6,566%.
In just over two months.
Yesterday, I sent you a dispatch explaining why I have a hunch that the crypto and NFT markets have likely touched bottom because of the way they’ve reacted in the months since the Federal Reserve began hiking interest rates by big amounts.
In short: They’ve started trading within a fairly narrow band (at least in crypto terms)—meaning they’re not constantly grinding lower daily, as they had been for many a month. That would seem to indicate that the crypto market has absorbed the Fed’s message, processed it, and is now moving on. It’s slowly getting back to determining the value of crypto and NFT projects based on their merit and not the Fed’s actions.
Which brings me back to that 6,566% gain.
It’s part of the story I want to tell you about today. And that story is this: Even in the depths of a bear market for crypto and NFTs, project teams continue to build their business, and investors are pocketing honkingly monstrous gains on NFTs that have existed for a while but which are suddenly shooting higher…or they’re bidding up certain new NFTs right out of the gate.
But let’s start with that big gain…
That’s my gain (on paper still) for an NFT tied to a project called Blxckout. It’s a group of techies based in the U.K. who are building out various technical services for the Web3 space. (Web2 is the current age of the internet, dominated as it is by big data firms like Google, Amazon, Facebook, et al. But now we are moving into Web3…a new decentralized era built on blockchain technology, the backbone of crypto.)
When Blxckout went to mint in mid-July, no one paid much attention. Everyone seemed to be focused on fears in the economy, and too few people understood what Blxckout was really up to.
The mint failed.
The company wasn’t able to sell out its collection of 5,555 NFTs at 2.75 Solana each, or about $110. So, the team refunded all the money to the few people who did mint, and immediately turned the project into a “degen mint,” an ultra-low-cost mint that appeals to super-risk-tolerant investors who generally know zilch about a project but are willing to throw a few bucks at an NFT that they then hope to flip quickly for a profit.
The degen mint price was just 0.1 Solana, or $4.
The project sold out in minutes.
But here’s the funny thing: The team isn’t a bunch of degens. They really are techies who are building interesting projects…like a database that puts government data on the blockchain so that self-executing smart-contracts can instantly pull necessary information for all kinds of future services that are going to show up in our lives.
People realized the company’s profit potential when it announced it would keep building and would soon release various products…which it has done.
Now it turns out that people who own five Blxckout NFTs will be given, for free, NFTs tied to each new project the team launches, and each of those free NFTs will share in the revenue generated by each individual project.
The base model Blxckout NFT has since soared to a minimum floor price of 2.1 Solana, a 2,000% gain—during a bear market.
Having interviewed the team, I realize this project was something special and that the team was highly competent. So, I went into the secondary market and grabbed five NFTs, including one that sports a gold gas mask. This one:
In an online comment, the team noted that maybe folks might wanna grab a gold mask one, a common hint in the NFT world that something special would accrue to those. Turns out the Gold Gas Mask NFTs (only 63 exist) got their own decentralized autonomous organization, or DAO, and are in line for special benefits.
I paid 0.9 Solana for mine.
As I write this, the lowest priced Gold Gas Mask commands 60 Solana. A 6,566% gain.
In dollar terms that’s a run from $40 to nearly $2,000 in two months. (My other four, which cost me about 0.5 or 0.6 Solana in total, are worth about 15 Solana combined.)
But Blxckout is not the only NFT project that’s confounding the crypto market downturn…
There’s Abracadabra, a project I mentioned a couple weeks back that sports childish-looking crayon art. That one minted at 1.23 and at time of writing the floor value is 45—a one-month, bear-market gain of more than 3,500%.
Or there’s y00ts, which I also mentioned a few weeks back. That team ran an application process for people to join a whitelist for 5,000 spots to mint a y00t. More than 71,000 applied. Through a complicated process, y00ts minted at a price of between roughly $300 and $1,200. The NFT opened at the equivalent of more than $5,000 in early September and has settled in the $4,500 range—a roughly 4x to 15x gain, depending on the price one paid to mint.
These events tell me that NFT buyers are looking for quality amid the bear market. They tell me the bear market, a serious nuisance, isn’t long for this world. They tell me excitement still permeates the NFT space, despite the red ink.
And they tell me that NFT buyers are looking to own the builders—the teams that have demonstrated an ability to launch a meaningful project even in a crummy environment.
All of which tells me that we are on the verge of something special.
It’s hard to see because of all the bear market news out there. But those who can look to tomorrow and see the direction of these business hiding behind goofy pictures are going to reap life-changing rewards.
When I say NFTs are going to be the reason for the next crop of crypto millionaires, I’m not trying to write click-bait. I truly believe it.
More to come as all of this plays out…
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