NFTs Are Fun Again

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 and happy belated new year all. It’s been a few weeks since I decided to rant about the markets and wow have things been moving quickly. Spending every waking hour of your day focused on trading, researching, and staying on top of trends isn’t easy and ultimately I have found it much more difficult to write these longer form posts vs my 100 daily mini rants I post every day in discord (link). The majority of this blog’s existence has been during the bear market and now that we’re deep in the bull, I feel as if my attention has been pulled in 100 different directions. Anyways, will try to review some of the current trends and share some thoughts going forward. Since all of the people smarter than me are convinced we get the ETF tomorrow, I'm under the impression things will only get crazier. Of course, if the ETF is denied, I will have to go back to the drawing board and re-evaluate a ton of things, but I don’t expect this to happen.

Here’s a quick review of what I’ve been focused on the last month and some thoughts going forward from an NFT perspective.

Airdrops:
I have been aggressively farming Tensor over the last month or so. For those not familiar, tensor is basically the Blur of Solana. Tensor has done over $1 billion USD of volume and is one of the better marketplaces I’ve used.

It’s 99% confirmed that tensor will be doing an airdrop and I expect this to be similar to the first blur airdrop. For those who remember, blur airdrop #1 was significantly under-farmed and the farmers got some wild rewards. The mechanics are the same as blur (bidding/listing) and you’re able to do this while also profiting if you’re looking at the right collections. I have mostly been focused on claynosaurz, froganas, and then some small collections in periods of high volume. With the Jito airdrop last month, everyone went to FOMO into farming other Solana airdrops like Marginfi and protocols that seem very crowded and smaller than Jito. I don’t really see anyone on CT discussing Tensor or Solana NFTs. With how hot on-chain Solana got over the last month, it seems NFTs on Sol lost a ton of attention. With the Jupiter airdrop coming soon, Solana on-chain may heat up again which means very little attention towards NFTs - a good time to rack up some points. Overall expecting the rewards in late Q1 or Q2.

SEI NFTs

This was a fun one. I spoke with some smart friends who helped come up with this idea and posted a thesis on SEI NFTs way back before things blew up. This is probably where writing a newsletter would have informed more but I was too busy ranting to people in discord trying to get confirmation bias on this idea when many thought I was crazy. I was extremely early to this so the below are some thoughts on what this looked like.

Essentially, this reminded me a lot of Canto NFTs. Canto had about a 1-2 week period in the bear market where NFTs were absolutely cooking on that chain. Influencers were rocking canto longneck PFPs, the main marketplace was extremely broken (similar to pallet.exchange for SEI), and they were “hard to buy” early on. Now, we had this chain with a 3bn FDV and only 6m of TVL that was starting to gain some hype. However, there was nothing to do on the chain besides buy NFTs. Ultimately, this seemed like a low risk, high reward play to scoop up the top NFTs for cheap, which in my opinion at the time was The Colony.

Now, it seems like every influencer is shilling you their SEI bags. I think catching small narratives like these are extremely +EV but only if you get in early and get out quick. It’s important to recognize what is a short term, medium term, and long term play. For those wondering, I sold 90% of my SEI NFTs for some large multiples and am not super bullish anymore. A lot of the hype seems manufactured to me and every project has the name “SEI” in it. This is where I found grinding throughout the bear market really helped me succeed. If you were around for Canto, this “SEI NFT rush” has played out identically so far.

Where does this go from here? Not sure, but won’t remain too focused on it outside of trying to get WL for anything that seems legit on the chain.

Ordinals

This is another meta we’re currently in the middle of as I write this. Ordinals have been absolutely ripping over the last week or so, ever since the NodeMonke mint. I never touched Ordinals until I picked up my first NodeMonke and it’s a lot smoother than I imagined. While I think this Ordinal meta is cooling down, unlike the SEI NFTs I believe Ordinals (Bitcoin NFTs) will be a massive ecosystem in the coming months. I’m not sure what the meta will be but I an idea floating around is Bitcoin as the “luxury” chain. Also, a ton of Bitcoin people hate ordinals which only brings more attention to them, similar to early BAYC. If you haven’t already, go download Xverse or Unisat and start experimenting. I planned to mint multiple NodeMonke’s but got lazy and instead picked up a few on the floor higher. People will complain about how difficult it to do things on Bitcoin, complain about the fees, and write these “new” things off, and then FOMO much higher. Don’t let this be you.

NFT Season and NFT Tokens

ETH NFTs have been pretty steady the last month or so. Outside of BAYC melting from 30e to 24e and Azuki pumping, for the most part, the OG collections have been relatively flat. Penguins have created a new base around 10e and with the recent news that all penguins will be airdropped ~700 $dym (trading somewhere around $3-7 OTC) this changes the game. Most NFT projects top when they launch their token, helping holders finally gain liquidity - but what if their was an NFT that could act as a farm for some of the largest airdrops in the space? Would be revolutionary. I don’t know the mechanics on how this deal was done so will leave that there.

Moving forward, there is a lot of new money entering. We saw that with meme - this essentially kicked off the recent leg up for our jpegs. There’s $1.1 billion tied up in Blast, upcoming $zro airdrop in Q1, various NFT related tokens like $MCT and $Portal coming to market, and some other surprises along the way for those of us still on ETH Mainnet.

Call me crazy but I still am in the camp that Penguins will flip BAYC by the end of Q2. I think this will ultimately symbolize the old guard of NFTs officially taking a back seat, and the new guard taking it’s place. No hate on BAYC, but it makes 0 sense why anyone would spend 25 ETH on one when there’s probably 100 better options.

The NFT cycle we got in 2021/2022 was crazy and most people don’t believe we’ll ever see that level of stupidity again. Even at one point, I am embarrassed to admit I almost let this sentiment take control of me. However, I do think things are going to get very silly in NFT land again. Jpegs are going to start getting 5-6 figure token airdrops, which in turn should go toward buying more jpegs. Last cycle we had apecoin but this cycle we’re going to have 10+ apecoins.

As I said, NFT people get made fun of a lot but they’re one of the few communities that stuck around all bear market. Community this, community that, a lot of these folks are fully invested in this space (like myself) and I think the next leg up in NFTs will surprise a lot of people. With how crazy things got on SEI in just 2-3 weeks, this will be tenfold on ETH/SOL.

I’ll leave it there for now. I’m feeling pretty good and hopefully next time you hear from me we have an ETF approval and everything is much higher. Have a great week everyone!

Cheers,
Wilson