In a sale of virtual land related to its highly anticipated Metaverse project, Bored Ape creator Yuga Labs raised the equivalent of USD320 million in cryptocurrency – the largest offering of its kind. Yuga Labs is the creator of the highly popular Bored Apes Yacht Club collection of NFTs.
The sale created demand strong enough to disrupt activity on the entire Ethereum blockchain and sent transaction fees soaring.
Ape Coin price rises ahead of sale
Otherside, the project’s planned Metaverse game, saw holders of the ApeCoin token jostling to buy deeds for 55,000 parcels of virtual land. Otherside is the latest extension of the Bored Ape franchise. The plots of land, NFTs called Otherdeeds, had generated enough interest to push up the price of ApeCoin ahead of the sale last week.
Each virtual plot of land cost the buyer approximately USD5,800, plus transaction fees (gas fees) in Ether. The transaction costs required to mint Otherdeed NFTs reached USD123 million after the launch, with each NFT requiring USD6,000 to mint. This was more than the price of the deed itself.
Jason Wu, founder of decentralised lending platform DeFiner said that the Yuga Labs’ virtual land sale caused one of the highest spikes in transaction fees he had ever seen.
Initially, Yuga Labs had planned for the sale in a Dutch Auction format, in which the price of the NFT would reduce over time to prevent congestion on the Ethereum blockchain, which would in turn cause high transaction fees. However, Yuga Labs decided against this option, and chose instead to cap the number of Otherdeeds that could be purchased per wallet. Yuga Labs later apologised on Twitter for causing congestion on the Ethereum blockchain, and suggested the possibility of starting an ApeCoin blockchain.
The ApeCoins raised in the sale of the virtual land will be locked up for one year, thereby reducing the number of coins in circulation. Spokespersons for Yuga Labs declined to say to whom the money raised would go to, and if large holders of ApeCoin like Andreessen Horowitz and Animoca Brands would participate in the land sale.
Aside from the 55,000 deeds sold, an extra 45,000 were allocated to holders of Bored Ape and Mutant Ape NFTs, and an additional 100,000 tokens were expected to be allocated to certain Otherdeed holders, according to the company website.
The frenzy around the land is in sharp contrast to much of the crypto market, which has been trading sideways in recent months, with Bitcoin down about 18 percent since the beginning of the year. Monthly sales volume on OpenSea, the world’s biggest NFT marketplace, were higher in April than in March, but still down from an all-time-high in January, according to data tracker Dune.
Metaverse software company Improbable will help to build the Otherside platform.
