Bullish Bored Apes?

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Two years ago, the Bored Apes were on top of the world. 

Yuga Labs, the BAYC creators, were riding high after announcing their Otherside gaming metaverse and acquiring CrypoPunks and Meebits from Larva Labs. 

This momentum created a fervor, with collectors piling into Bored Apes like never before, which pushed the collection’s floor price to its reigning all-time high of 128 ETH.

Since then, though, things have seemed down only. Last week, the BAYC floor price dropped to 10 ETH—the lowest the floor has been in nearly 3 years and a -92% drop from the April 2022 ATH. 

Why the decline?

Some of the contributing factors here have been beyond Yuga’s control, like the rise of hyper-farming on Blur generating sell pressure, or more collectors jumping ship to take positions in hotter ecosystems, like Bitcoin Ordinals or Solana memecoins.

Other factors are Yuga’s fault, though. At their peak, they swelled their offerings to 25 different collections, a sprawling umbrella that’s confused and turned off more than a few holders. Their recent acquisitions of PROOF and Moonbirds puzzled many, leading to complaints that Yuga lacks a cohesive grand vision. 

Additionally, for now the highly-anticipated Otherside metaverse is still early on in development, and while the initial playtests have looked promising, smaller teams like Nifty Island have gone farther, and faster, toward a similar end. 

Another point worth briefly mentioning here is sign value.

NFTs not only derive value from their utilities and exchangeability but also from their social dimensions, and the social value of a Bored Ape today is the lowest it’s been in a while. They don’t have the same aura they used to, for now their main value is exchange value, and some holders have moved on to more memetically-charged projects as such. 

So what’s Yuga Labs to do? Can they rebound and return Bored Apes to their former glory?

It’s certainly possible, and there have been some encouraging signs lately. First and foremost, Yuga co-founder Greg “Garga” Solano recently stepped back in as the company’s lead. 

It was the right move after a lackluster CEO stint by former Activision exec Daniel Alegre, and if anyone can help the Bored Apes recapture their early magic, it’s Garga. In his comeback announcement, he said:

“We want to unshackle the BAYC team at Yuga as much as possible to execute against its vision. More focus, more agility. So it can … create the space for the magic and crazy shit we used to get up to more often.”

This renewed emphasis on focus and streamlining is already coming through in other areas, too. For example, last week Yuga sold its HV-MTL and Legends of the Mara (LoTM) gaming titles to Faraway, indicating that it’s cutting down to double down on its main projects, like the Bored Apes and Otherside.

These kinds of moves are exactly what anyone who is rooting for the Bored Apes wants to see, but there is still lots of work ahead, so should we be bullish or bearish on BAYC three years in?

In the short term, things may get uglier before they get better. With ETH NFTs in an awkward spot and shinier objects around the cryptoeconomy currently, I could see the floor price of Bored Apes dip below 10 ETH, though I suspect that wouldn’t last for long. 

Longer term, the prospects look much better. Yuga has leaned into its partnership with Magic Eden, which is now the most active NFT marketplace, and that can pay dividends going forward. The launch of the ApeChain L2 later this year and the launch of Otherside in the years ahead can also be major BAYC catalysts. 

Additionally, Yuga still has a ton to work with regarding its brand, community, and resources. They’re certainly not standing in front of a blank canvas with few options, in other words. 

So while it’s presently impossible to say whether Bored Apes will ever reclaim their previous ATH floor price of 128 ETH, their future prospects do remain considerable, and I could envision the floor trading up past 40 ETH again by the end of 2024. 

Long story short? Bored Apes are down, but not out, and I think there is more to be bullish on here than bearish on at the moment. Let’s see if Yuga can follow through and pull off the comeback accordingly.

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