Cozy

Any views expressed in the below are the personal views of the author and should not form the basis for making investment decisions, nor be construed as a recommendation or advice to engage in investment transactions.

Gm everyone. I hope all of you reading this are doing quite well, although, it’s pretty difficult to not be doing well at the moment. Everything is up-only and you are a genius again. Things have managed to get even sillier since the last time I wrote an article 3 weeks ago. New coins are launching at multi-billion FDVs, Penguins temporarily flipped apes, and crypto is a topic of conversation almost every day on CNBC. It feels good to be back, and even better when your conviction pays off. Things flip on a dime pretty quickly and with all-time-highs on the horizon, there’s plenty of “I told you so” that you’re ready to deploy to your non internet cartoon friends but are holding back. While I joke that writing has become -EV for me at this point, taking away hours of grinding, I’ll use this opportunity to talk to myself and spew bullish propaganda. I think we are somewhere in between inning 4 and 5 of the bull market or 45-55% complete. The last 6 months or so have been quite fun, but things are about to get silly. If you haven’t already, your homework should be watching the below Bob Loukas video.

With that, I’ll cover some trends and topics in the NFT space that I’ve been focused on over the last few weeks. If we talk everyday in discord - none of this will come as a surprise. There’s so much going on right now it almost makes my job of writing much harder than when there’s only 1 or 2 narratives to cover.

As a reminder, I am not qualified to give any advice and I don’t fully understand why thousands of people continue to read my musings 😂 . After averaging around 18 hours a day of screen time over the last month, here’s some thoughts.

Quick thoughts on the NFT Market
The NFT market is healthy right now. ETH just ripped from 2K to 3K in a fairly short amount of time and most NFTs remained flat or even climbed up in price. For the most part, new mints are catching a decent bid pre-reveal but there hasn’t been anything too silly yet.

Volume on Blur has been steady, doing around 50-60K ETH in volume per week. However, if we add volume on Solana and Ordinals, things are looking more active then most of NFT twitter is making it out to seem.

We forget how brutal it was in the bear market. If a collection was doing $10,000 in volume per day, it was in the top 100 most traded. Now, we’re back to doing 9 figures of weekly volume on ETH and another 100 mil USD of volume on Bitcoin + Solana.

While nowhere near the ATH, NFTs had bottomed way later than our fungible tokens, so it only makes sense they have a lagged revival. Still, I’m quite bullish on us getting another Jpeg craze, having accumulated my bets over the last year.

In order to pass the time, I continue to farm Tensor aggressively looking to get in the top 300. For me, farming Tensor is a great way to pass time so I don’t overtrade. It’s time consuming and you don’t have to lose any Solana if you do it smart. Blur airdrop #1 airdropped ~$300m to NFT degenerates in a bear market. Imagine the effect Tensor will have in a bull.


Out With The Old, In With The New

Hopefully I will do my best not to offend anyone here. This week, pudgy penguins floor temporarily flipped BAYC.This was fairly underwhelming and felt like a slow moving train. While I expected this to feel like a “big” moment, I guess the slow grind over a year has made this a bit lackluster. A lot of NFT twitter seemed to have been caught off guard by Penguins rise over the last year. As a market observer, it is quite obvious that the Moonbirds acquisition was the nail in the coffin to accelerate this. My thoughts on the moonbirds acquisition below, summed up by Sanic.

There was also this great twitter spaces with Jebus and some other Penguins that sums up the whole “why are penguins going up” pretty well. It’s 2 hours long so none of you will listen anyways, but if you’re still surprised by Pudgys floor climb over the last year I would recommend listening.

Now, this is all my opinion - which you shouldn’t care about anyways. To me, this signals the transition from the old guard to the new. Apes, Moonbirds, Clone X, and many of the forgotten “blue chips” are the old guard. I’ve used this analogy in the past but I think about them as the NEO and EOS of last cycle for those who were around in 2017/2018. Did these pump again? Yes. But nowhere near their ATH.

The NFT space is super fragmented at the moment. The winners, are winning, and they are winning aggressively. On the other hand, the losers cannot seem to catch a break. Outside of Penguins, we have “new” projects like Madlads, Bad Kids, Tensorians, Quantum Cats, Nodemonkes, and a few more leading the way from a “price go up” perspective. If you talk to any of these folks, they wouldn’t tell you we’re in a bear market.

When I float around various groups I find this trend a lot. It shouldn’t be surprising of course, but those who hold “good” coins and “good” pictures will tell you we’re in a bull market. I think it’s pretty hard to rebuke this as Bitcoin is over 50K, ETH is encroaching on 3K, and basically every new coin is ripping multiple Xs on launch. On the other hand, a lot of last cycle’s “blue chip” holders will tell you we’re still in a bear market, in order to rationalize the fact that their jpegs may be down 90%. My personal opinion is that if somebody is bearish or thinks we are in a bear market, you should simply look around at what is occurring.

I have no animosity toward apes or projects of the past, I just see them as buying old coins from last cycle compared to the 10+ new shiny objects in this market, providing greater and easier opportunities to outperform.

Airdrops To Communities

This has been my favorite meta of this cycle so far. Every day it seems like a new protocol is going to be airdropping to NFT communities. Dymension, Wormhole, Arcade, and many more have allocated airdrops to specific NFT communities. With how successful the $DYM airdrop was, I expect this to accelerate rapidly in the coming months.

Outside of just holding a cute cartoon image on the blockchain, there’s always opportunities. This tweet below from Cirrus sums up a lot of it.

I feel like sometimes opportunities in this space are so easy and seem too good to be true. In turn, most write them off and are too lazy to explore them. When $Portal did their marketing campaign on twitter with the idea that if you tweet @portalcoin - you can get allocation - many wrote this off and blocked @portalcoin in their mentions. Of course, Portal coin is trading at a 5x+ from it’s pre-sale round and 20x from it’s angel round and anyone could have earned some for free. Side note, one of the reason’s Creepz floor has gone up over the last few days is due to Portals price OTC.

Blast, Base, and Other Stuff

There is a ton of money that will be unlocking shortly from Blast. I think this is one of the few cases in the market where “everyone” will be right in the sense that “Blast” season is next. Over the last few weeks, we had memecoins and NFTs on base network do quite well. With Blast launching mainnet soon, I expect a lot of the money to rotate from base and other L2s over to Blast (temporarily). This means there’s going to be a ton of opportunities to catch a hot memecoin or mint some new NFTs. Whether you’re bullish or bearish on blast, this doesn’t matter. I urge you to simply not be lazy, bridge when the time comes, and click some buttons to experiment. Being early to a new network is literally the most +EV thing you can do in this space.

When Are We In A Mania?

Got a great question this morning from WizBubba (who you should follow) -

“When we anticipate that things are “gonna get silly” for nfts, do you guys think that means silly for existing projects, or that we’ll see silly numbers again for new mints? Like 4-5 figure whitelist flips etc..”

This is a good question and I think it’s very important to keep this theme in the back of your head. Things will get quite crazy again in jpeg land. It’s up to you to recognize this, capitalize on it, and not get caught holding the bag. I think about how crazy the NFT White List craze was and people grinding hours to get spots.

For me, when people are minting something bc they genuinely believe it's going to be the "next" something that’s when you want to take note. Some of these projects will in fact be the “next” big project. Eventually, this will become a theme, and late cycle we’ll see projects minting for high prices like 1e+ (Remember Ragnorok, PXN, Valhalla, etc.). People will look not to mint and flip, but will mint with the idea to sweep the floor immediately at multiple ETH opening price because they think it will be the next blue chip.

Moonbirds minted at 2.5e and hit 40e floor within a week. Was there a way to capitalize dramatically on this? Of course. However, like many of the others, it was down only ever since that top. Once this theme comes back, I think it will be time to start thinking about how the NFT cycle is ending. We have a long way to go until then, but having your exit signal in mind never is a bad plan.

Bears Sound Smart, Bulls Make Money

If you are here and aren’t bullish on the future then I don’t really know what to tell you. The road past ATH isn’t going to be smooth, but it seems pre-ordained. Most of the “mania” we remember will probably not pick up until ATHs. But, I look forward to seeing the ‘NFT Index’ on Fast Money CNBC in the coming months.

Cheers everyone!

Wilson