NFTeasers #8 | 5 top NFT trends to bet on in 2022
Scoreboard | Creepz | Poolsuite | Trends | Crypto Therapy
Welcome to NFTeasers from the Sunday:Drip Society crew. Each week, we explore the wild world of NFTs, from high conviction buys to hypothetical scenarios/predictions for your favorite projects.
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Sunday:Drip members will eventually be eligible for fractional ownership in our DripVault, among several other benefits within our lifestyle brand. Current DripVault value is estimated at 13.43ETH (11.9ETH in NFT assets + 1.53ETH liquid) on cost basis of 1.31ETH.
This should go without saying, but our lawyers would like us to state that all of the content we produce in this newsletter is not financial advice and is for entertainment and informational purposes only. Thank you suits.
On today’s episode, we’ll break down:
Scoreboard + DripVault Trades
Analysis of our past performance
Sold Creepz Genesis, Bought Poolsuite Executive Pass
Trends to bet on:
Web3 picks and shovels
360° digital <-> physical brands
Niche membership based communities
Gaming leveraging new models [P2E, P&E, etc.]
New Newsletter from Kallaway
Crypto Therapy - Daily web3 gold
Here’s a few high conviction bets that we’ve written about on prior episodes on Riot Racers, Galactic Apes, RTFKT CloneX, Shiny Feathers, Gambling Apes and FlyFish Club. The aggregate return is up big. CloneX ripping, Galactic Apes ded.
It was a more active week on the DripVault side.
We came into the week with a total DripVault portfolio value of 9.5ETH.
Selling our Cold Blooded Creepz Genesis Lizard
The big decision was whether or not to hold or sell our Creepz Genesis. Creepz is a P2E game where players initially minted lizards which could then be staked to earn $LOOMI.
$LOOMI could then be used to buy other assets/drops in the game which would increase your staking multiplier (e.g., if you own a lizard + armor + shapeshifter you earn more $LOOMI/day than just the lizard by itself, etc.)
To me, unless the game makers found a way to give the $LOOMI token value outside of the game, Creepz would become a house of cards and eventually crash.
Overnight, our Genesis Creep (which we bought for .069ETH) was worth a minimum of 3.8ETH.
These types of games are tricky. The ones that work, really work, because the community is bought in, everyone holds their OG assets and the tokens compound. Again, time will tell if the team is eventually available to create a sustainable model that doesn’t rely on new drops, but for now, most players could sell their $LOOMI tokens on the way up to take out their cost basis and play with house money.
Unfortunately, I didn’t spend the necessary time required to get up to speed on the game mechanics. Because of that, I was afraid that I would miss the opportunity to take profits and it would crash by the next time I checked.
Lesson learned → when there is hype, spend the time to find out why
I ended up consulting with the Sunday:Drip community and sold for 3.8 ETH.
.069ETH → 3.8ETH is a 54x return in 14 days.
I figured that worst case scenario, even if the project ripped to the moon and eventually crashed, we’d lock in that gain to be used elsewhere.
Unfortunately, just a day or two later, ETH prices cratered and Creepz genesis went as high as a 9ETH floor price. Ouch.
They currently sit at ~7ETH.
It’s hard to know where they will go from here, but we definitely left some money on the table by selling too soon.
We also still have the 7K $LOOMI tokens that we were given for free in exchange for being a part of the special Floor partnership. Those are currently worth ~1ETH.
How to play Creepz from here → Most of the people that I know in the project (including some of our Sunday:Drip members) have taken their cost out and are looking to sell if the project gets too hot. I’d be careful about getting into this one at this point.
Buying a second Poolsuite Executive Pass
With all of that fresh powder in the bank from the Creepz sale (RIP), we wanted to put some of it to good use.
We’re extremely bullish on Poolsuite and think that what they’re building will be one of the first great examples of a hybrid “physical + digital” brand - one that consistently creates products and experiences in both the physical and digital world. We bought that piece for 1.88ETH yesterday and the floor is currently 1.71ETH.
In addition to having two passes to drive double the utility and future claims for our community, we view Poolsuite as a complementary project to Sunday:Drip in the lifestyle brand category.
Our goal is to fully support and form deep relationships with as many of the lifestyle branded projects as possible, especially ones that are trying to tackle the physical meets digital experience like we are.
How to play Poolsuite → Little birdies tell me that there is a lot of dope stuff coming from Poolsuite in the next several months. Tough to say if it will be able to justify a nearly 2ETH price tag, but this is one of the few teams that I trust will be able to execute on their vision
Current Portfolio Value
The portfolio is now valued at 13.43ETH on cost basis of 1.31ETH (9.25x return in ~2 months). We now also have more liquid ETH (1.53) than total invested capital.
With the exception of the Poolsuite piece we bought yesterday, every single one of our investments are in the green.
With hundreds of new NFT projects launching every week, it’s hard to analyze projects on an isolated basis.
It’s gotten to the point where finding diamonds in the rough is not your only challenge…you also have to make sure you’re looking in the “right rough” to begin with.
Because of this, I’ve started thinking more in higher level trends/themes before diving deeper to find individual projects that I like.
This wasn’t necessarily important 6 months ago because it was easy to pick the 1-2 winners out of the 10 new projects each week.
With hundreds of new projects launching each week, it’s now more critical than ever.
The concept of thematic investing is not new…most institutional investors invest in specific slices of the market that follow emerging trends.
For example, B2B SaaS, cloud infrastructure, robotics, AI and even the metaverse were all trends that were the focus of institutional money for the past 5-10 years.
Here’s a few trends that I am super bullish on in the NFT space:
Female-led/influenced communities (e.g., BFF, World of Women, Crypto Coven, etc.)
Web3 picks and shovels (e.g., Thirdweb, Supersea, Floor, Bildr, etc.)
360° digital <-> physical brands (e.g., Poolsuite, Sunday:Drip, RTFKT, etc.)
Niche membership based communities (e.g., Shiny, FWB, Recess, Proof, etc.)
Gaming leveraging new models [P2E, P&E, etc.] (e.g., Riot Racers, Crypto Raiders, etc.)
I’m going to quickly break down my thoughts on each below…
1. Female-led/influenced communities
Two nights ago I watched a live-stream on YouTube called BFF Minted. It was an event hosted by 50+ female leaders across a variety of fields and included celebrities Mila Kunis, Tyra Banks, Gwyneth Paltrow.
The event was 90% attended by women interested in learning more about crypto/NFTs and was fantastically executed. You can watch the reply here 👇
Given the lopsided adoption of crypto to this point (96% of wallet owners are men), it seems likely that we’ll see a reversion to the mean over the next few years with many more women jumping into the space.
When that happens, look for female-led/influenced projects to gather steam. Early projects leading the way in this vein are World of Women (9.5ETH floor) and Crypto Coven (2.25 ETH floor) as well as several others shared during the event.
The BFF project is actually offering whitelist for their upcoming mint in March. To take advantage, anyone can text “Minted” to 415-301-4490. It will text you back and if you click the link, you can click through to their typeform and enter your email and wallet address. It should be open until Friday night at ~4pm PT. I believe they will draw 10K names for the whitelist from those who sign-up.
2. Web3 picks and shovels
Picks and shovels is a common framework used to describe the tooling or platforms that enable creation/consumption in a space. The term comes from the 1840s gold rush era that describes all of the businesses that sold equipment and materials to those mining for gold.
Many miners went broke looking for gold but nearly all of the widely adopted picks and shovels businesses thrived.
I think the same logic can be applied to the NFT space.
In my mind, the types of picks and shovels businesses that will thrive include things like ThirdWeb (a platform for no code web3 development), Moonpay (enables fiat payment for NFTs), Bildr (no code web design with web3 integration), Supersea (a helpful plugin for navigating OpenSea) and Floor (NFT portfolio app and floor tracker).
Often times, investing in these projects requires the purchase of an NFT membership pass (which enables free use of the tools for life) or tokens that map to governance/ownership of the company or protocol.
3. 360° digital <-> physical brands
Over the next few years, most established brands will do their best to make a play in the NFT space. And for good reason!
NFTs are 99% margin and require little upfront investment to deploy. With hundreds of thousands of customers or millions of followers on social media, selling out these early collections should be a breeze.
But my hypothesis is that this type of strategy won’t translate well to a sustainable 360° brand model - one that blends physical and digital offerings seamlessly.
Most brands have long since figured out how to sell physical products in physical stores, and in the last decade, built solutions for selling physical products digitally. Creating digital products that matter is a whole other ballgame.
The theme I’m most interested in is with brands that are primarily digitally native and more or less born on web3 rails from the beginning.
If you’ve been following Sunday:Drip from the start, it’s no secret that this is how we’re positioning the brand. We believe that a web3 technology layer and community-driven development will create incentive dynamics and networks effects not previously seen in lifestyle brands. We’re betting heavily on it.
For now, because there are so few “web3-native” brands, the way to play them is to buy their membership pass and/or support all early collections they release. RTFKT showed a model where free to claim drops earned early supporters thousands of dollars in future CloneX mint passes.
4. Niche membership based communities
While most PFP projects feel like pump and dumps from the outside, the true compounding value in web3 is built in small, passionate communities rallying around a common goal.
Projects like Shiny (a community of builders/creators), FWB (a community of artists), Recess (a community of builders shipping products actively) and Proof (Kevin Rose’s community of NFT collectors) are all examples of what I’m referring to with this trend.
Why are these types of communities so compelling?
The simple answer…Dunbar’s number.
Dunbar’s number refers to the suggested cognitive limit for the amount of stable social relationships a person can have. The number is ~150.
The reason I like these niche communities is because this is where the majority of people in web3 actually spend their time.
True network effects come from smaller groups of people that are actively building, working and cross-promoting. This is where the majority of the 150 relationships actually live.
If I were you, I’d try to find and join a few of these that fit your authentic interests.
5. Gaming leveraging new models
Gaming is being completely reinvented in the web3 world by leveraging a variety of new incentive models.
The early poster child of play to earn (P2E) was Axie Infinity, a game where thousands of users in the Philippines were earning a living just by playing the game.
The rapid rise and success of Axie led to an incredible amount of early innovation in the play to earn (P2E) and play and earn (P&E) models.
It’s too early to tell which model(s) will be superior, but it’s obvious that a lot of attention and capital is flowing into this space.
This is the trend that I know the least about tactically, but have the most conviction will be gigantic.
So long story short, I’m launching another newsletter called Crypto Therapy.
I really enjoy writing NFTeasers (and will continue writing it weekly for the foreseeable future), but my interests in crypto and general community/business building expand far beyond the pearly gates of NFTland.
In other words, I’m trying to drop some knowledge bombs that don’t fit within the NFTeasers format.
I’m hoping that Crypto Therapy can be more of a sandbox for me to flush out ideas/frameworks and share cool crypto happenings across the entire space as I’m seeing them in real-time.
I’d also love to share more, behind the scenes, “build in public” style, content about our journey to build Sunday:Drip.
The plan is to publish almost daily and in bite-size chunks (<3 minute read). If I don’t have something worth sharing, I’ll spare your inbox 😊
What exactly are you going to cover?
I plan to write about two buckets of topics, thinking and building.
In the thinking section, I'll cover things like:
Overarching themes I'm seeing in web3 and why they matter
Predictions for what I think will happen in given scenarios
Moves/trades I'm making and why I'm making them (things that aren’t captured in NFTeasers)
Moves/trades I missed and why I'm fomoing about it
In the building section, I'll spend time "building in public" for Sunday:Drip. This will cover things like:
Progress and updates on big initiatives
Strategy around community building, growth, tokenomics, etc.
Updates of what is/isn't working
Ideas from the community for tooling that should exist
Where can I sign up?
In an effort to try before we buy, I’m going to write it separately from the main Sunday:Drip feed. This is mostly to spare the inboxes of our current subscribers as I experiment!
We may quickly decide it needs to funnel under everything else, but for now, you can find it here → https://cryptotherapy.beehiiv.com/
Of course, like everything we write, this will be completely free, forever. I encourage you to share it with as many people as you can who are interested in learning about crypto happenings in bite-sized pieces.
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Legal Disclaimer: No information shared in NFTeasers is financial advice. All content is for entertainment and informational purposes only. Wavy Labs, LLC is not a registered investment, legal, or tax advisor or a broker/dealer.