‘Blue chip’ NFTs spring back to life as CryptoPunks double in value

The cheapest CryptoPunks now trade for around $112,000. Credit: mundissima/Shutterstock

Even CryptoPunks are surging.

The prices of arguably the most popular NFT collection ever have more than doubled in recent weeks amid a broad-based rally.

The cheapest CryptoPunks now trade for around $112,000, according to NFT Price Floor data. This gives the collection a market value of at least $1.6 billion, although rare examples from the collection trade hands for many times more than the cheapest ones.

The price jump shows that there are still plenty of NFT collectors around despite the asset class being trapped in a multi-year bear market, Nicolas Lallement, co-founder of NFT data platform NFT Price Floor, told DL News.

“[They] were waiting for the right entry, trying to catch the bottom, and now, fearing to be sidelined, are pulling the trigger,” he said.

NFTs, or non-fungible tokens, are a type of crypto asset. Because they are non-fungible — a technical term meaning each token is unique — they are often used to represent art, music or collectibles.

The surge may only just be beginning.

According to Lallement, traders may be positioning themselves ahead of a potential “violent repricing.”

If it is the start of a renewed interest in NFTs, the market still has a long way to go before it retraces the heady prices of the previous bull market.

At the collection’s November 2021 peak, CryptoPunks traded hands at a $417,000 floor price. Even with the recent jump, CryptoPunks are still 73% off that all-time high.

High volume

Demand for NFTs soared in late 2021 after Bitcoin surged some 1,140% the year before.

Many who made money in the rally piled into NFTs to flaunt their wealth. But as the market crashed in 2022, so did almost all NFT collections.

Now Bitcoin has soared to all-time highs, some of the newly-created wealth could be flowing into NFTs again.

“The last week has been the highest volume we’ve seen in years,” Punks OTC, a pseudonymous NFT trader who runs a popular over-the-counter NFT trading desk, told DL News.

Over the past week, there have been 189 CryptoPunks sales totalling $23 million, a 166% increase from the week before.

Many NFT collections like CryptoPunks only have a limited supply, usually of around 10,000 tokens. Because they are relatively illiquid, it only takes small changes in demand to create large price swings.

Punks OTC also noted that the CryptoPunks community on social media is growing more rapidly than at any time since 2021.

Trickle-down effect

Although CryptoPunks are the biggest gainers, they’re not the only NFTs rallying.

The price rise has created “a clear trickle-down effect into other collections,” according to Lallement, who said that CryptoPunks “often act as a leading indicator for blue-chip NFTs.”

Bluechip is a stock-market term for the most reliable and valuable companies on the market. In crypto, traders use the word to describe tokens or NFTs they consider to have established value.

Lallement gave the example of the generative art collection Chromie Squiggles, which has seen its floor price almost double since November 11.

Other collections regarded as blue-chips, like Pudgy Penguins and Milady Maker, are up 89% and 103% respectively over the past two weeks.