ApeCoin (APE) Sees Prices Plunge After NFT Sales For Metaverse Otherside. – Tech Tribune France

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The hype around ApeCoin (APE) and the related Metaverse Otherside has taken a dip. ApeCoin slips into negative territory for the third day of a […]

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The hype around ApeCoin (APE) and the related Metaverse Otherside has taken a dip. ApeCoin slips into negative territory for the third day in a row after chaos reigned on Saturday in the first NFT sale for Otherside.

Arguably, no other new crypto project in 2022 is as controversial as ApeCoin (APE): ApeCoin’s stock market debut in mid-March propelled APE straight into the top 50 cryptocurrencies more capitalized – although not much was known about the potential uses at the time. The huge attention for ApeCoin stems from the fact that this project is linked to Bored Ape Yacht Club, the most commercially successful NFT collection in 2021. But among the investors who have jumped on the ApeCoin bandwagon, there are also many losers so far. In the final days of April, APE traded above $20 almost consistently, with the price curve peaking at $26. Less than a week later, ApeCoin has currently fallen back to around US$15 and thus suffered a real price crash.

Apart from the negative trends in the overall crypto market, it is the NFTs on ApeCoin that are causing disillusionment. It is important to know that ApeCoin will become the native currency of a planned Otherside metaverse. Otherside was announced in a deliberately secret way at the end of March and the starting signal for this metaverse was given on Saturday. In the lead up to it, it was learned that there would be virtual properties for Otherside in the form of NFTs to be auctioned off. In order to be able to hit it, many interested parties covered themselves with APE. But just a day before the auction, the rules were changed and a fixed price of 305 ApeCoin per NFT was set. As if that weren’t enough, when the Otherside NFT sale was unlocked, demand was overwhelming. This then led willing buyers to also pay abysmal Ethereum transaction fees. These have become necessary in addition to the actual price in APE because ApeCoin is an ERC-20 token and NFTs are also based on the Ethereum standard.

Ethereum had to deal with the ApeCoin moment.

Data from Ultra Sound shows how nearly 56,000 ETH Ethereum transaction fees for Burning came together in relation to Apecoin and Otherside. The volume was several times that of normal trading days for Ethereum, where the bulk of transaction fees come primarily from NFT marketplace OpenSea and decentralized crypto exchange Uniswap. During NFT sale hours for Otherside with ApecCoin, Ethereum transaction fees of up to $10,000 were temporarily charged – this momentum effectively suspended all other activity in the Ethereum ecosystem due to inefficiencies.

In hindsight, however, the Ethereum community finds some good in the situation: since transaction fees are partially destroyed (“burned”) automatically, they also have a deflationary effect for ETH. This principle has been in effect on Ethereum since the August 2021 update in London with EIP-1559. Thus, there is something positive to be learned from ETH which is worth the equivalent of almost $160 million now pulled from the market by ApeCoin and Otherside, with a deflationary effect for Ethereum.

Conclusion: stormy weather for ApeCoin.

Among so-called metaverse tokens, ApeCoin has so far been able to defend its top spot ahead of Decentraland (MANA) and Sandbox (SAND) despite falling prices. But shortly after the launch of ApeCoin, there were already serious criticisms of the APE concept, which was triggered by distribution mechanisms and perhaps only feigned autonomy. The repercussions of NFT sales for Otherside are unlikely to rank ApeCoin as strong. On the other hand, the Apecoin/Otherside project is still in its infancy and will still have opportunities to learn from its mistakes.

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ApeCoin (APE) Sees Prices Plunge After NFT Sales For Metaverse Otherside. – Tech Tribune France


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