If 2017 was the year of the ICO Wild West Gold Run, 2021 was the year of the NFT. It not only became the Collins Dictionary word of the year, NFTs became the new darling of the brand and advertising world. And last year saw $21 billion USD sales of NFTs.
On the back of the NFT craze, emerged a new spin off, the PFP (profile picture) NFT, limited edition NFT collections which created relatively large communities; quickly, and created a sense of FOMO as avatars started to pop up in place of arty headshots or carefully posed “casual” snaps as social media profile identifiers. Twitter has been quick to react by adding a verification mark to such profiles which clearly demarcate those who are in, from those on the sidelines.
Yet, just as we saw in 2018 with the ICO market crash, there are signs that 2022 could mark a similar bubble burst. There is unrest around cynical project pile-ins that seek to capitalize on this newest craze, but lack the fundamentals to support ongoing growth or development. With such a new market sector, there is a huge risk that supply will overwhelm what is still, at heart, a relatively limited demand.
If you bought into the Bored Ape Yacht Club early, Congratulations. You basically got bitcoin when it was worth less than a dollar. The sheer size and scale of the Ape community now will insulate it from any bear market in the long run. But if you are still looking for the right project to join, how do you pick something that is more than a Twitter blue check, but more like a blue chip investment.
One of the newer PFP projects emerging from Central Europe, Fancy Bears, is aiming to do just that and differentiate itself from the pack with a laser focus on growing its community and making it the most democratic project in blockchain. In its January pre-sale, all 8,888 bears sold out in less than eight minutes. And if you bought early, enjoy some BAYC-style smugness as a browse through OpenSea shows the floor value increasing week by week, in contrast to many other PFP projects.
At first glance, with talk of yacht parties and supercar giveaways, it might seem a little “when LAMBO?”. However, digging into the project it soon becomes clear that those first impressions mask a more ambitious set of objectives.
Central to this is their commitment to reinvest proceeds from their DAO fund into development of the community - which includes athletes, celebrities and influencers. They have the lofty goal of using a 3D scanner to beam all holders (and the Bears) directly into the Metaverse where they can join in parties and other events virtually AND meet IRL at biannual Fancy Bears parties where real world rewards are distributed.
Fancy Bears is making a conscious effort to create a community of holders, rather than flippers with significant benefits for those playing the long game. This might range from merchandise personalised with your own Bear if held for six months or more, to a share in the 30% of royalties from the fund paid out each year.
The team behind Fancy Bears make no secret of their desire to (pardon the pun) ape the success of more established US projects - even down to the creation of its own currency token, Honey Jar, which has similarities to the Serum made by the Bored Apes. This will, in the first phase, allow holders access to its app to upgrade and trade elements and to add value to their Bear through further customization. In further phases, it will add vesting and staking, eventually creating their own decentralized financial ecosystem.
Rather than attaching to a Gold Standard or other centralized governance, Fancy Bears empower its holders as decision makers - from which projects to invest in, to where the next IRL event should be held. By giving holders such a degree of control it starts to veer from merely being digital art into gaming territory - where no decision is wrong, but not all decisions are winners. This puts the future of PFP communities directly in the hands of holders, who have a vested interest in succeeding. Combined with the inherent loyalty and sense of membership in a tight community, it is projects like Fancy Bears that will survive any market crash and thrive as only projects with real underlying value come to the fore.