Letter 15 - On the stigma of selling out

and why a 'slow burn' might be better

Before we dig into the Letter, I want to take this space to share an exciting project that has been in the works for a while. My friend Jaime and I have been busy creating a podcast on NFTs and the first episode got released yesterday. The podcast is called Two Bored Apes and you can check out Episode 1 - Alpha by clicking here or searching for it wherever you normally find podcasts. We hope you enjoy it and would thoroughly appreciate any subscriptions or reviews :)

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A big thanks to twitter user XadeX for the topic suggestion for this Letter.

They make a great point, and I agree 100%. There is certainly a stigma in the minds of many where a project is considered to be a failure if it doesn’t instantly sell out. This is evidenced by the fact that almost any time a project is open for minting but hasn’t “sold out”, people will panic and start to list their NFTs for sale on the secondary market at less than the mint price.

I think this perception is bad for the space in general, and bad for the individuals who overlook projects that are selling out slowly as many of the most successful projects we have seen took weeks or months before minting out. Even worse it is bad for the projects that struggle to sell out, especially if it means an otherwise fantastic project might be dead before it even got a chance to showcase what it was capable of.

You might say “well if the project was really that good, it would sell out”. Yes and no. The NFT space is not a pure meritocracy. Often what makes or breaks a project is a combination of 1) the actual merits of the project, 2) the right people shilling it on twitter, 3) FOMO, and 4) some sort of x-factor lightning in a bottle that nobody can predict.

In this Letter I am going to look at a few very successful projects that did not instantly sell out, and then a look at a few projects open for minting that are currently selling out slowly and might be worth some consideration.

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Punks Comics

Undoubtedly one of the most successful NFT projects ever, Punks Comics launched on May 10th 2021 and were available to mint via their website for over a month before finally selling out on June 15th. I think part of the reason for the slow sell out was the complexity of the project (a common thread we will see through these projects), part of it was the high(er) mint price (0.2) and part of it was insane gas during the first week or two of the launch.

All of the above probably turned some people off from the project and they didn’t give it another look until it was “too late” and they had sold out and the secondary market soared. Obviously most projects won’t capture the same insane success of Punks Comics, but it is a shining example of how there can be amazing value right under our noses available to mint and it can be overlooked by most.

Here’s a spreadsheet I posted in my Letter on Punks Comics from less than a month ago:

Even the aggressive valuation is lower than what the market has deemed them to be worth. The Mint Pass alone is going for between 2 and 2.5 ETH. Insanity.

Avastars

Another complex project, and another one where minting was open for weeks/months. They released five different Generations, each consisting of 5,000 Avastars, and only after a previous edition had sold out did they open up the next one for minting. The most recent Generation sold out only a couple of weeks ago, and for the longest time anyone could go to https://avastars.io/ and mint an Avastar.

I’ll be honest and say that I don’t really understand how the whole Avastar ecosystem works. It is complex and rather than trying to understand & explain something I don’t fully grasp, I will point you to a fantastic article that does a better job than I ever could: The Collector’s Guide to Avastars.

The cheapest Avastar you could mint cost 0.07 ETH and they were available on the secondary market for around this price or just lower for a long time also. The current floor on them is 0.30 ETH and given the provenance of the project I don’t expect we will see prices do much other than go up only in the long run.

Blitmap

Here’s a project that I do understand and have been in love with since day 1. It’s yet another somewhat complex project that required a bit of time to understand & mint, and took a long time to sell out. For perhaps two months anyone could have gone to their website and clicked a few buttons and paid 0.1 ETH and received a Blitmap NFT.

It wasn’t hyped or shilled and they basically had organic growth and sold out as more people discovered and fell in love with the project. This has the effect that those who did take the time to research and buy a Blitmap were not looking for some short term cash grab or quick flip, but they actually loved and believed in the project - meaning that they were not (and still are not) willing to sell their Blitmaps for cheap on the secondary market.

This resulted in an almost immediate floor of 2.5-3x mint price once they sold out. The floor sat there again for weeks without much movement. The mark of an incredibly strong project and community is when the floor can remain solid despite low activity. It essentially means that none of the holders are undercutting each other and looking to exit their positions, and that if someone new wants to get involved they essentially have to “pay up”.

That price was 0.25 to 0.45 ETH for a long time. It is now between 4 and 5 ETH. The team continues to build, deliver, and promise bigger and better things. Given their ability to deliver so far this just further excites the market and makes everyone (myself included) more and more bullish on the project.

One of their first promises which they are close to delivering on is their take on the avatar projects craze going on - Blitnauts:

Shortly before completing the collection, we announced an expansion: The Blitnauts.

Coming soon and free to all Blitmap owners, this expansion pack introduces a brand new craftable collection — a faction of sentient robots sworn to locate and protect the Blitmaps, and the heroes of our world.

I own 8 Blitmaps and I am really not tempted to sell any of them, despite 40-50x’ing my initial investment already.

These were open for minting for months.

Bored Ape Yacht Club

Wait, what? Yes - that’s right. The BAYC was open for minting for a week before it sold out. They launched one quiet night, sold a few hundred apes, and then things were relatively slow until a week or so later when people starting falling in love with the project, team and roadmap and the rest of the collection then sold out within a few hours.

Something that is happening more and more is that when a project starts getting some momentum it snowballs and can go from 30% sold out to 100% sold out in the matter of hours, potentially even minutes. This is because a lot of people might like the project but will “wait and see” if other people also like it and only when they see the demand do they decide to jump in. This is a double edged sword - on the one hand, if you are there when the ball gets rolling, it’s often a great project to get in on. On the other hand it is very easy to miss when lightning strikes and all of a sudden a project you were interested in can sell out while you’re sleeping.

This still happens to me sometimes, but I am getting better at just biting the bullet and minting from projects I think are cool and have a good team and roadmap and hoping that the rest of the community will catch up and appreciate the project eventually the same way that I do.

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Okay so there are some examples of projects that took a while to sell out and have been wildly successful. This is a good point for me to pause and say that these are still the exceptional projects. There are plenty of projects that struggle to sell out and do not go on to be smashing successes. There are also plenty of projects that do sell out and still are not very successful. There is a heavy element of survivorship bias in my selecting the above projects. I did so explicitly to highlight the potential that projects have, not to suggest that every or even most projects that are open for minting ought to be minted. I really just want to try and alleviate the stigma behind projects not selling out by showing some examples of how that did not hurt the project, and perhaps give everyone the thought to look twice at some projects still open for minting. On that note, let’s take a look at some.

My listing these projects here is not an endorsement of them. I just found a few that I think are interesting and worth looking at. The chances of all or even any of them being as successful as the above projects is far from guaranteed. You should do your own research and decide for yourself whether you like what the project is offering, if you like the team involved, their roadmap, and their ability to deliver so far. Anyway, without further ado…

Wannabes Music Club

Wannabes Music Club Avatars is a collection of 10,027 NFTs representing characters from arguably the biggest, warmest, and most vibrant community in the world - the music community.

Avatars drop, however, is only the first step on a big journey we have in mind with Wannabes Music Club.

Buying a Wannabes Music Club NFT you get a scarce piece of digital art and access to the unique community and community-only activities, such as music-related collaborative visual novel game, community talks and masterclasses with successful musicians, music contests to find friends and create together, and even community Metaverse Music Festival.

This project looks, for lack of a better word, cool. It’s not just a dumb animal avatar project - there’s plenty of work that has gone into creating the universe and their roadmap looks promising. I own zero, but I am probably going to talk myself into minting some at some point soon.

Pork 1984

The PORK 1984 is a collection of 9840 unique Pork NFTs who live on the ETH blockchain in a society where the government prohibits self-expression and plugs a patch for everyone who tries to do it.

Every PORK has unique traits, names and titles, and also hidden traits such as: preferences, character, penalties and hours at work on the Factory.

Our plot is based on a Novel “1984” by George Orwell. Thematically, Nineteen Eighty-Four centres on the consequences of totalitarianism, mass surveillance, and repressive regimentation of persons and behaviours within society.

Every current holder of the original handcrafted SVINS collection will receive a PORK 1984 NFT for free. Holders of 10 — up to 3 free PORK 1984 NFTs. Ownership includes all creative & commercial rights of your Free Pork.

Okay so this is an animal avatar project. I minted some yesterday and literally the only real reason is that I like the person behind it - ‘HARTMAN’ or @hartman_artist. He’s been working on his previous project SVINS for months and hustling and doing what it takes to make it successful for him and the holders of the project, so I expect he will do the same for Pork 1984.

Stereo Headz Music Club

The StereoheadZ Music Club is a community formed around the love of music. Our mission is to connect like-minded creatives and assist the creation of new music, art, and expression.

A portion of sales & royalties will be used to establish the SZMC Community Fund & foster the creativity & collaboration of our members.

We are building a social network for SZMC members to easily connect, interact, and collaborate. Our roadmap outlines the initial phases, including a 'corkboard', a social radio station, and an interactive social game.

The SZMC will also host 'Battle of the Bandz' competitions to discover & promote the bands formed by SZMC members.

At the 100% sales mark we will establish the SZMC Music Label to support the discovery, recording & mgmt of new bands. Proceeds from the label will go back into the community fund.

Another music project that seems ‘cool’. They seem ambitious and have some lofty goals - if they can achieve what they are setting out to it would be a pretty fantastic project/platform. If you love music, it might be worth checking them out.

Full disclosure: they sent me 1 for free months ago, basically as just a “hey” NFT, and it was made clear that there was no compensation or advertising expected. I didn’t do any, and am only mentioning them now because they fit into the category of this newsletter.

Mad Cat Militia

In buying a cat you join the militia, gaining entry to the barracks on Discord and benefitting from all the member perks on our manifesto, if and when deployed.

Distribution is fair.

No free cats because you own another collection; no special pricing. One price for all buyers; one price for all ranks and rarities of cat.

Cats will be minted at the point of sale. Allocation is random.

I always intended to mention the MCM because it has always seemed like a cool project to me that has been selling out slowly. Literally 3 minutes ago as I got up to this part of the Letter I saw a tweet about how they announced they will be ending the sale tomorrow and burning most of the remaining cats (don’t worry, in NFT talk this is not as morbid as it sounds).

It’s a pretty good move by them and does not signal to me that the project is failing - many successful projects have effectively burned part of their supply (sometimes the majority) and gone on to do great things. I own none but I am going to be mighty tempted to do some minting tonight. The only thing that has held me back is that it seems like in order to ‘get the most out of it’, you need to be active in the community. It seems fun but I don’t really have the time to dedicate to that at the moment.

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There are plenty more projects out there that I didn’t mention which are open for minting right now. The entire point of this Letter was not to tell you to buy the ones I mentioned, but to hopefully begin to change the narrative and stigma surrounding projects that don’t instantly mint out.

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What’s on my radar?

Junkyard Dogs - This is a project that has been delayed a lot. I think their initial launch was meant to be a month+ ago but for technical reasons they had to push it back. I’m always a fan when a project does this rather than rush to market with a sub-par product. They had a ‘soft launch’ yesterday where they sold 1,888 dogs with a limit of 1 per txn and will have their main launch tomorrow. The current distribution of NFTs per holder is fantastic, with 1,122 unique owners for 1,888 dogs. Full disclosure: the team sent me a “golden bone” NFT a month or two ago. I don’t fully know what it does or gets me and it is not the reason they are getting included in my Newsletter.

Star Sailor Siblings - These seem insanely hyped and are likely to sell out very quickly in a bloodied gas war, as is the norm for projects these days. I’ll be minting some (or trying to!) and probably looking to flip a lot of them. I haven’t done extensive research into the team/project but the little research I have done hasn’t given me any red flags.

Dogs Unchained - To be honest I don’t know a whole lot about this project other than people are talking about it. Here’s what their website says: Dogs Unchained is a community for NFT collectors, dog lovers & IRL dogs on the blockchain (and in the metaverse). Each Dog is an ERC-721 token with deflationary mechanics, and the supply will only decrease from 9,999: through brand new blockchain technology, you can mix two Dogs in the Boom Boom Room, selectively combine their traits, and create a single Superdog. Importantly, members will support dogs through charity when they mint, and also memorialize their amazing IRL canines in the metaverse. I’ll probably be keeping a close eye on them and likely minting.

Monster Blocks - This website is a bit of a refreshing change from the usual project websites. I like the art, I like the tech, I like the roadmap, and I like the team. I’m still not positive it will be a success, of course, but I’ll be minting some.

Galaxy Fight Club - It’s like super smash bros but with our NFTs as assets? Sign me up. This just sounds cool. It’s probably high risk, like any of these projects, and like any project is that gets people to invest in the promise of a future game. But it looks cool enough and exciting enough and has enough thought and work put into it that I am probably going to be minting some.

Art Blocks Curated Drop - Scribbled Boundaries by William Tan. Every ArtBlocks drop is on my radar, with a particular focus on every Curated drop. This one is no different. It looks fantastic and I am keen on trying to pick up a piece or two. Scribbles on Scribbles on Scribbles ➿ This series is an exploration of chaos and order; how seemingly random movements in the minute scale can be more than just meets the eye if you look at the grander perspective. Simple guiding rules transfigure irregular movements into minimal beauty. Life, as we know it, can be expressed in a similar fashion: our decisions, unexpected occurrences, and even our place in the Universe — while it may seem void of any meaning — may not just be a mere coincidence, it is collectively purposeful and beautiful.

The Glue Factory Show - This one is different because it has already minted out - but since the current price on secondary is fairly close to mint price, and since I really freaking love the project and what they’re building, I am looking to spread a bit more awareness of it. I minted 70 of the damn things, that’s how much I like it. Two of the things that sold me on it were 1) the talent they have working on the show is great and 2) the trailer made me laugh. It’s like a budget version of Stoner Cats, and while I like Stoner Cats (and own some), I like this show and project more from what I’ve seen already (for starters their launch was smooth and not the dumpster fire that was the SC launch). I’m excited to see what they can do going forward.

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In the interests of full disclosure, at the time of writing I own 6 Punks Comics, 1 Pixel Vault Founder’s DAO Token, 5 Mint Passes, 13 Avastars, 8 Blitmaps, 3 Bored Apes, 1 Stereohead which was gifted, 1 Golden Bone which was gifted, 70 Glue Factory Show horses, and 21 Pork 1984 NFTs.

We’re still early.

Disclaimer: The content covered in this newsletter is not to be considered as investment advice. I’m not a financial adviser. These are only my own opinions and ideas. You should always consult with a professional/licensed financial adviser before trading or investing in any cryptocurrency related product.