Global pop superstar Justin Bieber has seen a significant drop in his Bored Ape Yacht Club (BAYC) NFT investment, losing more than 95 percent of its original value.
BAYC is a massively popular NFT collection of 10,000 unique digital collectibles in the form of cartoon apes. Bieber purchased BAYC NFT #3001 in January 2022 for 500 ETH, worth $1.3 million at the time.
Bieber’s ape sported a blue cap and gold chain. At the time of purchase, owning a BAYC NFT granted membership to an exclusive online club with the potential for real-world events and merchandise.
Yuga Labs’ NFT projects were massively successful, with both BAYC and MAYC selling more than $2 billion across three collections in secondary trading volume. However, the floor price for BAYC NFTs has since plunged to 29.95 ETH, or around $58,610.
Like Bieber, other stars like Eminem, Tony Hawk and Paris Hilton also have had their foray into the world of NFT with varying degrees of success.
Eminem invested heavily in BAYC NFTs, purchasing a rare ape for $462,000 in December 2021. Like Bieber, Eminem likely suffered significant losses as the floor price plunged. However, Eminem sees long-term value in NFTs and the BAYC community.
“I’ve been collecting art for a while now, so digital art and NFTs were a natural progression,” the rapper said.
Paris Hilton, an early NFT adopter, has had mixed success. She purchased a BAYC NFT for $17,000 in June 2021, which reached over $300,000 at its peak but has since dropped below $100,000. Hilton has been an outspoken proponent of NFTs, calling them “the future of art and even real estate.” She has collaborated with NFT brands and released her own NFT collection.
According to experts, the NFT market has become oversaturated, with too many new collections flooding the space. The hype cycle around NFTs can lead to a boom and bust within months.
“The NFT bubble was mostly the initial start of the NFT market as we know it, where digitized ‘art’ was sold for way too much money,” said Michel Caspers, a co-founder of software development company Unity Network.
“Everyone who participated had a form of gold fever, and many with a realistic view already saw that this was not sustainable.”
Additionally, the macroeconomic environment, including inflation and recession fears, has led investors to abandon riskier assets like NFTs. However, some analysts believe the NFT market will recover and grow over the long term as the technology finds more mainstream use cases.
Flyfish Club CEO David Rodolitz said NFTs “are here to stay,” asserting they would change most industries. However, he said the market would look for projects focused on utility and “IRL moments.” According to Rodolitz, NFT projects that do not focus on creating value for others will not gain buzz.
While NFTs offer an innovative new model for fan engagement and brand building, their volatility presents a substantial financial risk. Despite its fading popularity, analysts note that they continue to attract interest as a new frontier at the intersection of technology, business and culture.
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