Blockbuster M&A in the NFT Market
On March 11, it was announced that Yuga Labs, the creators of the famed NFT project Bored Ape Yacht Club, would acquire the second most traded (by volume) NFT project of all time — Cryptopunks.
The deal represents one of the largest M&A transactions in crypto to date and places Yuga Labs at the forefront of the race to create original intellectual property (“IP”) in the NFT space.
While transaction details were not disclosed, the combined sales of Bored Apes, Cryptopunks, and Meetbits (the other project acquired in the deal) have accounted for ~$4 billion in sales.
The transaction not only marks an important consolidation but also a shift toward distributed IP. Yuga Labs announced that it would immediately be distributing commercial rights of the Cryptopunks and Meetbits to their holders — something that had long been a point of contention.
Yuga Labs has been rumored to be in fundraising talks over the past several months but has not made any official announcements. The rumors, however, indicate that the valuation could be as high as $5 billion.
The NFT Market has Cooled Considerably
The news is not all good for the NFT market. Daily trading volumes on OpenSea — the biggest NFT marketplace — are down 80% in March from their peak in February. The average selling price of NFTs and number of accounts buying and selling NFTs weekly have also dropped, according to NonFungible.
The market’s slump is raising questions about the long-term outlook for NFTs, which saw $41B in sales and an explosion of VC investment in 2021.
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