It’s not everyday that the hottest two projects in an explosive asset class merge.
That’s what happened on March 11 when Yuga Labs, the company behind Bored Apes Yacht Club (BAYC), announced the acquisition of the intellectual property rights (IP) of CryptoPunks. The market responded as dramatically as you’d expect: Bored Apes’ floor has jumped 18% to almost 90.0 ETH, while Punks’ is down 6% to 72 ETH.
The two projects were within less than one ETH of each on the day of the announcement, with BAYC’s floor at 76 ETH and CryptoPunks’ at 76.34, according to a Dune Analytics dashboard which compares the two. At $1.4B according to CryptoSlam, BAYC has the second largest sales volume of all-time, trailing only CryptoPunks, which is $2.1B.
Yuga Labs also acquired Meebits’ IP as part of the deal; both Meebits and CryptoPunks were created by Larva Labs. The BAYC creator is now drafting new terms and conditions for its two new collections per the company’s announcement of the acquisition.
Restrictive and Murky
CryptoPunks was famously embroiled in a controversy late last year when the NFT collection’s restrictive and murky, copyright led Punk4156, the well-known founder of Nouns DAO, to sell his namesake punk for $10.2M worth of ETH.
With Yuga Labs’ acquisition, the company plans to grant CryptoPunks and Meebits the same commercial rights that BAYC holders have, which allow holders to do things like display their specific Bored Ape on a basketball shoe.
The reactions to Yuga’s move were close to shock — Bored Apes and Punks have always been seen as neck-and-neck competitors. “Yuga Labs just acquired the rights to Punks and Meebits,” tweeted Zenenca, an NFT investor and content creator. “I’m basically speechless now; wow. This is huge. What’s everyone’s first reaction?”
Mixed is the answer. In a way, the acquisition emphasizes the dissonance of copyright issues as a whole in crypto, which is, after all, a place where open-source code is the norm. If someone can fork your code and do it better, that’s generally considered fair game. SushiSwap’s fork of Uniswap is a prime example.
Having to think about what a person is allowed to do with their asset contrasts with the self-sovereignty of owning BTC or other cryptocurrencies — the whole point is you can do what you want when you want.
On the flipside, Yuga Labs looks to be loosening up CryptoPunk’s restrictive IP, which may allow them to better steward the project and bring it closer to a decentralized ethos. Indeed, Larva Labs itself tweeted that the company was ill-equipped to continue to grow CryptoPunks and Meebits at this stage in the projects’ maturity.
Crypto influencer 0xquit, is thinking that the acquisition represents progress for CryptoPunks. “Yuga said they plan to let the collection be,” they tweeted. “Their only plan is to give punk holders something they have been asking for a long time: commercial rights over their punks. And now you fade it?”
DCinvestor, another influential voice in the Ethereum community, thinks NFT projects with a Creative Commons license (CC0), may emerge as winners in the aftermath of the acquisition. “Yes, I’m buying up a bunch of CC0 NFTs,” the influencer tweeted a day after Yuga Lab’s made its announcement. “I’m sure it’s just a coincidence that I’m doing it today,” he joked.
DCinvestor did tweet that he thought Yuga Labs will be “OK” stewards of CryptoPunks for the time they own the collection’s IP, but generally appears uncomfortable about supporting the project now: “I’m just not gonna work to promote their corporate IP.”
The influencer changed his profile picture to an image of the CC0-licensed, mfers collection in the days following Yuga Labs’ acquisition.
Still DCinvestor hasn’t written off proprietary IP models entirely — he agreed with another influential CryptoPunk holder, 6529, that the standards for NFTs are still in flux, and that some people may accept projects with business-owned commercial rights.