What is ApeCoin (APE)?
Among the NFT projects, the team behind the creation of ApeCoin stands out, which did not limit itself to collections, releasing its own metaverse and cryptocurrency in addition to them. In this article, we'll look into what ApeCoin is, its features, and whether this project has any prospects.
What is ApeCoin?
ApeCoin (APE) is an Ethereum network (ERC-20) token issued by ApeCoin DAO, an organization known in the Web3 industry. The APE token does not have a blockchain but has various uses in the project ecosystem, including the metaverse.
ApeCoin DAO is a decentralized autonomous community-driven organization and part of the global ecosystem of Yuga Labs, a company founded in 2021 by NFT enthusiasts who have released some of the most widely used NFT collections in the cryptocurrency environment with colorful names:
- Bored Ape Yacht Club (BAYC);
- Mutant Ape Yacht Club (MAYC);
- Bored Ape Kennel Club (BAKC).
As of March 2024, Bored Ape Yacht Club's NFT collection has a total trading volume of over 2 million ETH (~$7.9 billion), a capitalization of 141,959 ETH (~$562 million), and a Floor Price of 13.4 ETH (~$56,000) for its digital copy.
In 2022, the Yuga Labs team raised $450 million at a $4 billion valuation to develop their metaverse, Otherside. Since then, the team has focused on using NFT tokens, which should increase their value and create additional revenue streams for Yuga Labs.
Functions and market performance of the ApeCoin token
APE fulfills the roles of utility tokens and management tokens. As a management token, ApeCoin gives its owners the right to influence the development of the entire Yuga Labs ecosystem and vote for proposals in the ApeCoin DAO community, which is essentially its center.
APE also has utility token functions, which are used as a means of payment in the Otherside metaverse. Users can use them to buy virtual plots of land and other NFT objects and exchange them for other digital assets via an exchange or marketplace. In addition, users can even pay for purchases at some stores of world-famous brands such as Gucci and Tag Heuer across the globe.
The third use case for ApeCoin is the DeFi market. Users can trade the token by exchanging it for other cryptocurrencies on the Ethereum network, providing liquidity on decentralized exchanges like Uniswap and SushiSwap, depositing it as collateral, and receiving credit in other digital assets via lending protocols.
APE token holders receive additional privileges, such as access to private events from Yuga Labs, the right to receive free tokens from partners (airdrop), and others. APE tokens can also be received for free by owners of NFT-arts from the Bored Ape Yacht Club, Mutant Ape Yacht Club, and Bored Ape Kennel Club collections.
The cap on APE token issuance is set at 1 billion, and as of March 2024, approximately 604.5 million APEs — 60.5% of all existing ones — had already been issued in the market.
The price of the APE token has dropped significantly since its March 2022 launch. Immediately after listing on exchanges, the APE rate reached $8, but as of March 2024, it was only $2.4, indicating decreased interest among investors and traders.
This is also confirmed by market data: while at its peak in May 2022, the price of NFTs from the BAYC collection was 153,700 ETH, and daily trading volume reached 12,700 ETH, by March 2024, these figures had dropped to 13.4 and 787 ETH, respectively, reaching a two-year low.
ApeCoin ecosystem
One of the ecosystem's centerpieces is ApeCoinDAO, where APE cryptocurrency holders can vote on suggestions for improving ApeCoin.
The BAYC, MAYC, and BAKC collections released by the Yaga Labs team have created a separate Bored Ape NFT ecosystem, also managed by the Apecoin DAO community.
The third key element of the ApeCoin ecosystem is the Otherside metaverse, which consists of various NFT objects:
- Virtual Plots of Land (Otherdeeds);
- Mystical creatures called Koda;
- Resources that correspond to the four essential elements of the land and are required for construction in the Otherside metaverse;
- Artifacts that can be discovered and used to sell or increase the value of the virtual plots of Otherdeeds.
The ApeCoin project has the support of major partners from the Web3 and Web2 industries, including Gucci, Adidas, Animoca Brands, and others.
What are the prospects for ApeCoin?
Even the growing crypto market hasn't helped the world-famous NFT collections released by the Yuga Labs team to increase trading volumes and prices for the popular bored monkey pictures. In the last three months alone, the minimum price for Bored Ape Yacht Club NFT art has almost halved from 27.5 to 14.2 ETH, but trading volumes have increased by about the same amount over the same period.
Investors and traders are paying more attention to fresh NFT projects, such as Mavia, Memeland, and Mocaverse, as well as memcoins. These are the focus of the growing trend in the crypto market that started in the third quarter of 2023.
NFTs and metaverses are still new and little-explored areas, the future of which is rather vague. Nevertheless, Precedence Research analysts forecast the metaverses market to grow from $92.46 billion in 2023 to $5,028.57 billion by 2033, but it is not yet clear whether Yuga Labs will regain its dominant position in the market or surrender it even more.
