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Could ApeCoin be the Metaverse’s token?

What’s up with these smart, funny, but boring-looking monkeys that continue to make headlines? Many collectors argue that it is less about the image itself and more about the culture, social capital and wealth gained through the Bored Ape Yacht Club (BAYC) to the community of owners that give the collection its value. With a total volume of over $1.42 billion, the community trusted the creators to deliver on their promise for the token issuance.

On March 17, BAYC’s utility and governance token, ApeCoin (APE), was made eligible for BAYC and Mutant Ape Yacht Club (MAYC) holders. According to data, nearly 99% of eligible wallets have already claimed their share, and over 132 million tokens worth $1.8 billion have been claimed.

As expected, APE price fluctuated at both ends of the spectrum as it plunged over 80% to a low of $6.21 on the first day of trading and rallied 90% on the second day. Of the 1 billion tokens created, 15% were distributed to owners, leading many crypto natives to speculate on its impact and impact on the Web3 economy.

BAYC has been a pivotal force having a major impact in accelerating cultural change and NFT adoption. A month after its release, APE is already sparking conversations about governance protocols, its usefulness within the metaverse, and its steady acceptance as a universal form of payment in the NFT space.

ApeDAO guides the community will and future of ApeCoin

ApeDAO is the decentralized autonomous organization that launched ApeCoin. As the governing body, the DAO is directed by the APE to submit proposals from its members on what is best for the community, and these proposals are later voted on by the APE holders.

While there are many DAOs out there, ApeDAO could potentially be a catalyst for a paradigm shift between ‘consumer’ and ‘owner’. APE has the potential to mass tap large communities as it has the potential for an incentive structure with its DAO.

Despite all these possibilities, DAOs, which may seem solid on paper, are not the easiest level of decentralization.

In most cases, projects start out as a centralized entity, team, or organization, gradually moving to more decentralized methods of equitable distribution. This is not an easy undertaking and requires an incredible amount of time, coordination and active commitment from the members.

The biggest challenges for DAOs are that code-is-law and active coordination among members must first be agreed upon. ApeDAO is not immune to the challenges most DAOs face and is already under attack for certain Ape Improvement Protocols (AIP).

AIP-4 and AIP-5 focus in particular on the allocations for the staking pools (AIP-4) and the three-year duration of this first staking period (AIP-5). Both were written by Animoca Brands, a major investor in decentralized gaming platform.

These proposals shed light on the rough terrain of navigating between differing opinions and intentions, while narrowing the process down to a mutually beneficial consensus. The details of the staking proposal said that over the course of 3 years, 17.5% of the total ApeCoin supply would be distributed and funded by the Ecosystem Fund. The staking protocol would also consist of different staking pools whose APE distributions vary depending on the asset staked.

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AIP-5 Incentive Distribution. Source: ApeCoin

Loud NFT residents took to Twitter about the proposals as such felt rushed and appeared to benefit venture capitalists rather than the community.

In the eyes of Animoca Brands, APE’s intention outside of governance is to be the preferred token of the metaverse. However, to do so, Animoca Brands advises incentivizing participation in the staking protocol, whether via APE or a BAYC ecosystem NFT.

Over 10 million APE (nearly $150 million) will be used to determine this vote and both AIPs are still up in the air. This is undoubtedly a high price to pay for an offering deliberately created to introduce newcomers to the metaverse.

ApeCoin could be a useful resource in the metaverse

Although APE is not equity in Yuga Labs, it provides access to the BAYC ecosystem. APE also serves as a means of payment in their forthcoming release of MetaRPG, a Metaverse platform.

Yuga Labs raised $450 million to create and develop this new metaverse, valuing the company at $4 billion. The forthcoming interoperable world aims to be fully decentralized and will strategically work with other gaming studios to achieve this Other sideYuga Labs’ massively multiplayer online role-playing game (MMORPG) comes to life.

Since the Other side is not exclusive to those who own BAYC properties, those with APE can equally participate and benefit from the play-and-earn game. Although Yuga Labs is not responsible for creating the APE token, Nicole Muniz, in a statement to CoinDesk, CEO of Yuga Labs, said that it will “adopt ApeCoin as the primary token for all new products and services,” indicating that If this is the case it could be a valuable investment.

Yuga Labs, specifically BAYC, has already been called an NFT monopoly by thought leaders, and with its recent token issuance, the value of APE is tied to the health of the BAYC collection.

Currently, the total market capitalization of APE is almost $3.4 billion and there are approximately 169 million tokens in circulation out of a total of $1 billion. APE is up over 95% from its all-time low and is currently trading at $12.05.

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APE/USDT 4 hour chart. Source: TradingView

Traders are speculating on the token’s likely value because ApeDAO describes APE as the token that crosses culture on Web3 through gaming, arts and entertainment.

Based on the success of BAYC, culture has played a crucial role in introducing new participants to NFTs and Web3. Due to the cultural relevance of BAYC within the ecosystem, companies, organizations and retailers want a piece of the pie.

On the topic: fact or fiction? Has ApeCoin (APE) Really Down 80% Since Launch?