that, but they haven’t made any statements about what they intend to do with the data.
Prices continue to swing drastically as the world waits to see what Yuga Labs does with CryptoPunks. In October of 2021, CryptoPunk #273 was acquired for around $1.03 million. It was sold for a significant loss six months later, in May 2022.
It was bought for $139,000. As a result, it appears that Yuga Labs may struggle to generate a return on its investment.
Whatever happens, given that the NFT community is sometimes seen as a passing craze, it seems fitting that the space’s mascot is a Punk.