In-depth Analysis of BAYC: A Logical System Beyond the Value of Digital Collectibles Themselves

This article is sourced from Planet Daily

To begin with: Nowadays, the price of NFTs is no longer the only way to assess and measure their value. Sometimes, building a unique system that allows Super Fans or Club Members to engage deeply can far exceed the value of the digital collectibles themselves.

In the past month of the NFT market, the Bored Ape Yacht Club (hereinafter referred to as BAYC) has undoubtedly been the dark horse. In June, BAYC's total sales reached $39.71 million, with a total sales volume of 2,810, surpassing star projects like NBA Top Shot, CryptoPunks, and Meebits.

This collection of ape-themed collectibles and the BAYC club is sweeping the NFT world. First, what is BAYC?

BAYC stands for Bored Ape Yacht Club, a collection consisting of 10,000 ape NFTs, featuring 170 different attributes with varying rarity, including hats, eyes, expressions, clothing, and backgrounds. These 10,000 unique apes were randomly generated through programming, each with distinct expressions and outfits.

Reasons for Its Rise

BAYC began its sale on April 23. Initially, it did not receive much attention until May 1, when well-known collector Pranksy took notice of the project and announced that he had purchased over 250 apes. From the moment he tweeted, BAYC's sales, users, and transaction numbers surged. Within just 117 minutes, BAYC sold out. According to the BAYC team, they had never communicated privately with Pranksy.

Clever Narrative

The story behind BAYC resonates with many NFT collectors: investors in the digital realm have realized their dreams of financial freedom through NFTs. BAYC adopted a fair launch (FL) model for its initial sale, with each ape priced at 0.08 ETH. This provided a low entry cost, allowing all users to start from the same starting line without worrying about investment firms or whales having an absolute advantage. This fair and just approach attracted many investors.

Horizontal Comparison

This contrasts with the Meebits launched by Larva Labs. Meebits are algorithmically generated 3D voxel characters, visually similar to Minecraft avatars. Meebits were created by Larva Labs in May, a team that previously launched the well-known NFT collections CryptoPunks and Autoglyphs. The brand influence of Larva Labs and its built-in spotlight effect paved the way for the launch of Meebits. However, the prices of Meebits are very high; out of a total of 20,000 Meebits, 9,000 were publicly sold through a Dutch auction starting at 2.5 ETH. The remaining 11,000 were rewards for collectors who already owned CryptoPunks and Autoglyphs, allowing each CryptoPunk and Autoglyph to mint one Meebit for free.

Thus, this reward mechanism is top-down, with the participation of CryptoPunk and Autoglyph collectors igniting the Meebits craze. At the same time, this mechanism conveys a message—that collectors will be rewarded for holding NFTs issued by Larva Labs.

Meebits were offered for free to CryptoPunks collectors while charging others an entry fee of 2.5 ETH. This made wealthy collectors even richer. Currently, CryptoPunks are not cheap; according to data from the Larva Labs market, the cheapest Punk is priced at around 17.5 ETH (approximately $38,500 at the time of writing). For others, the initial price was already very high. This feels more like a reward for CryptoPunk holders rather than something prepared for new collectors.

One targets well-funded NFT collectors, while the other is a new space for beginners.

According to data from July on Opensea, BAYC's secondary market price is rising, with the current floor price for BAYC at 2.52 ETH and Meebits at 1.05 ETH. On June 1, a BAYC sold for 49.99 ETH, yielding a return of 62,500%. Although this price is still lower than the highest price paid for Meebits, which was 303 ETH.

Community Atmosphere + Social Capital

The rapid development of BAYC cannot be separated from the role of the community. Since its launch in April, the BAYC project has quickly grown into a large community. For BAYC holders, it is not just a collection but a club. According to a BAYC user, Ong, "The Bored Ape Yacht Club is like a college club where everyone connects with each other, and people set their social media avatars as apes, following each other and creating a trend of 'Ape follow Ape.'"

Celebrity Effect

First, there is the celebrity effect. Many celebrities have started purchasing apes, which has drawn more attention to the project. For example, NBA player LaMelo Ball, NBA president Daryl Morey, DJ duo Bassjackers, DJ 3lau, and several Chinese celebrities including Chen Bolin, Wu Jianhao, and Yu Wenle. They all use BAYC artworks as their social media avatars. These celebrities have sparked public interest in NFTs and BAYC.

Identity Belonging

Secondly, there is the identity attribute. Unlike Avatars, Bored Ape NFTs serve more like identity cards in social settings. Players use these NFTs as their social avatars, helping holders gain additional social capital and resonate with other BAYC members.

Community Benefits

BAYC emphasizes community elements, and owning a Bored Ape NFT grants exclusive benefits to club members. For example, access to the collaborative graffiti board "bathroom" feature on the BAYC official website. The BAYC bathroom contains a canvas that only users with at least one Bored Ape NFT in their wallets can use, providing a space for painting or creative expression.

Bored Ape Yacht Club Bathroom

Additionally, the project has created The Bored Ape Kennel Club to reward club members. Each club member can adopt a Club Dog NFT from the Bored Ape Kennel Club for free, only needing to pay the gas fee. This announcement led to a surge in the price of Club Dogs in the secondary market, with BAYC's floor price soaring to 3.85 ETH. Currently, the floor price for a single Club Dog is 0.5 ETH.

Moreover, BAYC purchased a piece of land in The Sandbox game, where the project team will establish a venue exclusively for club members. On June 18, the BAYC team airdropped a wearable hoodie to each Bored Ape NFT user's wallet, allowing BAYC members to quickly identify their peers in the Metaverse. Players can showcase their apes at virtual gatherings hosted in Decentraland.

BAYC community members have established additional projects and side projects, such as the 'Bored Ape Children's Club,' where people create child versions of Bored Apes, and in beauty salons, where you can "transform" your Bored Ape's hair with new styles.

Copyright Ownership

Generally speaking, the copyright of NFTs does not belong to the buyer. However, the ownership and commercial rights of BAYC are granted to the buyer upon transaction. BAYC grants Bored Ape NFT holders full commercial rights to use, reproduce, and display the purchased collectibles, as well as to create derivative works from them.

People often ask why they should purchase NFT collectibles and what significance they hold. Besides price speculation, are there other sources of income? BAYC serves as a great use case. The image below shows merchandise released by Ape owners, including shoes, stickers, t-shirts, etc. Some of these t-shirts even reach $3,000 each. Owners can profit from this. Through the transfer of copyright, BAYC has evolved into a trendy brand, which is what sets it apart.

Interactive System

The future plans outlined above enhance BAYC's social influence or the income sources for its owners. For instance, there is a treasure hunt event starting in less than a month. According to the latest updates from the official team, winners can receive rewards including Ape #10, a Club Dog #10, and 5 ETH. BAYC has launched liquidity pools on NFTX and NFT20, integrating DeFi elements into NFTs, which will increase income sources for owners. Additionally, the BAYC official team has also launched a community Grant program, offering up to $3,000 in rewards for creators working on BAYC projects. In contrast, many Meebit holders have expressed concerns about the lack of interaction from Larva Labs.

Limited Membership System

Combining NFTs with limited membership, NFTs are becoming increasingly linked to brand marketing. It is not surprising that many perfume and luxury brands are entering this market. For example, Rook Perfumes' Metaverse NFT offers buyers the opportunity to participate in creating their own custom scents. Rook Perfumes consultant Melissa Gilmour stated that over 30 people have joined the brand's NFT project. In addition to a private Telegram group, NFT owners can test and vote on sample scents. The price of the NFT is about $700 each.

Today, brands are capturing the minds of a small segment of people, building a highly loyal product system, and ultimately promoting products through influencers across various fields.

However, whether this is a marketing model of a new appearance with an old core or a future that can change user participation and experience remains to be seen.

Only time will give us the answer.

But through BAYC, we can be certain that as the NFT collectible community continues to mature, players are becoming increasingly interested in projects with practical utility. They seek not just a piece of digital art but a larger world that encompasses identity recognition and community belonging.