What are CryptoPunks: what they are, how to buy them, and what their future as NFTs holds?

Cryptopunks was a test project before it became real; yes, you don’t have to be shocked about it. It was a test project that was why 9,000 supplies were given freely to people before it eventually made the holders millionaires overnight.

It’s considered the eye-opener for NFTs and Crypto Arts, which is why everyone wants to own an NFT right now, including you reading this article (if you don’t own tons of NFTs already).
Furthermore, it is also said to have contributed to the expansion of the Ethereum blockchain and other Ethereum-based NFT initiatives, such as cryptokitties and more. Let’s quickly read what Cryptopunks is all about and why it became a valuable NFT today.

Cryptopunks: What are they basically?

Cryptopunks was created sometime in 2017, June specifically by Matt Hall, a software developer from Canada also with the founder of Larva Labs John Watkinson. Cryptopunks were given freely to people at that time. It was minted on the Ethereum network and released at no cost to crypto enthusiasts (more like what we call airdrop). It made a wave because it is free to claim and is also one of the first Ethereum blockchain projects.

Likewise, it is pixel art generated with an algorithm with a dimension of 24 X 24. They all have unique traits and up to 87 attributes, such as Pipes, eye patches, necklaces, caps, sunglasses, and other accessories are worn by punk-looking guys, girls, apes, zombies, and aliens. A single cryptopunk can have up to seven qualities, with some having two to three and others having none.

Cryptopunks are no longer what they were in 2017, as they have developed tremendously into one of the most sought-after NFTs in the whole NFT market. Yuga Labs acquired Cryptopunks in 2022, and Yuga Labs granted all commercial rights to Cryptopunks holders. Cryptopunks is credited with sparking the “NFT fever” in 2021. Cryptopunks offers two contract variants, each with 10,000 units.

How was cryptopunk started?

Grab some popcorn as we share the story behind how cryptopunks started. After watching the London punk scene and cyberpunk films and reading their novels, two individuals named Matt Hall and John Watkinson got inspired and then thought about creating a generator that produces pixelated characters.

After developing the generator, they decided to put it to the test, which resulted in the creation of 10,000 characters, including 6,039 males and 3,840 girls who are now known as Cyberpunks.

They then housed the homeless characters (cryptopunks) on the Ethereum network in 2017. It was then made available to crypto users to adopt one of the stray characters (cryptopunks) for free and pay a processing fee (gas fee), which was relatively cheap because people hadn’t understood how Ethereum works. The Larva Labs adopted 1,000 cryptopunks to themselves, and the rest were adopted very fast. After the free adoption, one can only buy the cryptopunks from the owner with lots of money. The cryptopunks are all humans except a few, such as 88 zombies, 9 aliens, and 24 apes. There are also 87 traits among the cryptopunks aside from their character type.

Do you want to buy cryptopunks NFT? Here is how

If you are interested in getting cryptopunks for yourself, you can do so by following the steps listed below;

• Larva Labs website (Smartphone users): For newbies, if you wish to buy a cryptopunks NFT, you must first set up your wallet and get it loaded with Ether (ETH). First, download a metamask or trust wallet and set up your wallet. After the setup, you’d get a wallet address that is unique to you alone. Once your wallet is set up, get yourself some Ether through centralized exchanges like Binance or a vendor around you. If all is set, you are ready to purchase the NFT. Head to the Larva labs website in the DApp section of the wallet, search for the cryptopunks you love to buy, click on it, then click on the buy button and confirm the transaction. When it’s successful, you will receive the NFT in your wallet, and ETH from your wallet will be sent to the seller.
• Larva Labs website (desktop users): For desktop or laptop users, kindly download a plugin called metamask extension on your chrome browser, then set up the wallet and get Ether (ETH) into your wallet readiness for the Cryptopunks purchase. You can get Ether from the metamask plugin because it has a button that allows you to buy directly from Coinbase. After the Ether is obtained, head over to Larva labs website; if the metamask extension is set up already, the website will add a button that allows you to bid, sell and buy Cryptopunks from the interface.
• Auction: some auction houses, such as Christie’s, sells Cryptopunks during special sales. Christie’s is thought to be connected to the cryptopunk boom, since they are the ones who introduced punks to the conventional world of art after selling Beeple for $69 million in March. Punk was the subsequent auction, with nine punks selling for $16.9 million. You should keep an eye out for such discounts.

Why are CryptoPunks so desirable and expensive?

The cost of Cryptopunk may cause you to ponder this question, especially if you consider it as a simple pixelated image. Here’s why it’s so costly and valuable.

• Scarcity: There will only ever be 10,000 supply available, which makes it very scarce compared to the number of crypto users and NFTs collectors. We have been taught about demand and supply in Economics (for those of us that attended classes “winks’’) that when the supply is lower than demand, there will be scarcity which will make the material increase in price. This is the same for cryptopunks, with higher demand and lower supply.
• Rarity: the value of cryptopunks depends on their rarity because some cryptopunks have more rarity than others. There are cryptopunks without any attributes, making them cost lower than other cryptopunks with attributes. A cryptopunk with seven qualities is extremely rare, making them the most valuable. Sometimes the value is decided not by rarity, but by the buyer’s passion of the NFT and willingness to pay any price to get it.
• Social status: Cryptopunk was one of the first NFT projects on the Ethereum blockchain, which has contributed to its current pricing. Some investors merely purchased the cryptopunk to avoid feeling left out since they were not among the early users of cryptocurrency, or to get the prestige (builders and visionaries) that comes with owning a cryptopunk.

In a nutshell, cryptopunks are valued due to the surrounding euphoria, their importance to Ethereum, and people’s desire to be among the first NFT collectors. Another factor to consider is that cryptopunk made many individuals millionaires overnight, and many people still feel it hasn’t hit its apex and can do much more.

Is CryptoPunk ever involved in a controversy?

The flash loan problem that happened in October 2021 when cryptopunk #9998 was sold for $532 million is one of the controversies surrounding cryptopunk (124,457 ETH). This fueled concerns that this was a type of fraud or money laundering, but Larva Labs refuted this, noting that the transaction was completed with a flash loan; the sale of this particular cryptopunk was subsequently nullified.

Another incident occurred in 2022 when one of the co-founders, John, sold off his V1 cryptopunks holdings and then sought to blacklist the project, which was removed off the marketplace days afterwards. Holders of the cryptopunks John sold may have suffered financial losses as a result of the denunciation. This generated a rift in the society since some believed it was appropriate while others felt it was improper for various reasons.

Is there hope or doom for cryptopunks in the future?

During the COVID-19 epidemic and also as a result of the rise in interest in blockchain and cryptocurrency, the price of cryptopunk was seen to surge. The supply and demand of the NFT are the determinant of the value of cryptopunk, as previously said because the only thing that can raise the price of something is continuously greater demand. Has cryptopunk peaked, or is it only now beginning to gain traction is the question on everyone’s lip.

Although cryptopunk may seem to have peaked, there is a prospect that it will rise to that high price once more given the features of some assets and the potential for more uses for the project, which might attract more investors and increase demand.

Another possibility is that because cryptopunk was one of the oldest NFTs and can function as the first-ever blockchain antiques, similar to how antiquated artworks are appraised, it will increase in value over time. As more celebrities buy Cryptopunks, their price will increase. This price increase will continue as more celebrities trade them.

Let’s use the electronic dance music performer Steve Aoki as an example. He purchased a cryptopunk for roughly 65 Ethereum and sold it for 300 Ethereum, which led to a rise in the price of cryptopunks. The price of cryptopunks will increase if this type of trade continues. The only two things that drive the NFT market are food (influencers) and spices (hype). Influencers tend to support projects that have a promising future; therefore, if there is enough enthusiasm and support for cryptopunk, the price will certainly soar.

In conclusion, cryptopunk still has potential and, depending on demand and use cases, has the ability to soar to the moon. What do you think would happen to the price of cryptopunks if Elon were to declare that every cryptopunk holder would have access to the Tesla Model 3?