NFT’s decline is already evident: no more work, no more rolling

It's time to change the whitelist system .

A few days ago, a friend asked me: I haven’t paid attention to NFT for a few months, why are you still scrambling for PFP?

I also refuted it: there is a lot of traffic from outside the circle pouring in, giants have entered the market, and applications are blossoming everywhere... But think about it carefully, for an ordinary investor participating in NFT, most of the time is still spent on researching and grabbing new small pictures. After all, who doesn’t want to be a diamond hand and buy the next BAYC Bored Ape?

However, in recent times, I have increasingly felt that I can no longer bear the brunt of the effort and can no longer roll.

First of all, the Gas War for the popular project Public Sale is no longer a battlefield for ordinary players, and scientists who write scripts have already started to compete with each other; secondly, the threshold for the whitelist is getting higher and higher, and you may not be able to get it even after chatting, recruiting people, and doing secondary creation for several weeks. The over- the-counter market transactions for the whitelist are even more chaotic, and pricing is entirely based on guesswork. There have even been scandals in which well-known community MODs enriched themselves; most importantly, after all the trouble, you may not be able to make money.

According to NFTScan data, more than 840,000 NFTs were born on the Ethereum chain in the past 7 days, and many projects became garbage on the chain as soon as they were born.

On the surface, most of the NFT projects with active communities are still hot and will not "break the issue price", but during the project sales process, the mint price is often just the tip of the iceberg of costs. Taking into account the "hidden costs", many recent popular projects have actually begun to "break the issue price".

When the water reaches the end, it is hard to stop

Let’s first talk about “Scientists Rolling Scientists”. Taking Karafuru, one of the most popular projects recently (ranked first in Opensea’s 7-day trading volume), as an example, according to data statistics from Twitter user @sethwizard0x, the average Gas cost of scientists is more than 4.57 ETH. Calculated based on each person minting 2 NFTs, plus the mint price of 0.2 ETH, the cost of each is 2.48 ETH.

Contributed by @sethwizard0x

The current floor price of Karafuru is 3 ETH, and it once dropped to around 2.3 ETH on the day of the box opening. It can be seen that being a scientist is not a business that is guaranteed to make money, not to mention that Karafuru is one of the best performing projects in recent times. The myth of scientists who became rich by minting NFT projects is no longer the same as before.

Now let’s talk about the whitelist (WL). Many articles have already described how difficult it is to get a whitelist nowadays.

The whitelist system began to emerge in the third quarter of 2021. Its essence is to fairly reward "labor is wealth" and reward members who contribute to the community and attract traffic. Common ones include rewarding high-frequency users, incentivizing new members to the community, encouraging secondary creations and memes, cooperating with KOLs, rewarding users who win in quiz games and community activities, and holding sweepstakes.

At first, the whitelist mechanism was able to effectively motivate active members of the community and alleviate the Gas War in the Public Round, but things soon changed. In the early days of Discord, NFT communities with thousands or tens of thousands of people were considered active, and it was not difficult to get on the whitelist as an active user.

With the explosion of NFT, especially after PhantaBear was changed into Jay Chou's avatar, a number of celebrities endorsed it, and the price soared, a large amount of new Chinese traffic has poured in. It is now common for new projects on Discord to have tens of thousands of people, and it is not uncommon to have hundreds of thousands or even millions of people.

As a result, there is a complete industrial chain for obtaining the whitelist, and a large number of "studios" specializing in obtaining the whitelist have emerged . They hire college students to chat and recruit people, hire painters to paint, and write programs to increase activity. These are the most basic. There are even those who perform eighteen kinds of talents, sell their misery to the project parties, and recently there was a live broadcast of eating... It can be said that they will do everything they can.

Screenshots circulating in the community

The whitelist system should be changed

Most of the individuals who have made it to the whitelist regard it as a treasure and will wait to mint it themselves, while the whitelist studios that have already paid a lot of manpower and technical costs often choose to guarantee profit before minting. Naturally, there are also clearly marked whitelist secondary markets and over-the-counter trading communities.

Some projects have begun to boycott whitelist studios, trying to find these wallet addresses and remove them.

But where there is demand there is a market. Those who bought the whitelist before at least had some room to make money, but recently they have started to lose money on a large scale.

For example, HYPEBEARS is one of the projects that has become popular before its release recently. It has more than 360,000 people on Discord and 240,000 followers on Twitter. From these data, we can see that it is not easy to get a whitelist. The price of the over-the-counter whitelist was also hyped up to more than 1 ETH before the release. After the release, the floor price reached as high as 1.6 ETH. However, after the box was opened, the price fell all the way to a minimum of around 0.2 ETH.

Not only are those who take over at the secondary level and buy on the whitelist suffering heavy losses, even those who mint (mint price is 0.4 ETH) have started to lose money.

HYPEBEARS' Oepnsea price trends

The failure of HYPEBEARS also exposed another problem. Nowadays, it usually takes several days for NFT to go from minting to unboxing. Unboxing has become a dividing point. In the early stage, everyone can only get a glimpse of what the project looks like through Sneak-peak in the community, and after a large number of unboxings, the "true appearance" that does not meet expectations often appears .

Many project owners rush to launch their products, and in order to catch the popularity of the products, they produce shoddy products. When they promote their products, they talk a lot about how cutting-edge the designs are, but when you open the boxes, you can obviously see that they just hired some artists to work overnight, without any respect for the market.

HYPEBEARS was called "ugly enough to change your mindset", "visual garbage", "not as good as the work of Taobao artists", and completely did not meet market expectations. I thought it was a moving picture, but it turned out to be static. I thought it was advanced 3D, but it turned out to be a piece of plasticine.

HYPEBEARS Opensea Screenshots

A meme that mocks HYPEBEARS that is popular in the community

In addition, when we open blind boxes, we always hope to get a rare model one day, hold 1/1, and become a diamond hand, but most of the time what we get is the floor.

Regarding this issue, Odaily Planet Daily has previously discussed with industry insiders. In fact, the project party is likely to have adjusted the random numbers, and ordinary players will skip those numbers when minting. They can even modify the metadata to make your rare model become a common model.

Ordinary investors are always the ones who get hurt

In addition, the issuance of NFTs and the operation of fan communities are mostly carried out in the form of DAO. Most people are anonymous, and most communities also use Mod (moderator: administrator) for daily communication and maintenance. When disputes over interests arise, it is often a mess and it is not uncommon for quarrels to break out.

Recently, 9x9x9, a well-known NFT KOL and core contributor of 721 CLUB and OpenDAO, sent several tweets in a row, accusing former Mods of using the brands of Club721 and OpenDAO to obtain whitelists for community cooperation, and pocketing the profits, keeping most of them for themselves. For example, CoolMan and others talked about cooperation on 100 whitelists, but only 30 were selected in the final community lottery.

The former mod quickly fought back, saying that 9x9x9 had driven away 721's digital former mods and usurped the throne, and exposed his true identity as Qu Jiawei, the CEO of the Yide Exchange who ran away after the ICO in 2019, and asked all NFT project parties to stop cooperating with OpenDAO. 9x9x9 later denied it and said he would continue to remain anonymous.

Regardless of who is right or wrong, or what the true situation is, this not only exposes the difficulty of DAO governance in the distribution of benefits, but also reflects the level of chaos in the current NFT market.

The “white list” is like a black box. It is difficult to tell who got it, who is profiting from it, and how many other tricks are involved.

As an ordinary NFT enthusiast who takes over at the secondary level, it is easy to feel tired and give up after being cut a few times.

It is hard not to think of the IEO and IDO that were once very popular. At first, the platform carefully selected projects, there were few projects, and there were many investors. If you grabbed them, you would make money. If you held them for a long time, you could make tens or even hundreds of times more. Later, the dividends gradually weakened, and the frequency became higher. If you grabbed them, you could still make several times more money, but many of them peaked as soon as they were launched, and most people chose to sell them as soon as they were launched. In the end, it reached the point where even participating in IDOs could be cut, and projects that broke the issue price were not uncommon.

During this process, there have also been cases of project parties engaging in insider trading and even conflicts of interest with trading platforms.

In the end, ordinary investors are always the ones who get hurt. A market without ordinary investors will gradually be drained of vitality, projects will be entangled, and development will stagnate. We have experienced this cycle too many times.

NFT is a promising early market with many conscientious projects and high-quality teams, but it is also filled with countless chaos and scams. It is time for the project issuance system and platform to further protect retail investors.

Author: Planet Flower