NFT Flops: What Can We Learn?

TL;DR
Last month there were two big NFT mints that failed to sell out: Fewos by Fewocious, and MareBears by RSTLSS. Both had huge supplies for current market conditions, and Fewos in particular was relatively highly priced. Contrary to wider perceptions though, there have been some successful NFT launches this year, including gaming and art NFTs, and collections that were free or very low cost, along with some projects that have maintained especially strong communities.

It’s been a difficult year in general for NFTs, with some big drops turning into NFT flops. At the same time though, a few new projects have performed very well, making it difficult to predict what comes next, and recently, we were left wondering what happened to a couple of major mints that ran into problems.

Let’s look at what went wrong, how this contrasts with the projects that have done well, and what we can learn when it comes to buying new NFTs.

Two Major NFT Flops

At the end of last month, there were two big, hyped-up new drops which were generally expected to have a decent chance at selling out, and yet both fell short.

Fewos

The artist Fewocious has been a famous name in the NFT space since 2021, with a hyper-colorful style, some big sales, and a sizable following. His long-term focus has been the FewoWorld project, which looks like it’s aiming to be some kind of Web3 interactive art platform, all built around Fewocious and his signature designs.

It looks very high quality, and the next step was the Fewos collection drop. Fewos are PFPs intended to inhabit FewoWorld, and there were to be 20,000 of them, costing, when it came to the public mint, 0.25 ETH, although before that, there were airdrops, and big allow list mints priced at 0.08 ETH.

When it came to the public sale though, supply outstripped demand, the mint was finally halted with the total collection supply capped at 18,000, and on secondary, Fewos are currently trading at just over 0.05 ETH.

So what was the problem? It looked like a launch that would have skyrocketed in 2021/22, but in Q4 2023, it’s a different story, and that initial 20,000 item supply simply looks way too big, while a 0.25 ETH public price tag is asking a lot.

While Fewocious fans who already held his NFTs before this mint were enthusiastic, it seems like expanding beyond that core community would have required a much lower price point.

MareBears

The other mint that didn’t go according to plan was MareBears, from Web3 project RSTLSS. This one had the potentially effective selling point of some big name partnerships, as on the mint page, Paris Hilton, Gremlin and Ubisoft are all mentioned (which is, admittedly, an unusual combination.)

The project was set to mint 15,000 PFPs priced at 0.077 ETH each but, at the time of writing, is stuck at around 3,500, with the mint still open.

In this case, we again have a supply that is just too high for current conditions, and while 0.077 ETH might not look too excessive, keep in mind that some decent-looking new projects looking to gain a foothold have been offering NFTs for free. And although MareBears was able to mention Paris Hilton and Ubisoft, and does have very cool-looking promo vids, it still isn’t entirely clear where the project is heading.

That might not have mattered a year or two ago, when big names and slick visuals were more than enough to generate FOMO, and definitive business plans weren’t required, but right now there just isn’t anywhere near that same willingness to gamble, and there are far fewer potential buyers competing to mint.

Successful Drops

You might look at those two launches, and at the general air of uncertainty around NFTs, and conclude that there are no profits to be found anywhere in the market, but that isn’t true. In fact, there are several projects that minted this year and have returned gains for early holders, as we can see:

Looking at those successful projects, what sets them apart? Here are some possible factors.

• Cheap or free. This seems simple, but many of the projects that have done well minted for free or very cheaply, making them risk free to collect while interest grows in what’s being built, with secondary sales then picking up despite the subdued market.
• Gaming utility. Gaming is an area in which NFTs have genuine utility, and digital assets are likely to become increasingly integrated into games. Well-made gaming projects are an NFT niche worth paying attention to.
• High status art. This could mean work by a very famous artist, especially if they cross over into the traditional art world, or it could mean specialized Web3 projects with niche NFT art credentials. Either way, the art world on the whole is accepting of NFTs, and that looks likely to continue.
• Committed degen community. In 2021/22, NFTs were all about which projects had the loudest and most loyal communities. Since then, the ability of a community to drive and hold up prices has diminished across the space, but there are a few projects that still benefit from that kind of strong community factor.
• Outliers. There will always be a few projects that defy expectations for reasons that aren’t clear. These are the outliers, and if you happen to find yourself holding these gems, then treasure them, or at least make sure to sell at the top.

Overall, although the NFT markets are difficult to navigate right now, there are still profitable collections dropping, and gains to be taken. However, it’s important to look at recent launches and note what worked well, and what mistakes to be wary of.