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Yuga Labs, the parent company of Bored Ape Yacht Club, announced in late March that they raised $450 million in funding to create an NFT media empire with games and a metaverse project. This comes weeks after Yuga Labs acquired the NFT collections of CryptoPunks and Meebits from Larva Labs.
Yuga Labs is receiving massive leverage to steer the future of “profile picture-based NFT” projects (PFPs) with the merger of three of the most valuable collections in the market. As of this article’s publication, Yuga Labs controls the most traded roster of metaverse items (10,000 of BAYC and CryptoPunks each, 20,000 of Meebits) with an accumulative trading volume of $4.5 billion.
They hope to create “an interoperable world” that is both “gamified” and “completely decentralized,” said co-founder of BAYC, Wylie Aronow, according to The Verge. “We think the real Ready Player One experience will be player-run,” he said in relation to their collectibles.
Accordingly, Yuga Labs hopes to materialize the promise of interoperable avatars in the metaverse by creating new value for NFT PFPs beyond the utility of anticipation.
NFT PFPs became one of the hottest use cases of NFTs in 2021. They typically come in collections of characters with various rare traits—once purchased, the asset lends owners exclusive access to future games, IRL events and merchandise by the NFT’s issuing party. As a result, NFT PFPs manifested into a kind of fashion and social signaling for digital identities.
Yuga Labs pioneered the community-focused blueprint that is now familiar to myriad NFT ecosystems. With the BAYC brand, Yuga Labs elevated the concept of owning an avatar by attaching perks such as club membership, early access to new offerings and commercial usage rights to each purchase. For that reason, these strategies elicit high engagement for Bored Ape holders, who hope to preserve the exclusivity of having an identity in the community.
Now, Yuga Labs aims to introduce new ways to expand and build their NFT community. The company is partnering with “a few different game studios” to develop their new metaverse project, Otherside, that will gamify their NFT collections.
“The company plans to create development tools that allow NFTs from other projects to work inside their world,” according to their CEO Nicole Muniz in an interview with The Verge. Sources predict that the move will counterweight the fear of companies like Meta monopolizing the digital experience.
In an interview with Vox, Meta company spokesperson Christopher Sgro said “we cannot build the metaverse alone—collaboration with developers, creators, and experts will be critical.” However, such potential “collaborators” have already revealed that Meta isn’t playing as fair as they indicate. The company has already been accused of blocking competing apps on Meta’s Quest AR/VR app store. Moreover, some developers feel blocked from entering the market because Meta continues buying up the technology they’re trying to build.
Many in the industry are hopeful that Yuga Lab’s promised “interoperability” and energized community will be the prevailing force that creates a truly open metaverse.
“People won’t bond from spending time together in a shared virtual space with nothing going on,” said Greg Solano, a Yuga Labs co-founder who goes by the pseudonym Gargamel. Rather, people “bond from being put in positions where they have to collaborate.” By hedging on the belief that community will triumph all, Yuga Labs’ vision distinguishes itself among previously-established metaverses.
Other players in the industry such as Decentraland’s creative director Sam Hamilton are welcoming Yuga Lab’s entry into the metaverse space.
“We have collaborated in the past and I love their team,” said Hamilton in an interview with Fortune. “We don’t see other Metaverses as competition, we are all building the next iteration of the internet collaboratively, together and having BAYC building can only be good for everyone!”
There is still no announcement of a release date for the upcoming project.
ABOUT THE WRITER
Ivy Tsang is a Tech Innovation Fellow at Identity Review from the University of Southern California, where she explores the intersections between the Arts, Technology and Business of Innovation.
Contact Ivy at firstname.lastname@example.org.
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