The Secret Digital Currency the Bored Ape Creators Are Really Selling

The Secret Digital Currency the Bored Ape Creators Are Really Selling

Crypto Gandalf

April 16, 2022


Yuga Labs, the creators of the Bored Ape Yacht Club, just raised $450 million at a $4 billion dollar valuation in a round lead by Web3’s 2 biggest fan boys, Andreason and Horrowitz. For perspective, 4 billion dollars is the same valuation Disney gave Star Wars and Marvel when they were acquired. That is roughly the market cap of NordstromMark Cuban’s net worth, and not far from the valuation on the Series D of a slightly overvalued startup called WeWork.

This raise is the cherry on top of a March already filled with madness for the company. Earlier this months, the company acquired the IP for CryptoPunks (the most valuable NFT collection by value traded) and Meebits from Larva Labs for an undisclosed sum of money. Even if that sum was a few hundred million, they quickly recouped the funds a couple weeks later by launching their own new cryptocurrency called ApeCoin.

WTF is ApeCoin?

Besides a terrifying personification of late stage of capitalism? ApeCoin is a new coin launched on top of Ethereum. According to the creators, ApeCoin servers 4 main purposes “Governance” (of ApeCoin DAO not the actual company Yuga Labs), “Unification of Spends” (because what we need is one more cryptocurrency), “Access” (you can only get onto the yacht if you own a piece of the digital scarcity they created), and “Incentivisation” (Get more people in the ecosystem, so the ecosystem becomes more valuable).

Yuga Labs actually missed marketing the 5th and most important purpose of ApeCoin: A thing that is worth a shit ton of money. If there is one product members of the yacht club love, it is a new financial asset to speculate on. They’ve built a product more perfectly suited for their customers than Steve Jobs ever did.

So far ApeCoin has really made good on this 5th purpose. A single ApeCoin, hit a high of $40 per coin before settling back down to $15 at the time of this writing. With a billion coins set aside for eventual circulation, the sudo IPO of ApeCoin DAO is currently worth a casual $15 billion dollars. Yuga Labs managed to set aside 34% of that supply for the company, its founders and powerful friends, suggesting their messaging around decentralization holds about as much weight as Exon’s commitment to fight Climate Change.

A Gargantuan Funding Round

What do you do when can’t be caught dumping millions of dollars worth of ApeCoin onto the market (yet), but you also would like to have $450 million US dollars in your pocket? Apparently you can call Andreason Horowitz and raise at a 4 billion dollar valuation. What else would an online art project do with 47 guaczillion dollars in funding besides get to work on building the metaverse. Otherside, Yuga’s vision of Ready Player One, sounds like decentralized version of World of Warcraft based around NFTs. Between ApeCoin and a massive influx of VC capital, what started as a 10,000 profile picture niche NFT project, somehow convinced the world its intellectual property and future are worth almost $20 billion dollars.

The Real Digital Currency Yuga is Selling

Web3 doesn’t run on Bitcoin, Ethereum, or Solana. Web3 runs on a much older digital currency: Attention. It’s the same currency Web 2 runs on with a new class of customers and far more potential for monetization. Yuga Labs’ valuation is turbo charged by a constant spotlight and our utter inability to stop talking about NFTs. Every midwit with a medium account, including me, can’t resist writing an article about this whole story.

Like Jake Paul, they’ve captured the imaginations of their subscribers, and the contempt of their detractors. The Bored Apes have the audience’s attention, but unlike Google and the rest of Web2, they aren’t selling it to advertisers. They are selling it back to the audience, a novel phenomenon which tends to attract attention, only growing the supply. The virtuous/vicious cycle continues.

The audience members will pay for this bottled up attention because more eye balls means more demand, which combined with a fixed supply means rising jpeg valuations. Other buyers, less interested in flipping, buy for a byproduct of attention, clout– which can now only be achieved by a hexagonal twitter avi. It turns out, this new pool of customers, has more demand and less price sensitivity than advertisers.

A Captive Customer Base

It is difficult to get a man to understand something when his salary depends upon his not understanding it.

-Upton Sinclair

ApeCoin and OthersideLand mark the 4th and 5th major spinoffs BAYC IP within the last year. Disney couldn’t pump out that much quantity over quality even in the MCU, without attracting the ire of fans claiming they are milking the franchise dry. So shouldn’t we have all gotten sick of this Ape Flavored Internet Mania by now?

No and the ApeCoin holders never will, because Yuga Labs doesn’t directly sell their fans anything anymore. They just keep creating products for history’s largest army of hype beasts to spread the word about. They give some share away to disciples and hold onto the rest to experience the upside for themselves.

The only thing that could possibly bring this whole thing crashing down this point, is the second all of us non-ApeCoin holders get bored of watching.

Originally published by Trevor Adcock originally on BlockMagnates community.

Image Source


Crypto Gandalf

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