Lots of cryptocurrency investors are jumping on the non-fungible token bandwagon and scooping up CryptoPunks for a lot of money. Even financial corporations have gotten into the game. Last August, Visa bought one of these NFT-based digital avatars for about $150,000 in ethereum. Keep reading to find out what CryptoPunks are and why they are so valuable.
What Are CryptoPunks?
CryptoPunks were one of the first collections of NFTs on the Ethereum blockchain. Think of these 10,000 avatars as a collection of digital art characters. Sparking the modern CryptoArt trend, each CryptoPunk is unique — meaning that no two characters are exactly alike.
How CryptoPunks Got Started
Larva Labs, a company created by Canadian self-proclaimed creative technologists Matt Hall and John Watkinson, created the CryptoPunks art project on the blockchain in New York. Global, multiplatform media and entertainment company Mashable predicted that CryptoPunks could change the way people think about digital art.
In 2017, the software developers, Hall and Watkinson, created a few lines of code, generating thousands of digital characters and a software program of marketable digital art that could be sold and owned. The result was a 10,000-piece collection of 24×24, 8-bit-style eccentric-looking pixel art images.
Inspired by the 1970s London punk movement, the CryptoPunk creators designed the digital characters as a collection of “misfits and nonconformists,” according to Hall and Watkinson.
How Do You Buy CryptoPunks?
The Ethereum technology platform is where digital currency, global payments and other digital applications take place. Ethereum calls itself a decentralized financial system and digital economic community where creators can earn, send, receive, borrow and stream funds worldwide.
Initially, anyone with an Ethereum wallet could claim CryptoPunks for free. All 10,000 characters were quickly claimed. Now, if you want to own one, you have to purchase it from an owner on the blockchain marketplace.
When you bid on, buy and sell CryptoPunks on the blockchain marketplace, you can see the status of each Punk based on the color of its background.
- A blue background indicates that a CryptoPunk is not for sale and does not have any bids at that time.
- A CryptoPunk with a red background symbolizes that the owner has placed it for sale.
- CryptoPunks with a purple background have an active bid on them.
3 Steps to Buying a CryptoPunk
Here’s how you can get a CryptoPunk for yourself:
- Download and install the MetaMask browser plugin for Chrome to access your Ethereum account.
- In the MetaMask plugin, buy some ether from Coinbase.
- Bid on, buy and sell CryptoPunks directly from the interface.
How Costly Are CryptoPunks?
Here is a list of some CryptoPunks that are currently for sale, as well as their accessories and current market status.
NFT industry data aggregator CryptoSlam states that Larva Labs’ overall transaction volume for the most recent year, its fourth in business, was $361.7 million. The price of CryptoPunks ranges from about $77,600 to $1.2 million in ethereum.
CryptoPunks positions can help diversify investors’ cryptocurrency portfolios. However, some investors use purchasing CryptoPunks as a gambling strategy. This pump-and-dump technique has been a cause of increasing sales prices of the digital artwork collectibles.
The Future of CryptoPunks
An NFT is a verified asset using blockchain technology. A computer network records transactions and proves the authenticity of buyers’ ownership of the tokens.
NFTs cannot be exchanged for other NFTs like bitcoin and other cryptocurrencies can. This restriction contributes to the scarcity of NFTs and increases their value. Some experts compare buying and collecting CryptoPunks to trading collectible items like cards and physical works of art.
Visa’s head of cryptocurrency predicts that NFTs, including CryptoPunks, will have an important part in the future of commerce, retail, entertainment and social media.
Who Owns the Most CryptoPunks?
A few celebrities and influencers have a monopoly on CryptoPunks ownership. Some of their names you may or may not recognize.
- Shawn “Jay-Z” Carter, American music producer, business mogul, rapper and songwriter, owns CryptoPunk 6095, which he bought for over $120,000 worth of ethereum. He uses this Punk as his Twitter profile photo.
- Electronic dance music artist Steve Aoki purchased CryptoPunk 6473 for 65 ethereum and sold it for 300 ethereum, worth over $900,000, shortly after, according to NFT Now.
- American entrepreneur Gary Vee owns 59 CryptoPunks, including Ape Punk 2140 and Zombie Punk 2424. He bought his Ape Punk for over $3.7 million, which, at the time, was the highest-selling Ape CryptoPunk to date.
Good To Know
CryptoPunks creators Hall and Watkinson sold nine CryptoPunks from their private collection last year at auction, through Christie’s. The lot went for nearly $17 million.
CryptoPunks investors like billionaire artist Jay-Z have brought more mainstream attention to NFTs. They lead the way in digital art investment as a way to generate wealth and be poised for financial freedom.