Two years ago, the Bored Apes were on top of the world.
Yuga Labs, the creators of BAYC, were in great shape after announcing their Other side gaming metaverse and acquisition of CrypoPunks and Meebits from Larva Labs.
This momentum has created fervor, with collectors flocking to Bored Apes like never before, pushing the collection's floor price to its all-time high of 128 ETH.
But since then, things seem down only. Last week, the BAYC floor price fell to 10 ETH – the lowest in almost 3 years and a -92% decline from the April 2022 ATH.
Why this decline?
A few contributing factors here have been beyond Yuga's control, such as the rise of hyper-farming on Blur generating selling pressure, or more collectors jumping ship to take positions in hotter ecosystems, like Bitcoin Ordinals or Solana memecoins.
Other factors are But it's Yuga's fault. At their peak, they expanded their offerings to 25 different collections, a sprawling umbrella that is confusing and has discouraged more than a few holders. Their recent acquisitions of PROOF and Moonbirds many have been perplexed, leading to complaints that Yuga lacks a big, cohesive vision.
Additionally, as of now, the highly anticipated Otherside metaverse is still in the early stages of development, and while early playtesting looks promising, smaller teams like Nifty Island went further and faster, towards a similar goal.
Another point worth mentioning briefly here is sign value.
NFTs derive their value not only from their utility and exchangeability, but also from their social dimensions, and the social value of a Bored Ape today is the lowest it has been in some time. They no longer have the same aura as before, for now their main value is exchange value, and some holders have moved on to more memory-laden projects as such.
So what should Yuga Labs do? Can they bounce back and restore the Bored Apes to their former glory?
It is certainly possible, and there have been encouraging signs recently. First and foremost, Greg “Garga” Solano, co-founder of Yuga recently returned as the leader of the company.
It was the right move after a lackluster CEO tenure from former Activision exec Daniel Alegre, and if anyone can help the Bored Apes recapture their original magic, it's Garga. In his return announcement, he said:
“We want to free Yuga's BAYC team as much as possible to go against his vision. More concentration, more agility. So it can… create space for magic and crazy shit that we used to do more often.”
This renewed emphasis on concentration and streamlining is already manifesting itself in other areas as well. For example, last week Yuga sold its HV-MTL and Legends of the Mara (LoTM) game titles to Faraway, indicating that it is scaling back efforts to double down on its major projects, like Bored Apes and Otherside.
These kinds of moves are exactly what everyone who supports the Bored Apes wants to see, but there's still a lot of work to do, so should we be bullish or bearish on BAYC in three years?
In the short term, things may get worse before they get better. With ETH NFTs in a delicate place and brighter objects around the cryptoeconomy currently, I could see the floor price of Bored Apes dropping below 10 ETH, although I suspect that wouldn't last long.
Longer term, the outlook looks much better. Yuga leaned on its partnership with Magic Eden, which is now the most active NFT market, and which can pay dividends in the future. The launch of the ApeChain L2 later this year and the launch of Otherside in the coming years can also be major catalysts for BAYC.
Additionally, Yuga still has a lot of growing to do when it comes to its brand, community, and resources. In other words, they're definitely not faced with a blank canvas with few options.
So while it's impossible to say if Bored Apes will ever reclaim their previous ATH price floor of 128 ETH, their future prospects remain considerable, and I could imagine the floor trading above 40 again ETH by the end of 2024.
Long story short? Bored Apes are down, but not out, and I think there's more reason to be optimistic here than bearish at the moment. Let's see if Yuga can go all the way and make his comeback as a result!