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What are CryptoPunks?

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What's behind the value of CryptoPunks?

Many observers have been puzzled by the prices collectors are paying for CryptoPunks recently, arguing that a speculative bubble has formed. While others believe that the value of CryptoPunks is driven by factors beyond the hype of NFTs, the recent trend may just be the beginning of a wave of revolution in art collecting.

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Fundamental Drivers Behind CryptoPunks Valuation

The Narrative of the First NFT Project in History

The first fundamental driver behind CryptoPunks valuation is its narrative as the first NFT project in history. And this statement makes CryptoPunks the only collectible in the NFT field.

But what exactly does it mean to be the first NFT project? This means it is the first project to use blockchain technology to represent ownership of unique assets and has three groundbreaking effects.

First, CryptoPunks have revolutionized art and the art market. By utilizing the blockchain's proof-of-ownership technology, CryptoPunks has eliminated third parties from the art trade. Artists can now interact directly with their audiences to buy and sell their work. The application of blockchain technology in art in particular has made digital art and collectibles scarce in the digital world, as their reproducibility once prevented them from existing in a rare and valuable way.

Second, the pattern set by CryptoPunks has led to the emergence of a new asset class more generally: NFTs. While works of art are one use case, there are other non-fungible assets (jpegs, memes, certificates, patents, etc.) that use proof-of-ownership techniques to become scarce and valuable.

scarcity

scarcity

Not only are CryptoPunks culturally significant in the NFT space, but they are also scarce. They wouldn't be valuable without a 10K cap, making them hard to get.

It's worth noting that CryptoPunks are not only scarce at the collectible level, but also within themselves, as some punks are considered more scarce than others.

The value of punk depends on its genre, number of attributes, combination of attributes and subjectivity. There are 5 types of punks (Alien, Zombie, Ape, Male, Female) with 87 different attributes, and each punk has a maximum of 7 attributes.

Generally, the types considered more valuable are aliens, zombies, and apes. In fact, the average price of an alien can be up to 16 times the average price of a male punk.

In terms of stats, punks with 0, 6 or 7 stats are generally considered more valuable.

The most sought-after attributes tend to be those that are most eccentric and punk-like. Currently, the highest average prices are as follows:

• hoodie

• pilot helmet

• hoodie

• headgear

• collar

• top hat

• welding goggles

• 3D glasses

• welding goggles

• Gold chain

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Value of Top10 features over time

As the chart above shows, some features that weren’t particularly in demand, such as hoodies and aviator helmets, are seeing renewed interest. Therefore, it is important to keep up with discussions in the CryptoPunks community (Discord, Twitter, etc.) related to the feature, using recent sales history as a reference.

Social currency within the OG community

As mentioned above, CryptoPunks have a unique narrative and a limited supply. This scarcity is met with demand, which comes from the fact that CryptoPunks constitute a social currency within the OG community and the NFT space.

Increased demand for OG and entry of new market players will drive up prices

Increased demand for OG and entry of new market players will drive up prices

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Top 5 Holders of CryptoPunks

Moreover, looking at the evolution of transactions by different types of NFT collectors over time also shows that,"Legendary NFT Collector"image description

Types of NFT Collectors Buying CryptoPunks Over Time

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Total number of unique addresses owning CryptoPunks over time

Among these new entrants have been high net worth individuals, investors, celebrities and influencers. We can expect that they are already motivated by short/long term profits, as well as the social currency associated with CryptoPunks.

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The overall growth of the NFT market strengthens Cryptopunks’ position as a first of its kind

Along with other successful collectibles such as Autoglyphs, Bored Ape Yacht Club and ArtBlocks, and tracing its origins back to CryptoPunks, CryptoPunks will be appreciated.

As the NFT space matures and merges with Metaverse, VR and AR, CryptoPunks will become part of a larger market and gain utility.

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CryptoPunks have become a store of value

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in conclusion

In conclusion, the meteoric rise in the value of CryptoPunks can be explained by fundamental drivers such as its narrative as the first NFT project in history, scarcity and associated social currency. The aforementioned elements will continue to drive the value of CryptoPunks to extraordinary heights. While we can expect some short-term volatility, mirroring the ups and downs of the cryptocurrency space, in the long-term, the value of CryptoPunks has only one direction. CryptoPunks will go on to become one of the most established collections of blue-chip NFTs.

This article comes from Tao of Yuan Universe, reproduced with authorization.

This article comes from Tao of Yuan Universe, reproduced with authorization.