In This Issue
- Has the market capitulated?
- Sam has a report for you on PFP NFTs.
- Rebecca breaks down this week’s trending coins.
In This Issue
Happy Monday, Wealth Masters!
Before jumping into today’s preview, I just wanted to tell you that with Black Friday around the corner, I’ve been working on something really cool!
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Lark’s Portfolio Tips
Capitulation is usually seen as when we finally bottom.
Has capitulation come? Maybe, maybe not.
The social media rumor mill has a constant stream of theories about who will collapse next and bring the markets into complete Armageddon. If some of these theories play out to be true then the FTX capitulation could have only been an appetizer to the real capitulation.
However such sentiment is so often what comes in near the lows. I remember back in 2018 when Bitcoin hit $3,000 that many people were convinced we would fall to $1,000. Which didn’t happen.
Usually capitulation events are marked by some of the following
- Bankruptcies. FTX would be the big one. But the cascading effect to other players like Blockfi and Liquid has sent ripples through the market. The next ones at the chopping block if the price of Bitcoin stays down here are the Bitcoin miners. Before the FTX drama many mining companies were already on the verge of bankruptcy. We are also seeing loads of layoffs from major crypto companies like Coinbase.
- Sentiment. Unsurprisingly sentiment is in the gutter right now. While we do not have the full numbers a million or more people could have lost everything on FTX. Trust has been destroyed across the crypto market. If you go to social media it is basically all panic and end of times talk. Which feels warranted considering the current situation. But also lines up with market capitulation.
- Doldrums. While the FTX blowup definitely brought volatility back on the menu, before that happened though the market was WAY too quiet. Fewer people are coming into the market. Volumes have dropped along with prices. Interest in crypto is basically way down.
- Loads of indicators from on-chain to technical are showing that the market has hit a likely zone of capitulation.
- Celebs capitulating. Tom Brady has taken off the Bitcoin laser eyes from his profile. I am sure we will see a few others quietly get out of crypto. Also, we are getting all of the usual crypto doomsayers like Peter Schiff saying that crypto is dead.
- Volume. The 3 day candle for Bitcoin during the FTX collapse was the biggest candle by volume ever. Usually we want to see massive volume as market participants race for the exits. This is what happened.
So, is the bottom in? I don’t know. But all of our usual capitulation signals are indicating we are at or near the time of maximum financial opportunity in the markets. But this time can always be different. We still have a lot of wild cards
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What are PFP NFTs by Sam
NFTs are not only about trading pictures, but, let’s be honest, that has been a profitable focus of some headline-grabbing collections up to now. And one type of image that people have been trading a lot of are referred to as PFPs.
What is a PFP?
The phrase PFP stands for profile picture, meaning the picture you’d put up on your social media profiles. PFP NFTs can be used for this purpose, with each one displaying a distinctive character.
They tend to be algorithmically generated upon minting, but the components they’re created from are designed by artists. Each NFT in a collection will be unique, but some might be very similar to one another, and all will be recognizably part of the same project.
Within a collection there will be traits that are rare and more sought after, and there might be 1/1s, meaning specially designed items that can sell at very high prices.
For some time, 10,000 was the standard number of items for an NFT collection, but that’s changed, and there are now many smaller, and a few larger, collections. During bear-market conditions, some new launches have reduced their supply.
Some common NFT themes include cartoonish apes and other animals, pixel-art, manga and anime, and there’s a tendency towards cuteness, in-jokes and nostalgia.
What are the top PFP collections?
The collection that set the template for PFPs is CryptoPunks, which minted for free back in 2017, hit a floor price over 120 ETH in 2021, and currently sits at a floor of around 66 ETH.
Image credits: Yuga Labs
CryptoPunks is the original, crossed over into the world of top-end art auctions, and stood out recently by being completely unaffected (so far) by the FTX-initiated crypto carnage. It was just announced that a plan called the Punks Legacy Project will donate CryptoPunks to be displayed at galleries around the world.
The other definitively top tier collection is Bored Ape Yacht Club, created by Yuga Labs. In autumn 2021, BAYC flipped CryptoPunks, meaning its floor price became the higher of the two collections. However, they flipped back this week, with BAYC prices affected by the FTX implosion.
Image credits: Yuga Labs
You could also include BAYC spin-off Mutant Ape Yacht Club as top tier. It’s cheaper, but part of the same project and grants access to the BAYC ecosystem.
By the way, the CryptoPunks IP was acquired from creators Larva Labs by none other than Yuga Labs, meaning Yuga now actually owns everything at the top.
There are far more collections in the tiers below CryptoPunks and BAYC, and plenty of competitive disagreement about which projects are real contenders.
Image credits: Azuki
Azuki are perhaps the third most sought-after PFPs, and are certainly the dominant manga/anime-centered project.
Meebits are expensive, and–like CryptoPunks–were created by Larva Labs and subsequently acquired by Yuga Labs.
Image credits: Doodles
After that, Doodles have cachet and set a distinctive visual trend, while Clone X are owned by Nike and were co-created by the famous artist Takashi Murakami.
From there, Cool Cats, World of Women, and Deadfellaz are all well-established collections that are respected in the NFT space, and look able to stick around and build.
PFPs with Potential
There are a few collections that appeared on the scene a little later than the projects mentioned above, but have dedicated communities and look like they’re in it honestly for the long run.
Image credits: Truth Labs
Goblintown blew up when the bear market was in its early stages, and soared from a free mint to a floor price over 7 ETH. They can be picked up from below 1 ETH now, but this project is still in the game.
Degen Toonz had a slow start at the beginning of 2022, gained in popularity and hype, and subsequently hit a floor price high close to 3 ETH. The floor is back below 0.5 ETH now, but the community is as strong as ever.
Image credits: Renga
Renga is a high quality manga/anime-inspired collection by a talented artist, and dynamically reinvigorated the NFT market in the autumn, garnering praise from, among many others, Gordon Goner, a co-founder of Yuga Labs.
How About Away from Ethereum?
Over on Solana, DeGods is the top project, and if you’re interested in the PFP creative process, one of the artists who worked on the collection wrote a detailed thread on that topic.
Image credits: DeGods
The founder of DeGods is Frank DeGods, and he’s also behind another highly regarded Solana PFP collection called y00ts. Both DeGods and y00ts are connected to Dust Labs, a web3 company building out its own ecosystem of products and services.
Frank talked recently about moving both of these collections from Solana to Ethereum. Nothing is confirmed as yet, but a move potentially could happen.
There are many other Solana PFPs worth looking at, including Okay Bears, Solana Monkey Business, and Degenerate Ape Academy.
On Cardano, SpaceBudz was the first 10,000 item PFP collection to mint on the chain, giving it a special, long-term significance.
Image credits: The Ape Society
The current top Cardano collection, in terms of volume, is The Ape Society, and buying an NFT from this collection provides access to the expanding Ape Society ecosystem.
Clay Mates is an early collection which has very distinctive design work, is a big name in the Cardano NFT world, and is notable for collaborating with Snoop Dogg.
Do PFPs Have a Future?
NFTs are the least battle-hardened, and riskiest part of the crypto sector, so you might think PFPs only have a slim chance of survival. However, there is an alternative perspective.
PFPs are a remarkably welcoming entry into crypto. There are collections that tie in with popular artists, comics and animation, fashion, gaming, and some globally famous brands.
What’s more, utility can extend to being used as community/ecosystem access tokens, storytelling devices, gaming and metaverse assets, and projects are always looking for new ways to expand.
Basically, PFPs are perfect for onboarding people into crypto, crossover most easily into the mainstream, and are the part of the crypto world that comes across as the most distant from, well, crypto, which could sometimes–depending on the wider climate–be an advantage.
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Trending Coins This Week by Rebecca
Here are my key takeaways from the trends this week, and the market is still reeling from the fallout from the FTX collapse.
1 – Cronos (CRO) is the utility token for the CryptoCom exchange that’s tanked 28% following concerns that CryptoCom’s proof-of-reserves are false. On-chain data shows they transferred $320K of ETH to Gate.io.
2 – Trust Wallet is the third-party hot wallet affiliated with Binance that’s seen its TWT token surge 47% in 24 hours as Binance CEO promotes the wallet on Twitter.
3 – Solana is an L1 blockchain that’s leading the crypto crash losing 32% of total-value locked (TVL) in the 24 hours after the FTX collapse. Sollet-wrapped tokens on Solana issued by FTX are no longer redeemable and are trading at a 77% discount.
4 – GMX is a derivatives exchange on Arbitrum that’s been trending higher despite the FTX collapse, as DeFi thrives in a world where CeFI is failing. Wondering if you should invest in GMX? Here’s a great place to start: What is GMX Exchange? Is GMX Good? | 2022 Review
5 – dYdX is a DEX on Ethereum that’s placed Solana trades in “close only” mode so users will only be able to close out their positions and not open new ones. This move came after concerns about the Solana ecosystem in the aftermath of the FTX collapse.
6 – Metavault Trade is a DEX on Polygon that’s gaining more popularity in the wake of the FTX collapse and the controversy surrounding centralized exchanges.
7 – Aptos is a newly launched Layer-1 blockchain created by ex-Meta employees that’s seen fraudsters launch a fake airdrop campaign on Twitter. Whilst the Aptos blockchain hasn’t been hacked, the scammers launched a fake website identical to the Aptos website.
8 – Bitcoin has fallen under $16,000 for the first time in two years and Elon Musk tweets “BTC will make it but might be a long winter.” Bitcoin held by miners has also declined by 9,402 BTC to a ten-month low in the past week.
9 – Serum is a DEX on Solana that’s seen the developers fork the exchange to fully separate itself from the fallout of FTX. Serum could have been compromised as part of the alleged FTX hack.
10 – BNB is the utility coin for the Binance chain that’s seen its CEO, CZ, announce a crypto recovery fund to help struggling firms facing liquidity issues.
11 – Ethereum turns deflationary for the first time since the Merge as more tokens are burned than created. On-chain data also shows that CryptoCom exchange sent $320K worth of ETH to Gate.io.
12 – SafePal (SFP) is a self-custody wallet provider token that rallied 27% in a 24-hour period, as investors are reminded to take control of their private keys. SafePal is backed by Binance.
13 – Cosmos Hub (ATOM) powers the Cosmos ecosystem and its seen its blockchain founder, Jae Kwon, oppose the proposed changes to its ATOM token that would have introduced liquid staking.
14 – KuCoin is a crypto exchange that’s quickly losing customer confidence in the aftermath of the FTX collapse. KuCoin’s CEO has denied rumours of the exchange being insolvent and says its proof of reserves will be ready in a month.
15 – Uniswap is a DEX on Ethereum that’s gaining more popularity in the wake of the FTX collapse and the controversy surrounding centralized exchanges.
Thank you so much for your support, and I truly hope that today’s issue will give you insights needed to help you master your wealth.
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Lark and the Wealth Mastery Team
TCL Publishing ltd (director Lark Davis, owner of Wealth Mastery) is not providing you individually tailored investment advice. Nor is TCL Publishing registered to provide investment advice, is not a financial adviser, and is not a broker-dealer. The material provided is for educational purposes only. TCL Publishing is not responsible for any gains or losses that result from your cryptocurrency investments. Investing in cryptocurrency involves a high degree of risk and should be considered only by persons who can afford to sustain a loss of their entire investment. Investors should consult their financial adviser before investing in cryptocurrency.
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