What Does Ape Mean In Crypto

What’southward upwards with all the hype around
Ape Coin? Is yet another meme money being born or is it something different this fourth dimension?

These questions were buzzing effectually my head likewise so I decided to accept a deeper look.

Afterwards reading 16 articles, watching iii hours of videos and listening to more than than 5 hours of podcasts I accept condensed all the noesis about the
Ape Coin crypto token
into 10 sections.

Read on to ace whatever Ape Money related questions in your next Telegram or Discord chat.

1/ten. Ape Coin’due south birth through NFT Mania

If that heading reminded you of “Tulip mania” and so y’all are thinking forth the same lines as I am.

By now almost everyone has heard of NFTs: Non-Fungible Tokens. If y’all have had the slightest interaction with crypto it should conjure upward images of CryptoKitties, CryptoPunks and the Bored Ape Yacht Order.

Image of a crypto kitty
A crypto kitty

image of a CryptoPunk
A Crypto Punk

image of a Bored Ape NFT
A Bored Ape Yacht Social club ape

What does Non-Fungible even mean?

Not-Fungible is an annoying word as it is not intuitive to anybody. Basically it means in that location is zippo that is notionally equivalent. For case, my dollar is equivalent to your dollar, your ounce of aureate is equivalent to any other ounce of golden and my (unopened) coco-pops cereal is equivalent to any other coco-pops cereal parcel on the supermarket shelf.

People wouldn’t heed swapping fungible things because they represent the aforementioned thing and hold the aforementioned utility and value. It won’t matter to me which specific dollar I use to buy stuff. And when I pick upwardly a packet of cereal off the shelf it again doesn’t matter which one, provided that the box is not battered.

Things that are Non-fungible are unique. For example, Picasso’s paintings are non-fungible. Similarly, real estate, diamonds and collector stamps or baseball cards are all non-fungible.

I am going to tell y’all how all this related to Ape Coin and how information technology works presently. But first.

How crypto helped digitize ownership of fine art

With the appearance of crypto we were able to represent coins digitally. Bitcoin was the first and many followed.

I say digitize but its not exactly what I mean. Anyone was able to digitize money. All I needed to do was send you an email proverb “hither, I am sending you some digital money. I am calling information technology MadToken.”

The problem was that there was no substance to that because y’all knew I could as send the same email to many others. This is known as the double spend problem. Bitcoin solved the double spend problem through cryptography and the residual is history.

But if you lot step back and think that Bitcoin kicked off in 2009, it took quite a long time for the states to movement from digitizing fungible stuff like coins to digitizing non-fungible stuff.

And this is where is gets weird. Because in people’s minds art on the cyberspace was fungible. Y’all could easily right click and “salve as” on any image on the net that you liked. You could place information technology as your profile flick, upload it to your blog or impress it out and hang it on your wall. At present, of a sudden, tokenizing that film meant that information technology acquired a unique id proving buying. This meant that it can be owned by a single person. And while information technology can exist copied by anyone, ownership is unique.

If you lot however tin’t get your head around them there is a great article explaining NFTs by the Verge.

Back to what all this has to do with Ape Coin.

2/10. Crypto punks vs. the Bored Ape Yacht Club

In 2021 NFTs became all the rage.

I first became aware of NFTs with the introduction of CryptoKitties. These were office of a game where you lot could buy a digital kitty and mate it with another kitty to breed a new one.

In around 2019 the crypto world was introduced to a new form of fine art chosen generative art. Generative fine art is fine art that uses programming to automate a whole or office of the process. The virtually talked almost generative fine art were Autoglyphs. As you tin encounter they are kind of boring but they were new and that is all that mattered.

An example of an Autoglyph NFT
An Autoglyph

The studio that introduced Autoglyphs to the world was Larva Labs. It is a team of two, now famous, people: John Watkinson and Matt Hall. Their adjacent iteration in generative art was to send giant reverberations across the crypto space and modify the mural as we knew it.

CryptoPunks enter the scene

Larva Labs created these pixelated crypto punks characters that conceptually alluded to the zilch punks who started crypto. The characters’ pixelation matched the blueprint ethos of the raw user experiences of DeFi dapps that were sprouting everywhere. A revolution was being built-in and people did not have time to make things look pretty.

A collection of CryptoPunks
CryptoPunks

CryptoPunks originally emerged as fine art meant to be used for profile pictures. As such, the value of the art is inextricably linked with the emergence of the crypto community that used them. The art meshed well with the values of the anarcho-crypto-punk rebel programmers who were going to disrupt the globe. Without the community and that narrative the pictures would likely have non held whatsoever value on their own.

Crypto punks are the most valuable NFT collections and many of the original holders saw value in both the fine art and the narrative. The aesthetic of the punks has this counter cultural vibe that resonated with the early adopters of crypto.

All in all there are about x,000 punks that are grouped into different categories. You have humans, zombies, apes and aliens. Over time some traits such as hoodies take become more pop.

Other NFT collections also followed forth the same lines. For example, they may have human vs. mutant versions and so hither again the hoodie might be more prominent.

Bore Ape Yacht gild

Many NFT projects tried to become popular like the CryptoPunks. The next NFTs to really take off were the Bored Ape Yacht Gild apes. Like the CryptoPunks these were designed and sold past a design studio. When Yuga Labs first started selling them yous could purchase Bored Apes for a few hundred dollars. Very quickly though prices skyrocketed and now the cheapest Bored Ape is going for a few hundred thousand dollars.

Up until about May 2021 the Punks had been the unchallenged leaders of the profile pic category. The original 9 CryptoPunks, which had this historical provenance value attached them, were trading for effectually $20Mn a piece.

At around this time, Yuga Labs emerged trying to go a foothold in this space. Their fine art ended upward becoming pretty popular.

According to an interview with NFT connoisseur punk6529 at that place are a few things that Yuga Labs did differently:

  1. They had a low minting toll of 0.08 ETH. Previously other collections were minted at escalating prices that ended upward annoying early adopters.
  2. People liked the art. It was more fun but also more mass market place. Camps on either side quickly formed. Those supporting the crypto punks, the Original Gangsters, thought the Apes looked kitsch. In contrast, the Ape’s distinctive aesthetic resonated well with those of an opposing view.
  3. Yuga labs was very clever or lucky because their apes were endorsed by celebrities. Anyone from musicians to athletes were purchasing them like hot cakes for astronomical prices: Madonna, Paris Hilton, The Rolling Stones, Snoop Canis familiaris, Jimmy Fallon, Steph Back-scratch, Serena Williams, Alexis Ohanian just to name a few. If CryptoPunks are the Stradivarius Violin of the mod era, Bored Apes are its Rolexes. A Stradivarius violin has historical provenance value attached to it. Rolex on the other mitt is a professionally managed brand. Heavy advertising and sponsoring of celebrities is what builds the brand narrative.
  4. They have their own Money called Ape Coin which you will exist able to use to purchase these NFTs. I am going to tell you lot more near this later.
  5. The Bored Apes drove conceded IP rights to the token holder

Permit’s explore this concluding betoken considering it is important.

When you lot recollect of art, almost all of it operates nether the model where the artist retains the copyright. If y’all buy a Picasso painting it does not mean he has transferred the copyright to yous so that yous can print t-shirts. Similarly, if yous purchase a Star Wars movie y’all do not own the franchise. Nigh NFTs follow this model.

Yuga labs broke away from this trend. When yous buy a Bored Ape y’all ain the copyright to that ape. This means you can print t-shirts or commercialize it in whatsoever way you lot desire. For example, people have placed their ape on a microbrewery, on a coffee brand and as their DJ logo. There is fifty-fifty a virtual band that has used 3 apes to represent themselves. Copyright buying was a key factor in helping the bored apes intermission abroad from thousands of other collections.

Take notation of how the Yuga Labs team are much more strategic in the way they execute and how they accelerated the brand compared to the ii rebel designers at Larva Labs.

What about the crypto punk IP condition you may inquire?

Larva labs never appear what the condition is around CryptoPunks’ intellectual holding. They did however issue clarity on another NFT collection of theirs: Meebits.

Collection of Meebits NFTs
Meebits

Meebits was another collection from Larva Labs that was gifted to CryptoPunk holders. If you had a CryptoPunk y’all got a Meebit.

The Meebits controversy

When they launched Meebits, Larva Labs announced that they owned the copyright to Meebits which meant no 1 could commercialize them. While few CryptoPunk holders are likely to have wanted to commercialize (they are thought to be mostly rich and more ideological), the restrictive corporate commercial rights policy clashed with the values of decentralization. Here were these programmers who were building open decentralized systems without centralized intermediaries and at present a corporate company was restricting their right to use their cultural symbol.

To offer some course of appeasement in that location was a clause in the copyright that allowed you to commercialize up to $100K per yr provided information technology was non digital commercialization. Effectively, they were maxim yous tin impress t-shirts and baseball caps for your family and friends. Punks saw this as an insult:

  1. No 1 starts a business that will have an upper ceiling of a hundred m a year and
  2. The whole signal of NFTs is that they inaugurate this digital revolution. What’due south the point if you cannot digitize?

The fact that Larva Labs never clarified their position around CryptoPunks simply irritated holders further. They criticized Larva Labs for lack of transparency. People wanted to know wether CryptoPunks would be issued commercial rights or public domain rights.

4/ten. Yuga Labs acquires Larva Labs: what does this mean?

On March 11th, 2022 Yuga Labs announced that they had acquired Larva Labs. People had mixed feelings most the acquisition.

On the one hand, the CryptoPunks, who represented the counter-civilization, were being captivated into the mainstream. Yuga is non a two person studio. On the contrary, Yuga is poised to become a commercial behemoth in the NFT infinite and across.

On the other hand, Yuga Labs announced they would exist placing CryptoPunks nether the same license as the Bored Apes effectively issuing commercial rights to punk holders. This was not bad but at that place was no ane more annoying that could have done this than Yuga. The punk community had this immortal historical provenance narrative and all of a sudden the Bored Apes, whom punks condescendingly looked down upon as a fashion business, freed them from their shackles.

The acquisition has shifted the punks’ narrative. Information technology is ane matter to exist the original gangster and another to be the fourth largest collection in a conglomerate backed by VCs. What if Facebook or Disney larn Yuga Labs ? These guys practise not want to sell out and become some punks’ game in the metaverse. This is kind of equivalent to an underground band going mainstream: “they sold out man”.

On the flip side the punks are now in control of their own destiny. They can ring together if they want and build a new narrative.

Hey, random plug hither, only if you are interested in trending coins there is a weird one called CLM coin that people are searching for correct now. Only click on that link to discover out more.

Moving on.

five/x. Commercial models

The biggest difference between Yuga and Larva is that Yuga is mode more than valuable. They accept 100% gross margin from royalties: they own 5% of every Bored Ape. So whatever commerce arises from Bored Apes they go 5%. Imagine every time a Bored Ape trades on Open Body of water (largest NFT market place) they get 5%. This means that Yuga Labs has a multibillion dollar valuation: $4Bn to exist precise. At this valuation they were able to raise $450Mn from VCs and buy Larva Labs’southward stock of punks also as the rights to their intellectual belongings.

The fundraise was led by a16z (the Andreessen Horowitz venture capital company) and included Animoca Brands and others. These are big names.

Larve Labs have very expressly said they do not want to become a big concern. They wrote history by introducing the world to NFTs every bit profile pics and as generative art. But they consider themselves artists and cutting border programmers rather than business people.

half-dozen/10. The leaked slide deck about Ape Coin

Shortly afterwards the sale, a Yuga Labs deck “accidentally leaked”. Given the quality and completeness of the slide deck many view this equally a PR stunt. Wether information technology was a genuine leak or not the results is that it helped with publicity.

Yuga Labs Slide deck summary

The deck is xc slides and so hither is a quick summary

  1. The Yuga team is professional. Its 46 staff are all ex-Google, ex-Facebook, ex-Twitter etc.
  2. They will aggrandize IP either in-house or via acquisition and have big plans for gaming, a metaverse etc.
  3. They have a successful community with cultural significance and celebrity endorsement. Yacht parties, treasure hunts, and online-games reinforce this sense of belonging.
  4. They are big. 10% of sales on OpenSea = $15Mn per day in 2022 then far.
  5. The future is metaverse. What others are building is underwhelming. What nosotros will build will be dissimilar.
  6. In their metaverse you lot will be able to own country and NFTs, clothes your characters and build stuff (basically what all metaverses do). They volition also have an SDK for anyone to build in their metaverse. An SDK stands for software development kit. Finer, they are saying they will be a platform where people can build stuff.
  7. For all of this to come together they will innovate a new coin chosen
    Ape Coin
    which will exist their metaverse’s currency .
  8. They introduce their metaverse: A new set of characters called Kodas, a catholic creature, give birth to the Apes.
  9. They will launch with a land sale of 200K plots. They will outset with 100K plots at 1 ETH. 30% of these plots volition go to Ape holders. Some country parcels volition have extra goodies. You might even find a Koda hidden inside (5% hazard).
  10. Last year their internet margin was $127Mn because they go a cut whenever someone buys / sells a Bored Ape. In 2021, the total sales from Apes changing hands exceeded $1Bn. In 2022 they expect to make most $455Mn primarily through the sale of land.

7/10. Ape coin explained

Ape coin volition be a combination of payment token and governance token. It is an ERC-20 currency, i.e. it uses the Ethereum network and will be Yuga world’s currency .

Ape money’due south price was ~$vii when information technology launched. The fully diluted value of Ape Coins equally of March 2022 is already at around $11.5Bn. This sounds crazy just then on the other paw we have entered a zone of speculation nearly the futurity: metaverses, gaming etc. No one really knows what all this is going to look like.

A lot depends on the execution of Yuga Labs and and so far it looks as if they know how to execute. Of course information technology is one affair to effect and create a buzz effectually a set of NFTs and another to build a new metaRPG (role playing game) game that no one has done all the same. If successful then the services and in-game sales that require Ape Coins would create a base of operations layer of buying force per unit area. Nevertheless, the fact that they are selling land without even having the metaverse ready is kind of like Disney selling season tickets without having laid a unmarried brick yet to build Disneyland.

BTW if you are interested in the gaming attribute of Web3 cheque out my deep-dive into Genopets, a move to earn game where y’all can convert you steps into tokens.

The question therefore is whether Yuga will become the Marvel or Disney of the digital era.

Ape money has the following 4 uses

  1. It is the primary currency in their metaverse game:The Otherside. Y’all can use it to purchase state, NFTs then on
  2. Information technology acts like a governance token that y’all can use to vote on DAO decisions. More than on the DAO afterward
  3. It seems like in that location are discussions on Discord around being able to stake your Apes for Ape Coins
  4. It’s a currency. You tin already utilise Ape Money to purchase Merchandise like t-shirts from Yuga Labs. Y’all can also use Ape Coin as in-game currency for Animoca Brands’ game: Benji Bananas. What’south more interesting is that TIME magazine have announced that you can purchase a subscription with Ape Coins. I judge this is a PR motility rather than a outset step to become a mainstream currency.

Tokenomics and Ape money distribution

Ape Money supply is fixed at 1Bn. On their website Ape Coin say that this supply is impossible to increase through the current smart contract that they utilize on Ethereum to mint this coin. Similarly, supply cannot be burnt. So fixed supply means there can be no inflation or deflation.

Ape Coin token distribution
Ape Coin distribution

The tokens are distributed as follows:

  • 47% volition go to the DAO treasury and resource. Not sure what “resources” means here.
  • 15% goes to Yuga Labs.
  • 8% goes to the 4 Yuga Labs Founders.
  • 14% goes to the VCs & people who helped brand this happen. I assume that ways VCs again.
  • 1% goes to Clemency: the Jane Goodall Foundation.
  • And finally xv% is airdropped to electric current Bored Apes holders.

Ape holders received the airdrop at launch. The residual of the coins vest over fourth dimension, the maximum being 48 months.

8/10. Early criticisms of Ape Coin

Ape Money is issued and managed by the Ape Coin DAO. This technically is not supposed to have anything to do with Yuga Labs. It is a split up decentralized entity that holds the IP rights to the Ape Coin logo and manages decisions around minting and other community related concerns. Ape Coins holders can use their coin to vote on DAO decisions

Criticism on decentralization

This is where things get a piffling murky and where Ape Coin comes under criticism. The DAO is supposedly decentralized only effectively information technology isn’t. Every bit you could see above the VCs and Yuga Labs currently can band together to enforce whatsoever determination they see fit. The Ape Money Foundation executes the DAO’s decisions. This is a common in crypto. Because DAOs are not a legal entity they need a Foundation that will manage things for them.

The Ape Foundation Board comprises some very impressive names:

Profile pics of Ape Coin Foundation members
The board of the Ape Coin Foundation

  • Alexis Ohanian is a Bored Ape collector and i of the founders of Reddit. In instance y’all care his wife is Serena Williams.
  • Amy Wu is a renowned name in the crypto infinite and is caput of Gaming and ventures and FTX, one of the largest crypto exchanges.
  • Maaria Bajwa is principal at a VC.
  • Yat Siu is one of the founders of Animoca Brands which is a big bargain.
  • Dean Steinbeck is President of Horizen Labs which is a blockchains services visitor.

Criticism on SEC status

Another criticism of the whole set up is that Yuga and its investors seem to accept been very deliberate about the status of Ape Coin. It has the narrative of decentralization which puts it in a gray zone every bit far as the SEC will authorize Ape Coin as a taxable security or not. We will see how this evolves just the strategy is articulate on this one. This verge commodity is pretty good at explaining the potential scrutiny it could come nether.

A final aspect that has added a slightly negative camber to the Ape Money story is the hack that occured shortly after the launch.

9/x. The $1 Mn Ape coin Hack

New coins or blockchains are oft accompanied by some controversy. In the case of Ape Money, “hack” is probably not the most appropriate discussion for what happened. Rather information technology’s more like someone taking advantage of a glitch. I leave it to you to decide whether this this is brilliant or unacceptable.

Every bit described higher up the Ape Coin launch happened by distributing Ape Coin tokens to Bored Ape owners. So, for example, if you lot had a Mutant Ape you lot got 2042 Ape Coins. If you had a Bored Ape you lot would take received 10,094 tokens. At today’s toll that is about $130K. Imagine: if yous had bought a Bored Ape, the cheapest of which is $300K you would now have an additional $130K.

How the hacker used a Wink loan to their advantage

You are probably enlightened that you tin buy and sell NFTs on various platforms. NFTx.io is one such platform. On NFTx.io yous can have your NFTs and put them into a vault and securitize them into a token that you can sell. At the fourth dimension in that location were five Bored Ape NFTs worth $i.5Mn in a vault on NFTx.io that had not claimed their Ape Coins yet.

Someone bought their ain Ape Coin for about $300K. They then used this as collateral to take out a loan. With the loan they purchased the 5 Apes. They and so claimed the 60K Ape Coins airdrop that belonged to the 5 NFTs. At that fourth dimension that was a little over $1.1Mn. They then paid back the loan. This process happens instantly in a smart contract known as a flash loan (because information technology executes immediately).

There is a lot of argue on social media wether this was theft or not. Technically it is not. It is like me lending you a tool and then you using information technology in a clever way. If I am lending yous the tool so it should not matter what you lot do with it. On the other hand the intent of the airdrop was that information technology goes to Bored Ape owners rather than flash loan borrowers. So maybe the Bored Ape Foundation / DAO could take washed a better job on deciding under which weather you lot could merits the airdrop.

Andrei Jikh has a bully video explaining the Ape Coin hack in detail if you want to take a closer look:

Video explaining the Ape Coin hack

ten/10. Ape money state sale

On the 30th of April 2022 Yuga Labs initiated their state auction.

This didn’t get likewise well.

While there were 55,000 plots on sale there was need for 200,000 plots. Looking dorsum, a cardinal reason was the toll. At the fixed price of 305 ApeCoin (which was about $half dozen,000) per plot, demand far outstripped supply.

While initially Yuga had appear that they planned to use a Dutch sale to sell the land they inverse their minds at the last minute. The reasons for this aren’t entirely clear.

What is a Dutch auction?

In a Dutch auction the seller quotes a price ceiling and starts moving downwards in increments. This style people volition only buy at what they think is the off-white price.

What went wrong with the Ape Money land sale?

Remember that everything is happening on the Ethereum Network. In gild to transact on Ethereum yous need to pay gas fees. So if you have ApeCoin in your wallet and y’all want to commutation this for an NFT representing a virtual plot of country, so you need to pay gas fees.

What happens when in that location are many people waiting for their transaction to become through?

Why, people tin pay a college gas fee to get their transaction to move to the front of the line and get processed faster. This is similar to traveling business class on a flying.

Considering need was so high, buyers ended up paying more in gas fees (nearly ii-3 ETH) than they did for the actual NFT.

All in all Yuga is thought to have raised nigh $300Mn while people spent ~$500Mn.

That is a whopping $200Mn wasted.

What else you should know about the Yuga land sale

In order to purchase land users needed to KYC. KYC stands for know-your-customer and is a common abbreviation used in banking.

In essence Yuga wanted there to exist a way to connect wallets to a living person.

Some have said they wanted to avoid bots from front running (a kind of crypto hack) annihilation.

This did not go down well with the ApeCoin audience whose Web3 spirit is closely tied with the desire to remain bearding.

The plan was for people to be able to purchase merely 2 plots.

Ouh! What happened with the Kodas

Those who were lucky got some Kodas with the land they purchased. Normal Kodas were trading around $threescore-90K. In that location were as well 100 “mega” Kodas , i.e. rarer ones, that traded in the hundreds of thousands of dollars.

ApeCoin Koda
A koda. Source: arover.internet

What’south next for Yuga land sales

Yuga has announced that they are thinking of building their own concatenation rather than rely on Ethereum. It remains to be seen if this is a good solution or not.

A further development that people are waiting is the announcement well-nigh the game pattern and rules. Right at present it is not clear which type of plot is strategically more than valuable. Similar any game, metaverse projects will accept a while to materialize. Once the game emerges nosotros can expect a swap between those who bought to flip their investment and those who want to play the actual game.

Wrapping upwards Ape Coin

I don’t call up we volition achieve a phase where people volition shout the emperor has no clothes. Clearly there are many who, when they step into this world of multi million NFTs, think information technology is ridiculous.

The flip side of this view though is that NFTs such as CryptoPunks and Bored Apes are here to stay: they have a cultural narrative and significance that is digital. This gives information technology a lot of flexibility in terms of how things might evolve. If Yuga Labs and their experienced VCs execute well then Ape Coins will become a substantially important currency in the crypto space.

BTW you tin can too bank check out how to buy Ape Coin and the ape coin contract address.

Please share of yous liked this and sign upward to my newsletter. Thank you for reading!

Source: https://elementalcrypto.com/ape-coin/what-is-ape-coin/

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