NFT Review: Q1 2023 📣 – by William M. Peaster
Metaversal is a Bankless newsletter for weekly level-ups on NFTs, virtual worlds, & collectibles
Dear Bankless Nation,
As we wrap up the first quarter of 2023, the NFT space is continuing to expand in all directions.
That said, the pace of development here remains incredible too. We’re on “crypto time” — so much has happened in the past three months that this period has felt more like a year, right.
In this post, then, let’s recap with a rundown of the 20 most significant NFT developments of Q1 2023. Here’s your refresher on the biggest events that have shaped the ecosystem so far this year!
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Jack Butcher, founder of creative agency Visualize Value, has surged to prominence in the NFT ecosystem since the start of the years thanks to his Checks VV project, which has become arguably the most successful example of an open edition (OE) mint to date.
Inspired by Elon Musk’s acquisition of Twitter and the launch of Twitter Blue subscriptions, Butcher created a grid of 80 multicolored “checkmarks” that commented on verification and authenticity. With 16,031 NFTs minted within 24 hours, the project has since employed a burn mechanism to create different checkmark combinations, a.k.a Originals.
Butcher’s ongoing experimentations and transparent approach has rapidly garnered a strong community around the project, inspiring hundreds of derivatives in the process. In addition to Checks, Butcher’s separate OE collection Opepens has also attracted major interest since January and has morphed into an experimental, constantly evolving PFP project.
NFT marketplace aggregator Blur launched its highly-anticipated $BLUR token through an airdrop, joining the ranks of other significant NFT ecosystem airdrops such as $RARE, $ENS, and $LOOKS. The launch of the native token was aimed at decentralizing governance of Blur, and its arrival and ongoing bidding and listing incentives have helped the upstart marketshare attract and consolidate market share from rivals like OpenSea.
Spearheaded by 6529 Collections, The Memes is a collection of art editions created by various artists that focus on spreading the message of decentralization. These ERC-1155 NFTs are minted on the Ethereum blockchain, with edition sizes typically ranging from 300 to 1,000. These public domain collectibles exploded in popularity in January, nearly reaching an 80,000 ETH market cap at the time. Since then ReMemes, community-driven derivatives of The Memes, and the Meme Lab, an experimental CC0 contract for Memes artists, have further widened the project’s horizons.
The de facto “Art Blocks of AI art,” Braindrops serves as a platform dedicated to facilitating NFT drops for AI artists. The platform typically features collections ranging from 500 to 1,000 pieces, with an initial primary price of 0.1 ETH per piece. Minting is done “lottery-style” meaning collectors receive a random and unique 1/1/X piece from a given series. So far this year, multiple collections released through the platform have seen significant primary and secondary market activity as interest around AI art has exploded in recent months.
Yuga Labs released Sewer Pass NFTs as a free claim for BAYC, MAYC, and BAKC holders. These passes then granted access to the Dookey Dash competition, a Bored Ape-themed game in which scoring more points granted better chances at a rarer NFT later. After the contest, the passes became tiered per scores, and Fortnite professional Mongraal made waves when he accepted a 1,000 ETH bid for the top Sewer Pass. This and the rest of the scored passes were then made redeemable for HV-MTL (pronounced “heavy metal”) NFTs. These 30,000 mech game avatars will have dynamic traits and be connected to Yuga’s Otherside story, as they are “machines from the rift.”
In January, Lil Pudgys — the cute Pudgy Penguins expansion collection — went cross-chain. In partnership with LayerZero, an omnichain interoperability protocol, Lil Pudgys can now seamlessly travel between multiple chains, including Polygon, BNB Smart Chain, and Arbitrum to start. The collaboration is aimed at expanding accessibility around the Pudgy Penguins ecosystem and reducing gas fees.
In other big NFT bridging news, more recently the 15,000 strong y00ts collection kicked off its migration from Solana to Polygon this week. DeLabs, the startup behind y00ts and DeGods (which itself is migrating to Ethereum from Solana), received a $3 million grant from Polygon to facilitate the move. At the time of writing, more than 11,500 y00ts had already been bridged over to their new home chain.
The delegate.cash team introduced Liquid Delegates (LDs), a new primitive that allows users to rent out delegation rights to their NFTs in a trustless and secure manner. LDs enable a range of use cases, such as trading airdrop claim rights, event ticketing, and beyond, and to create one all you have to do is deposit an NFT into an escrow smart contract via delegate.cash. Additionally, the new native marketplace provides a platform for easily buying or selling LDs.
The Bitcoin ecosystem is experiencing a tremendous activity surge lately on the heels of the introduction of Ordinals, a system that converts individual satoshis (the smallest BTC denomination) into non-fungible digital artifacts. Despite facing criticism from some hardliner Bitcoiners, Ordinals has been praised as revolutionary for Bitcoin’s NFT scene, and their mints and collecting activity have been driving up transaction fee revenues for Bitcoin miners. Compared to onchain Ethereum NFTs, Ordinals “inscriptions” are significantly cheaper to mint, and their growing popularity suggests they’re here to stay in the cryptoeconomy whether the most dogmatic Bitcoiners among us like it or not.
Popular NFT marketplace OpenSea temporarily lowered its marketplace fee to 0% in response to competition from the popular low-fee platform Blur. OpenSea also set optional creator royalties starting at 0.5% for collections without onchain royalty enforcement and adjusted its blocklist to allow sales on NFT marketplaces with similar policies, including Blur. The rivalry between the two platforms intensified earlier this year upon the $BLUR airdrop and associated incentives campaign, which have helped the NFT marketplace aggregator win major market share.
The Centre Pompidou is a world-renowned, multidisciplinary cultural institution in Paris that houses a vast collection of modern and contemporary art. In February, the museum made headlines in announcing its acquisition of 18 NFTs from 13 prominent artists, including mints from artists such as Jonas Lund, Agnieskza Kurant, and Sarah Meyohas. At the time, the Pompidou’s director, Xavier Rey, emphasized the museum’s support for artists exploring new means of expression, which he argued was the very basis of modern art.
Meta chose to cease NFT support on Instagram and Facebook, not even one year after launching digital collectible features. The announcement was made by Stephane Kasriel, the head of commerce and fintech at Meta, who shared on Twitter that the company’s resources will be allocated to other products. In the NFT ecosystem, the decision was widely derided as lacking foresight, but in any case the move came as part of Meta’s broader restructuring efforts, which have involved laying off thousands of employees in recent months.
It was the quip heard ‘round the NFT world. In a Discord post, Doodles co-founder Jordan “poopie” Castro justified his team’s decision to develop new features and products behind the scenes in asserting that Doodles had transcended its “NFT project” status to concentrate on becoming a top media franchise. Castro’s remarks were met with mixed reactions, with some praising the ambition and others interpreting it as a dismissal of web3 values. Whatever your views on the matter, the episode has highlighted some of the main tensions contemporary NFT-based brands face.
Reddit CEO Steve Huffman recently confirmed that part of the next phase for the popular Polygon-based Reddit Avatar project is the introduction of a dedicated Reddit Avatar Marketplace, where users will be able to readily create, sell, and trade avatars. Although still in development, the marketplace is expected to see significant activity upon launch given the current popularity of Reddit Avatars, which have seen 10.6 million NFTs already collected by more than 7 million holders and have a current market cap of ~$123 million.
Nouns DAO chose the proposed Aragon x Aztec collaboration to develop its upcoming private DAO voting system. Together, Aragon and Aztec will now create this cutting-edge voting solution using zero-knowledge (ZK) tech, with the aim being to offer a one-step voting process that minimizes offchain dependencies. The development will consist of three stages: an MVP featuring onchain private voting; the integration of a delay-relayer service to batch votes and enable third-party gas payments; and the deployment of a time-lapse service for secure vote decryption post-voting. This advanced resource is aimed at improving the NounsDAO voting experience by prioritizing fairness, privacy, and user-friendliness.
The Smolverse introduced several enhancements for its Smols NFTs by adding onchain support. Onchain Smols will also have spendable “IQ,” allowing holders to purchase items in the Smolverse using IQ points, and with head size adjustments corresponding to IQ increases or decreases. Additionally, dynamic traits now enable holders to earn new costumes and wardrobe items for their Smols onchain. To migrate, holders must burn their existing NFT to receive an identical token ID on the new onchain contract.
Immutable announced its partnership with Polygon to develop Immutable zkEVM, a new L2 scaling solution for NFT gaming. This Ethereum Virtual Machine (EVM)-compatible ZK rollup, powered by Polygon’s zkEVM technology, will optimize for web3 game development by providing excellent UX for gamers and superior flexibility for developers in enabling easy migration of games from Ethereum or other EVM networks without code changes. The partnership has the potential to position Immutable zkEVM as the leading gaming L2 in the cryptoeconomy, and it will see Immutable’s native $IMX token upgraded in phases to become the new L2’s gas token and beyond.
The talk of the town in some NFT circles lately? Stealcam. This novel social app launched in beta on Arbitrum a couple of weeks ago, and it enables users to 1) “steal to reveal” hidden NFTs belonging to others, and 2) effortlessly mint their own concealed NFTs for others to “steal.” As these NFTs, referred to as Memories on Stealcam, are stolen, their prices increase by 0.001 ETH along with 10% of the prior price, leading to a sort of “steal-to-earn” mechanic. The previous owner is thus reimbursed for their initial payment, while the remaining amount is distributed among the previous owner (45%), the creator (45%), and the protocol (10%). If you’re looking for new things to do on Arbitrum, Stealcam is a fun and brand new app to experiment with.
Developed by HiFo Labs, the new Nakamigos NFT project notably surpassed the Bored Ape Yacht Club in lifetime trades within four days of its March 23 public mint. The 20,000-strong PFP collection features 24×24 pixel characters resembling CryptoPunks and grants commercial rights to their holders. While the project’s artist remains anonymous, much speculation has linked Nakamigos to Sartoshi, the crypto artist behind the 2021 mfers collection. All that said, the future of Nakamigos is uncertain, as HiFo Labs remains enigmatic.
Music platform Sound just launched Sound Swap, a unique DeFi-inspired bonding curve infrastructure aimed at helping musicians reach broader audiences, optimize earnings, and ensure liquidity for their NFT drops. Sound Swap enables one-click collection and sale of music NFT editions, allowing collectors to mint editions even after the primary sale ends and facilitating instant sales at the current market price. This approach is likely to inspire similar models for various types of collectibles in the future.
Art Blocks, the popular generative art platform, just launched its own secondary marketplace that allows collectors to browse and trade NFTs directly on the project’s website. Unlike other Ethereum NFT marketplaces, Art Blocks does not charge a platform fee for secondary trades and fully honors artists’ specified creator royalty settings.
William M. Peaster is a professional writer and creator of Metaversal—a Bankless newsletter focused on the emergence of NFTs in the cryptoeconomy. He’s also recently been contributing content to Bankless, JPG, and beyond!
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Not financial or tax advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This newsletter is not tax advice. Talk to your accountant. Do your own research.
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