NFTs as ETH Beta: The Collections Outpacing Ethereum’s Rally

In investing terms, “beta” measures how much an asset’s price moves relative to another asset.

If something has high ETH beta, that means the asset tends to move more than ETH in the same direction.

For example, if ETH rises 10%, an ETH beta asset might climb 20%. And the flip side's also true: if ETH drops 10%, the ETH beta asset could fall 20%, etc.

The idea, of course, is to achieve amplified returns during rallies.

Yet finding a consistent ETH beta has always been tricky, as Fiskantes recently pointed out. Crypto narratives shift quickly and what works one cycle won't necessarily work in the next.

However, one category that continues to have serious potential here is, yes, Ethereum NFTs. Like Fiskantes said:

The truth is, there is no reliable ETH beta [...] But if I had to pick one, I'd say its the thing that's denominated in ETH — Ethereum OG NFTs.

I totally agree. And I also agree with his estimation that for Ethereum NFTs to fully rip into beta status again, "we need a major wealth effect from ETH first sparking an NFT season."

In other words, growing wealth in ETH leads to more onchain discretionary spending, which in turn leads to NFT price explosions in ETH terms.

The thing is, we're already starting to see this dynamic rear its head again.

The price of ETH has surged 47% over the past 30 days while various popular Ethereum NFT collections have seen their trading volume boom and their floor price gains outperform ETH.

For example, over the last month the following collections have been ETH beta:

• Moonbirds gained +304% (to a 2.95 ETH floor)
• Mooncats gained +180% (to a 0.38 ETH floor)
• ChainFaces gained +150% (to a 0.02 ETH floor)
• Base Ghouls gained +125% (to a 0.03 ETH floor)
• CyberBrokers gained +115% (to a 0.14 ETH floor)
• Loot gained +105% (to a 0.14 ETH floor)
• V1 CryptoPunks gained +71% (to a 3.95 ETH floor)
• Chimpers gained +57% (to a 0.7 ETH floor)

If ETH's current rally keeps steamrolling higher, the wealth effect Fiskantes described will intensify, and with it, the hunt for ETH beta will heat up.

And the beauty of NFT beta specifically is its reflexivity: ETH pumps fuel NFT buying and rising NFT floors create more ETH-denominated wealth. This cycle can go 'round and 'round for a while.

Of course, that reflexivity cuts both ways. ETH weakness can unwind NFT gains even faster. But in strongly bullish conditions like we’re seeing now, these pockets of amplified upside become crossroads for culture and capital flows.

Ultimately then, if you believe this Ethereum breakout has plenty of room left, it's a good time to review your NFT collection and lean into your favorite established projects. They might be in for some fireworks in the weeks ahead!