They're Taking Loans On Literal Monkey Pics

(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 all and happy Mint Weekly Tuesday. Another busy week in the books and the NFT market cools off while our fungible tokens are "literally mooning". While I hope many of you took some profits last week, things are still *not half bad* (all things considered). A very hyped new mint is able to sell out and volume is relatively high. While there is a ton of FUD related to NFT lending with Yuga assets and the upcoming blur airdrop, we have still yet to nuke into oblivion (for the time being). That being said, it wouldn't surprise me if we headed down that path by the end of the month.

I've been pretty swamped with some IRL stuff as of late, so I took this week easy after what was a wild end of 2022 and first week of 2023. Going forward, I'm fully concentrated on 1-2 high conviction plays, and doing my best to sit on my hands for now. Also, if you've been reading Mint Avalanche with Chuck, I've been buying up a lot of Avax NFTs as this narrative seemingly has been forgotten (not for long IMO). Anyways, let's dive in.

Market Overview

Overall, the NFT market is healthier than it's been in quite sometime. While I don't want to say conditions are "good", they are certainly not horrible. We're still lacking new entrants which means current participants are much smarter and we don't see new mints/free mints becoming easy degen plays like they used to be. Along with this, participants have adopted a much more short-term mindset due to the volatility. We're all familiar with GCR's echo bubble thesis, and the market seems to be applying this to jpegs with the proliferation of a "get in quick, get out quicker" mindset.

There's 3 big risks we're facing right now. In no order of importance:1. ETH price is continuing to rise rapidly. ETH at $1200 is no different for NFTs than ETH at $1600, but ETH price volatility is certainly not what we want. As it goes, ETH continues to rise and many will capitulate to FOMO back into their ETH bags. While the majority of the NFT bull run took place from $2500-$3000 ETH, we have to consider how *down-bad* everyone is. If you're still in the market, as mentioned above, most likely you are looking to take fiat profits quickly. Because of this, I don't think NFTs can thrive in a ~$1800-$2000 range in the bear market like they would have been able to in the bull. While we're not there yet, it's something to consider.2. Blur bid farming, which undeniably is adding a ton of liquidity to the market, will not be as persistent once the airdrop is complete. Right now somebody can dump 150 ETH worth of MAYC, Pudgy Penguins, and many other projects without making a significant dent in the floor. This won't be the case next month.3. Leverage. I'm no expert on this but there's a ton of Apes and Mutants being borrowed on leverage which risks the potential for a downside cascade. Add another Yuga mint (yes I know it's free) to the mix and this adds a ton of uncertainty. We all know what happened last time with Otherside practically marking the top of the bull run. Would give Cirrus a follow as he's a real expert on this subject. Overall, a blowup in borrowing could drop Ape floor prices 20%+ which would trickle down to many collections in the market.

Risks aside, people are still buying jpegs. Volume is down this week, which makes sense after the wild start to 2023. That being said, we're still doing the most amount of trading volume since July 2022 (6+ months), so there's little to complain about.

Blur is continuing to eat away at OpenSea's market share and I expect this to continue throughout the year even after the airdrop, unless OpenSea moves to lower fees/royalties and/or drops some sort of token. With this, I'm still quite interested to see the mechanics of Blur's airdrop. After speaking with 100+ active traders, not a single one is planning on holding blurs token. I'm getting the sense that the FUD and hype around the airdrop may be overblown on both ends and the market doesn't react as aggressively in either direction as everyone expects. The main catalyst on the horizon is the upcoming Yuga mint, while the black swan is a quick move from ETH $1600 to $1800+.

Blue Chip PFPs

Will keep this simple as I got good feedback the other week. I'll do a short floor price ranking from blur and the week-over-week delta. I’ll also do a small summary of my (biased) thoughts at the end. I’ll do some slight rounding for simplification as well. These are from this morning EST.

First of all, I removed Cool Cats (sorry not sorry). While the Cats are OG, they can't really break anywhere steady above 2.5 ETH and there's a handful of projects with a higher floor so I felt this was justified. For now, this list is very simple. There's basically 2 categories at this point: Yuga and non-Yuga. For the most part, almost all of the blue chip PFPs took a decent beating this week after the last few weeks of UpOnly. Notably, Doodles started gaining some steam moving to the #5 slot. There's a lot of anticipation for a big announcement coming Doodles way, and I expect this to pump the project ~20% higher or lower depending on how its received. I wish I knew the direction 😅. Azuki is still the strongest non-Yuga asset and no other projects seem to put up a fight.

Penguins had a rough week as some of the largest holders, including 9x9x9, dumped a ton of penguins for blur bids. Definitely some FUD on the timeline around Penguins but on-chain analysis shows this was to repay a loan. They've been grinding up since ~August so a week or 2 of big pullbacks isn't surprising.Moonbirds had a solid run to 8 but is definitely bleeding. Should expect some news here as well as it's been relatively quiet. Clones continue to struggle and I see a ton of folks abandoning the project on twitter. They also dipped below 5 ETH for the first time ever in this bear market. Still, I'd be surprised if Nike didn't have something up their sleeve.

As always, Punks are a stablecoin.

While I don't really think any other projects deserve to be on this list, I do think a top 10 is much better than a top 8. While I won't be adding new projects anytime soon, unless deservingly so, if there's any ~10K PFP projects I'm missing feel free to comment on this post or dm on twitter.

Musings

Essentially using this section as my journal where I share my opinions and thoughts on what I am paying most attention to. I'll try not to ramble and keep this semi-structured.

First of all, don't fade cult communities and memes. Miladys hit 2 ETH the other day and this project just cannot get out of the spotlight. Despite all the FUD, there's something hilarious about Milady PFPs on twitter despite the controversial law. Nonetheless, these projects show more long-term perseverance than what I like to call *influencer pumps*. Lucky guess below from a few days ago.

Speaking of funny and cultish, Kanpai Pandas art update is awesome. This is the project I am having the most amount of FOMO from right now and Ice Bagz continues to kill it. At 1.5 ETH, the Pandas have been crawling their way up the charts and are one of the loudest communities on twitter. They remind me a lot of Sappy Seals with their twitter engagement but have a lot more potential long-term (no hard feelings seals) as seals seem to follow Penguins price action a bit too closely.

Moving on, it's nice to see that digital pictures of feet are still going for $250. While you may say we're in a bubble, this statement makes me feel at home. All things are right in the NFT world when nothing makes sense to outsiders. While I'm not really bullish by any means on jpegs right now, this is inherently bullish as high volume degens are playing this project. I don't agree with a lot of the below BUT I think it's worth the read and some solid bullish hopium. All in all, I understand his points well and it's certainly possible he's right. As you know, I reserve the right to change my mind. Plus it does help to be bi-polar in this market so I may tweet out my giga-bullishness in 72 hours from now, who knows.

Moving on, I've been looking into Avax NFTs a bit more again. Ok, not really, but I've been buying a ton of Chad Doges on Avax. While the avax ecosystem for NFTs isn't necessarily popping off like it was back in June/July, I really like this project (NFA). I think if Avax NFTs ever take off, and I do think at the minimum we get another mini-bull run in Avax NFTs, Chad Doge will solidify itself as the premier PFP. The art is great, the team is great, the community is great, their rollout of the 2nd mint was great. Everything they've done has been spectacular in my opinion and it really sticks out to me. Keep in mind I am shilling my very heavy bags here (if you consider $60 NFTs heavy) but this project does get me excited for NFTs that aren't ETH-native. Plus if you're reading this and trade Avax NFTs, there's like a 90% chance you own one the doges anyways.

Wrap Up

I'm a bit unsure of how this week plays out. I think we still have anywhere from 2-4 weeks of purgatory before our NFTs decide if they want to take a huge hit or steady grind up. What I am confident in, is that we're still in a bear market for crypto and NFTs, despite these 2-3 week super rallies. Don't worry though, the mid cap project you bought for 2 ETH and sold for .3 is never hitting 50% of it's ATH again so you made the right choice. Let's have another great week!Cheers,Wilson