CryptoPunks, launched in June 2017, paved the way for digital art on the blockchain. These are 24x24 pixel art images generated by an algorithm. Punks can be male or female. Some rare punks are ‘Apes’, ‘Zombies’ and ‘Aliens’. These punks were the primitive NFTs (non-fungible tokens) created on Ethereum blockchain. You can check the contract creation date on Etherscan. There are only 10,000 punks ever created with proof of ownership stored on the Ethereum blockchain. Every punk is unique and safe from duplication due to their existence on the blockchain. CryptoPunks completed their 3 years anniversary some months back and there was always decent demand among Ethereum based art collectors.
CryptoPunk 4553 - One of 6039 Male punks
CryptoPunks are the inspiration for Ethereum’s ERC721 standard that powers most digital arts. The code was almost like ERC20 with some ERC721 type codes built onto the protocol. The makers said: “The actual images of the punks are too large to store on the blockchain, so we took a hash of the composite image of all the punks and embedded it into the contract. You can verify that the punks being managed by the Ethereum contract are the True Official Genuine CryptoPunks™ by calculating a SHA256 hash on the CryptoPunks image and comparing it to the hash stored in the contract.” When the punks were launched, anybody could claim free of cost using a personal Ethereum wallet but all those were quickly claimed. It was a new concept. The unique characters were assigned to the addresses and this provided a new way to prove ownership. The secondary market demand increased quickly and a normal punk was selling for $20-30 during the end of 2017. In early 2018, the demand for the punks increased as ETH reached its ATH. In 2019, ETH price tanked but the demand for the punks was quite steady.
Image Source - The early average price of CryptoPunks
ETH is again near its 2018 ATH now. The market dynamics have changed a lot in the last few years. DeFi activity is growing at an exponential rate and the demand for NFTs is surging high. CryptoPunks are getting a lot of attention nowadays and selling for an astronomical price. The punks are getting traded on several NFT marketplaces now. You can check the present bid for your preferred punk in the official marketplace created by Larvalabs. Everything is managed by a smart contract running on Ethereum blockchain. To bid, buy or sell you need to login through your Metamask wallet. The punks with a blue background are already claimed. The punks with a red background are available for sale and the punks with a purple background have an active bid on them. Every unique attribute is a selling point. Suppose there are 10 ‘Apes’ and only one of them wears a knitted cap. That particular pixel art should be more coveted.
Current bids for punks
The ‘Aliens’ are in great demand as only 9 of them exist. Due to rarity, these are attracting prices over 600 ETH now. Scarcity is the fundamental base of economics. When demand is more than the supply, the price gets increased. The rarity of the punks is creating scarcity for the collectors. FlamingoDAO, a decentralized autonomous organization (DAO), is currently investing in NFTs and they are buying a lot of rare punks. The DAO has a plan to create different metaverses down the line and they need the punks to attract new investors.
Blockchain technology can revolutionise the art market. CryptoPunks are getting such an extraordinary price due to their historical value. Can you judge a Picasso painting only as per the quality of the painting? NFTs are no exceptions. The rarity of such NFTs is assigned by the blockchain. CryptoPunks created an important milestone in the era of digital collectables as those signified the first proof-of-concept that any digital asset could be provably rare. The precursor of helping the artists to monetise their works started with CryptoPunks which brought a better system to recognise what was original and what was fake. Exciting future is anticipated for this wonderful use case of blockchain technology. Price is really a magnet and the whole world is watching the success story of CryptoPunks. Owning a pixel art of ‘Alien’ or ‘Ape’ in an Ethereum wallet can really be a status symbol down the line.
Note: This post was first published here for Cryptowriter in association with voice.com.