The creator of the popular Bored Apes Yacht Club collection of NFTs, Yuga Labs, launched a sale of virtual land related to its highly anticipated metaverse project, raising about $320 million worth ofcryptocurrencies in the largest offering of its kind. Demand was so strong that activity related to the event caused a domino effect across the entire ether block.
The holders of the ApeCoin token who verified their identities jockeyed to buy deeds for 55,000 parcels of virtual land in Otherside, the project's planned metaverse game and the latest extension of the Bored Ape franchise. The price of the coin went up last week due to anticipation of strong interest in the plots.
After the sale went live at 9 p.m., the price of each plot skyrocketed to around $5,800, with transaction costs and gas fees accounting for the rest. The land grab attracted a lot of demand. Each Otherdeed requires about $6,000 in transaction fees to be mint, which is more than the price, according to data from Etherscan.
One of the highest spikes in transaction fees on the platform were caused by the virtual land sale.
A fee is required for token creators or traders to make transactions on the network. When the network becomes congested, transaction fees go up. The transactions on other platforms can be slowed down by that.
Yuga Labs originally planned for the sale to be held in a Dutch Auction format in which the price of the Otherdeed NFT would go down over time to prevent high transaction fees. The format was changed to cap the number of Otherdeeds that could be purchased per wallet in each wave of the sale. The new plan didn't ease congestion. Yuga Labs apologized for turning off the light on the platform and suggested the creation of a coin.
The coins raised in the sale will be locked up for a year, meaning that they can't be sold. A Yuga Labs spokesman wouldn't say who the raised money would go to or if large holders of the coin would participate in the land sale.
Animoca's Yat Siu said in an email ahead of the sale that there are restrictions on how many NFTs a single digital wallet can buy.
More than 50,000 Otherdeeds were sold Saturday, and another 50,000 were allocated to holders of Bored Ape Yacht Club and Mutant Ape NFTs, as well as Yuga Labs and other project developers. The process for BAYC and MAYC holders to claim their free Otherdeeds was initially delayed because of the higher gas fee. As gas fees were settled, that one-time claim reopened for NFT holders.
A variety of web3 apps, using digital coins and blockchains, are using a digital coin called ApeCoin. The idea is for owners to have access to a variety of things. The governance token is also used by the board of the company, which includes Ohanian, FTX, and Siu. Ahead of the Otherdeed sale Saturday evening, OpenSea said it would accept the coin.
Some of the biggest recipients of the new coin, which was created as an airdrop, were some of the venture capital investors that helped with the launch. They and other launch partners received 140 million token. The coin's price has nearly tripled since it was released.
The frenzy around the land is very different to the market for cryptocurrencies, which has been trading sideways in recent months. In April, the monthly sales volume on OpenSea was higher than in March, but still down from an all-time-high in January.
Most of the apps that have sold virtual land have only seen a small number of users and transactions. In the last 30 days, the number of transactions on Decentraland has fallen by over a third.
The release date of Otherside hasn't been disclosed yet, according to the Yuga Labs spokesman. A trailer from Yuga Labs shows an ape fishing out a bottle and drinking up its contents before embarking on an adventure. Improbable will help build the Otherside platform.
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