Many purchasers of Otherdeeds, the virtual land that sparked a buying frenzy last weekend and led to skyrocketing transaction fees on Ethereum, are underwater as prices dropped after the initial euphoria wore off.
Yuga Labs, the creator of the popular Bored Apes Yacht Club collection of NFTs, helped raise approximately $320 million on Saturday from a sale of Ethereum-based Otherdeeds NFTs, making it the biggest sale of its kind. Each purchaser paid $5,800 per NFT, plus as much as $6,000 in transaction costs or “gas fees,” which together added up to a total of roughly 4.21 Ether at current prices.
Buyers, earlier today, could pay as little as 3.6 Ether for these NFTs on OpenSea, the world’s biggest NFT marketplace. Many buyers selling their NFTs at that price could lose $1,700 per transaction.
“I think the Otherdeeds sale was botched, leading to user backlash,” said Aaron Brown, a crypto investor who writes for Bloomberg Opinion. “It remains to be seen whether it can recover user trust and enthusiasm.”
The drop has also prompted backlash from Twitter fans who had snapped up the NFTs.
The NFT market is volatile. NFT transactions in Decentraland, a platform where users can buy and sell virtual plots of land, are down 37% over the last 30 days, according to tracker DappRadar. NFTs have also struggled in secondary markets, and sometimes, in primary markets as well. One in three NFT collections, on average, have little to no trading activity, according to blockchain analytics firm Nansen. Another third are trading below the amount it cost issuers to mint the tokens.
Trading volume for Otherdeeds is down 68% on Tuesday from a day earlier, despite it being the most traded NFT collection over a 24-hour window, according to DappRadar. The number of traders — though in the thousands — has dropped by half as well.
Each Otherdeed represents a plot of land. Some parcels feature mountains and brooks while others are made of what appear to be precious stones. The land is expected to be used in the upcoming Otherside metaverse game. Holders of the ApeCoin token who verified their identities jockeyed to buy deeds for 55,000 parcels of virtual land over the weekend. ApeCoin’s price skyrocketed last week, in anticipation of the sale, before it declined.