The average price of a CryptoPunk has increased by 53% in the last week, rising from 34 ETH ($87,800) on July 24 to 52 ETH ($135,000) yesterday.
The unexpected increase in popularity is the result of a buying spree that began on Friday and has continued through the weekend, with Sunday’s volume already reaching 8,520 ETH ($22 million) as of noon UTC.
Gary Vaynerchuk, a motivational speaker, and entrepreneur, ignited the beacon on Friday after purchasing a CryptoPunk for 1,600 Ethereum ($3.7 million). On the same day, 0x650d, a pseudonymous investor, spent 2,700 ETH ($7 million) on 80 CryptoPunks.
Non-fungible tokens, or NFTs, are used to demonstrate ownership of a digital or physical asset. NFT sales skyrocketed in February, but the excitement surrounding them has since dissipated.
With a weekly volume of approximately $60 million, CryptoPunks is the most valued NFT project. Each of the 10,000 avatars represents one of four different races, including zombies and aliens, and has unique face traits and headgear. Millions of dollars are paid for rare ones.
According to OpenSea data, the number of sales jumped from 21 on July 24 to 303 yesterday. In the same time span, daily trade volume increased by 1,342 percent, from 709 ETH ($1.8 million) to 16,000 ETH ($41.5 million). Over the last two days, half of the top ten most costly CryptoPunks changed ownership.
According to Daniel Armitage, a member of the NFT investing collective PleasrDAO, the mini bull run for CryptoPunks began on Friday with big purchases by Vaynerchuk, followed by anonymous addresses that scooped up over 100 punks.
Vaynerchuk paid 1,600 Ethereum ($3.7 million) for CryptoPunk #2140. The CryptoPunk is one of 24 ape punks dressed in one of 419 knitted caps and 378 tiny shades.
Vaynerchuk expressed his satisfaction with his purchase, saying, “I have a lot of empathy for people’s curiosity, cynicism, or debate, but I have enormous trust in this asset.” I’m sure people have said the same thing about a Jackson Pollock painting at some point.”
However, he was quickly out-NFTed later that day. 0x650d, an unidentified investor, spent around 2,970 ETH (approximately $7.6 million) on 88 CryptoPunks.
On-chain analytics show that the 0x650d address used a Gnosis multisig to withdraw 3,000 ETH from crypto exchange FTX, indicating that numerous users had access to the address. The holder spent 99 percent of the funds on CryptoPunks.
Three Arrows Capital (3A), a Singaporean crypto hedge fund that was previously presumed to be behind the mass purchase, also purchased 10 CryptoPunks, including a zombie, for $2 million.
According to Armitage, after the spending rush, investments in NFTs are picking up again. “We’re seeing a lot of buying of Art blocks, Autoglyphs, and other top tier projects at the same time,” he said.
But how long could this go on? While some believe that purchasing a CryptoPunk is akin to purchasing the Mona Lisa two years after it was painted, others say it is a bubble poised to burst.