What are CryptoPunks?
CryptoPunks are an NFT collection of randomly generated art on the Ethereum blockchain. The collection features 10,000 unique pieces of pixelated art where not two NFTs in the collection are alike. Each trait is randomly assigned to ensure that the character bears no similarities. CryptoPunks was created in 2017 as one of the first sets of digital collections and were free to mint for everyone who owned an Ethereum wallet. The collection features the more common male or female characters but also includes zombies, apes, or aliens, which sell for millions on third-party marketplaces like OpenSea.
What is a CryptoPunk? - Terminology
A CryptoPunk is a uniquely generated image on the blockchain with pixelated, 8-bit visual characteristics. Every CryptoPunk has a set of unique traits that constitute its appearance and can ultimately affect its value. The less common their traits are, the higher the value. For example, there are 87 CryptoPunk traits which can be a mole, hat, pipe, or earrings. The highest number of traits found on a CryptoPunk is seven, and there are also “naked” NFTs with zero traits. The most common type of CryptoPunks is human punks, while non-human punks – aliens, apes, and zombies are already rare.
Important Details About the Collection
For people interested in CryptoPunk, there are some things about the NFT collection that should be known, such as:
CryptoPunks’ creators got inspiration for the collection from London’s anti-establishment punk scene, which was highly popular in the 70s, representing the non-conformist identity of each cryptocurrency user.
CryptoPunks’ traits make each NFT in the collection unique, helping them resonate with a more significant part of the cryptocurrency audience.
The popularity of CryptoPunks started to grow in 2021 following the NFT boom when NFT transformed into a new asset class. CryptoPunks was the first collection that began to sell for millions as it symbolized a digital culture flex.
CryptoPunks helped other collections like Bored Ape Yacht Club become successful as it served as a status template for new digital collectors.
Unlike the current NFT collection, CryptoPunks were free and initially released as an experiment years before the NFT boom.
CryptoPunks are randomly generated pixelated art, and the developers have created the program from scratch meaning a piece of code is rendering the characters.
What is the History of CryptoPunks?
CryptoPunks launched for free on the Ethereum blockchain in 2017 and is inspired by the 70’s punk movement, which seemed to resonate highly with cryptocurrency users. CryptoPunks launched as a free mint collection, and developers only released 9,000 to anyone with an ETH wallet. The developers kept the other 1,000 as “Dev punks.” CryptoPunks grew in popularity only after an article published by Mashable highlighted the importance of digital ownership and explained how CryptoPunks fit in the digital scheme.
As the original creators of CryptoPunks, Larva Labs initially launched in 2005. Unfortunately, even though the collection was available to everyone with a crypto wallet, and sold out only after Mashable published an article explaining digital ownership at a time when the focus was on tokenization.
Who Created CryptoPunks?
CryptoPunks were released by LarvaLabs, a company that launched in 2005 but only created and released the NFT collection as a free mint in 2017. Matt Hall and John Watkinson are the people that conceptualized, programmed, and launched the highly popular NFT collection. CryptoPunks mirror the ideal of misfits who don’t fit in the current society – similar to how cryptocurrency users have been viewed ever since Bitcoin became an alternative cryptocurrency.
CryptoPunks Acquisition by Yuga Labs
On the 12th of March 2022, two important IPs that Larva Labs owned were acquired by Yuga Labs – the creators of the similarly popular Bored Ape Yacht Club collection. Yuga Labs purchased the IP rights to CryptoPunks and the MeeBits NFT collection. The acquisition only purchased the licensing and the commercial rights to both NFT collections, meaning that everyone who wants to integrate the NFT collections into the Web3 projects is entitled to do so.
What is the Purpose of CryptoPunks?
CryptoPunks were the first profile picture (PFP) NFT collection. The goal and purpose of CryptoPunks is to show digital status and showcase how an NFT owner differentiates from other individuals by owning CryptoPunks. Furthermore, with NFT showing digital ownership, owners of NFT can resell the assets for profit. Aside from the belonging factor and the idea that they resonate with the cryptocurrency misfits, CryptoPunks have a speculative role where every Punks owner can generate profit! As CryptoPunks continue to sell for over 100 ETH each, it’s easy to see that CryptoPunks are compared to a store of value assets.
What are the Use Cases for CryptoPunks?
Primarily used to showcase the digital ownership of a high-value asset.
CryptoPunks can be used to create a community to which only Punks holders have access.
They are speculative assets that can be used to generate profit from third-party marketplace sales.
The prices of CryptoPunks are determined by their rarity. The NFT collection is made up of mostly humans, 6,039 males and 3,840 females. However, other characters are harder to find and have a much higher price point. There are 88 zombies, 24 apes, and 9 aliens, with the latter being the rarest ones in the entire collection. All CryptoPunks have special traits that add to their scarcity, like beanies, Mohawk, cigarettes, and much more!
The numbers for CryptoPunks show just how great this collection is. The overall sales of CryptoPunks add up to 552.24K ETH ($1.66B), the average daily sale is 354.45 ETH ($570.04K), and the most expensive CryptoPunk ever sold, #5822, was sold for 8,000 ETH ($23.7M).
How to Buy a CryptoPunk NFT
To buy a CryptoPunk NFT, you should first have an ETH wallet or a wallet that can hold ERC-20 tokens. Some of the most popular crypto wallets are MetaMask or TrustWallet, and you can download them as a Chrome extension or add them as an app on your phone. Next, you should deposit ETH into your wallet by adding money to an exchange, trading in your FIAT or Crypto for ETH, and then sending it to your wallet. Never use the wallet on the exchange, as it is not safe.
CryptoPunks can only be purchased from the official website (https://cryptopunks.app/) and are not available on the OpenSea marketplace. Instead, connect your Metamask to the CryptoPunks app, and you can place a bid on your favourite punk or directly buy it if it’s listed.
Why are CryptoPunks so Expensive and Cost so Much?
Since its creation, CryptoPunks has become an online status symbol, and a certain prestige comes with owning a CryptoPunk. As one of the early NFT collections, CryptoPunks are viewed as a luxury in the current market, and the fact that they have been minted for free and currently sell for as high as $23.7 million entails that people view them as more than a simple NFT – and instead, they compare it to owning a piece of crypto history.
Moreover, not all 10,000 CryptoPunks are readily available, so their scarcity helps increase their price. The price of CryptoPunks is dictated by supply and demand mechanics, and the price of CryptoPunks is similar to how the price of art in the real world is established.
The first version of CryptoPunks came with a fatal flaw. Larva Labs overlooked an error in the smart contract that governed the purchase of the NFTs. The error allowed the buyer, not the seller, to withdraw the funds after a sale. So a buyer could pay for a CryptoPunk, receive the CryptoPunk, but then withdraw the funds initially put in. So what Larva Labs did was scratch the first version and launch a new set of 10,000 CryptoPunks.
The Future of CryptoPunks
CryptoPunks are an industry symbol and will continue to be one of the leading NFT collections even as the NFT market continues to mature. From the first free mint to a record-breaking $23.7 NFT sale to the acquisition of the IP right by Yuga Labs, CryptoPunks will continue to thrive online as well as offline. Its scarcity and non-conformist look is what helps CryptoPunks maintain its legacy.
No, CryptoPunks are an ERC20 token, just like other NFTs on the Ethereum blockchain.
There are no transaction fees. Collectors only have to pay the gas fee.
Yes, the price of a CryptoPunk depends on the demand for it; if the demand shifts, so will the price.
CryptoPunks are not available on any third party NFT marketplaces like OpenSee. They can be bought only by directly purchasing or placing a bet on an existing CryptoPunk on the official website.