Let’s start from its background. A non-fungible token, CryptoPunks, was introduced by only a two-member team consisting of Canadian software engineers John Watkinson and Matt Hall in June 2017.
Still, it has become one of the most expensive within a few years of its release which enables us to investigate and find the reasons why it is so expensive? Also, What are the factors responsible for it?
Before jumping deeper into it, let’s understand the people’s mindset before buying it and what are the crypto punks used for?
Why Are CryptoPunks So Expensive?
CryptoPunks are so expensive because of scarcity, Decadent value, Age and their popularity
Let’s understand what are the possible factors making cryptopunks so expensive and appealing to people to invest in it. Following are the points elaborating the reasons behind its expensiveness.
NFT creator determines the scarcity of its value. For example, a NFT creator is selling duplicate copies or different versions of one Non-fungible token, and another creator is taking interest in the creation of rare digital artworks.
In such a scenario, the NFTs authenticity is determined by their metadata and the unique IDs.
The limited artwork, its value will be inflated. As mentioned previously, no dual CryptoPunks are the same, hence this scarcity will lead people to pay high prices if someone wants to own the NFTs.
2. Decadent Value
The Decadent value can play significantly when valuing a Non-fungible token. This implies how much entertainment the user gets out of the NFTs.
For example, Dorsie’s First Tweet gets its high value due to being the first and unique tweet ever posted, this provides it socio-cultural importance as a milestone landmark.
Organically, for the people who possess CryptoPunks have a lofty Decadent value. The Figma’s Chief Executive Officer and the Cryptopunks’s former owner has also stated the cryptopunks “The digital Mona Lisa” which means it has unparalleled values and demand as well.
NFT’s Age can be a significant factor for increasing its value. Older age will lead to higher prices. Based on this theory, the older NFTs will always have a higher price like an old painting like Monalisa.
CryptoPunk is one of the older NFT and that’s one of the prime reasons why it has higher resale values. You can easily go through the longevity of any NFTs by checking its description.
The description consists of all the detailed information about NFTs including creator name, address and longevity.
Other than Age, Scarcity and Deccandent value, the popularity of any piece of NFTs can be the biggest factor why it is so expensive. Popularity creates excitement and increases desire to buy it which maximizes its price.
Larva Labs released Cryptopunks which were available for no cost in its early experiments. But, now crypto punks are being put on sale to billionaires having millions of dollars in spare. It has the latest listing of 90 million dollars.
You can estimate its popularity from taking inspiration from an incident in mid-2017, CryptoPunks was established as a set of 10,000 items and became one of the ERC-721’s early influences.
They’ve been highlighted in publications like The New York Times, Christie’s of London, Art |Basel Miami, and the PBS NewsHour.
Lastly, the prime reason for crypto punks being expensive is rare and unique. There will be only one type of single NFT existing ever. This means there can’t be more NFTs of a similar type, making it so expensive.
Each crypto punk has different attributes and attire. In simple meaning, “rarer item has a higher value.”
Also Read: Best NFT Rarity Ranking/ Checker Tools
What Are CryptoPunks Used For?
The CryptoPunks are used as a form of digital currency and can be purchased on various online exchanges. Their unique feature is that they can be traded or used for services. CryptoPunks can also be used to create unique digital identities.
CryptoPunk is one of the first groups of NFTs on the Ethereum blockchain. Consider these 10,000 avatars to be a collection of virtual art personalities. Each CryptoPunk is unique, which has fueled the current CryptoArt movement.
To buy the original Cryptopunks on OpenSea, you may have to visit https://opensea.io/collection/buycryptopunks
Also Read: NFT Smart Contracts Explained
Wrapping The Article
CryptoPunks have surged in value as the popularity of Non-Fungible Tokens has grown. The unique and rare nature of these tokens has led to a high demand, with some selling for millions of dollars.
While their use is currently limited to trading and digital identities, their potential is limitless. As more people become familiar with NFTs, the value of CryptoPunks is sure to continue to increase.
CryptoPunk 7523 is the most expensive crypto punk sold at the price of $11.7 million in Sotheby’sSotheby’s auction to Shalom Mackenzie. Similarly, CryptoPunk 9998 was sold for $530 million fraudulently.