Millions of heads are sweeping the Internet, starting with OpenSea, the super platform behind NFT

"Crazy crazy crazy." Xia Jiahua, founder of Solestage, a sneaker store with 140,000 followers, typed these four characters on the morning of Aug 31. The picture shows "Your product has been successfully sold" with a turnover of 7.39 ETH, about 24,000 US dollars.

Three days before Xia's post, it was discovered that top NBA star Stephen Curry's Twitter avatar had changed to a monkey. This is not an ordinary monkey, this is a picture of a monkey on the chain, and through the transparent path of the blockchain, people found that Curry spent 180,000 DOLLARS for this picture of a monkey as a head.

For curry, who earns $44 million a year, it only takes him 16 minutes to play, but the $180,000 figure clearly shocked the Internet when compared to an image you can right-click to save as. News fermentation is not long, douyin hot search first.

Xia was no exception. His $24,000 photo was part of curry's monkey collection, and as a veteran sneaker who has been ahead of the curve and seen hundreds of thousands of shoes, he was obviously stunned by the price.

Remember, these monkey pictures, when they first appeared, only cost 0.08 ETH, which is a few hundred RMB. Over the course of a few months, the returns were ridiculous.

This is the epitome of the current coin circle. The coin circle has always been the pronoun of the wealth effect. "Outsiders are getting interested." "People started asking me how TO play NFT," said Zhou LAN, an NFT player.

Under the influence of NFT, THE trading volume of OpenSea, an NFT trading platform from Y Combinator, has increased exponentially, with a monthly GMV of 3 billion DOLLARS, ranking among the top 1000 websites with the most traffic in the world. OpenSea is the biggest beneficiary of the NFT's insane wealth effect in this story.

Textbook Silicon Valley startup

It's a textbook case of Silicon Valley investing.

In recent years, YC incubated projects by investing $125,000 in return for a 7 percent stake, according to investors. After acquiring YC's investment, YC uses its influence and charisma in the market to help the companies it invests in obtain higher valuations. Generally speaking, the worst companies are valued at $8 million three months after receiving YC investment, and the average company is valued at between $10 million and $12 million. If it is a star company, the valuation will increase at least 20 times, reaching 40 million to 50 million yuan.

OpenSea's activities in the capital markets have almost followed the same path that YC has taken with its incubators.

Devin Finzer is a graduate of Brown University, where he interned at The Wikipedia Media Foundation, Google Cloud, and Flipboard. After graduation, his internship led him to join Pinterest, then the hottest waterfall photo platform in Silicon Valley. During Devin Finzer's tenure, Pinterest was the third-largest social platform in the U.S. behind Facebook and Twitter. After leaving Pinterest, Devin Finzer decided to work for himself. OpenSea is Devin Finzer's third venture.

Before winning the favor of YC, Devin Finzer originally planned to apply for the incubation of YC with a shared WiFi broadband project using blockchain. However, after entering YC, he was influenced by CryptoKitty and established OpenSea instead.

In its early days, OpenSea received $120,000 in funding from YC, valuing the company at around $1.8 million. Four months after the YC investment, OpenSea raised another $2 million. In an interview, Devin Finzer said YC created an environment that brought the company more attention from investors. In such an environment, the financing of enterprises is more likely to cause fOMO of institutions.

Under the YC model, the OpenSea Angel round financing amount is only $2 million, There are Foundation Capital, The Chernin Group, Founders Fund, Coinbase Ventures, Blockchain Capital, Blockstack, and The Stable Fund, 1confirmation and other 8 institutions participated. OpenSea, which raised its angel round of funding, is not soaring, but still waiting for the wind to blow. In terms of positioning, Devin Finzer sees OpenSea as more like Ebay, growing from the long tail of smaller games and projects that need a market.

Alex, the other co-founder and CTO, graduated from Stanford University, where, like Devin, he interned with Apple and other silicon Valley companies. Subsequently, he worked as a technical lead at a number of technology-driven companies.

OpenSea's founders have the resume of a typical Silicon Valley entrepreneur, an Ivy League or Stanford graduate who spent his college years interning at FAANG. After graduating from university, I started my own business after a short part-time job.

In terms of corporate structure, OpenSea has always been small and beautiful, with a team of just seven people for most of 2020. Even in 2021, the team will be 37 people.

These 37 people now handle hundreds of millions of dollars in NFT transactions every day.

The bad boys of Silicon Valley

In March 2021, under the background of global release, influenced by Metaverse stories and the era of Z gamers entering the mainstream, the number of user addresses of OpenSea began to show explosive growth, rising from 15,000 to 48,700, an increase of up to 224%. At the same time, trading volume also began to expand, the first monthly trading volume exceeded $100 million, reaching $147 million.

Looking at the soaring numbers, A16Z, known as the bad boy of Silicon Valley, began dipping its hand into OpenSea, just as it had done in eight deep rounds with Coinbase, only this time it was more decisive and generous. In March, A16Z led A $23 million Series A round for OpenSea.

The market was so hot that early adopters' dissatisfaction with OpenSea's outages and slowdowns began to spread, and there were "suggestions" for OpenSea to upgrade its servers in the social and media markets.

The OpenSea outage and congestion did not cool the market. More and more users flocked to the NFT field. Modern artist Takashi Murakami, fireworks artist CAI Guoqiang, boxing champion Mike Tyson, Argentine soccer star Lionel Messi, VISA, Coca-Cola, beer brand Budweiser and many others have announced their launch of NFT-related businesses. Meanwhile, the spread of "Play to earn" NFT games like Axie Infinity and meme cultural NFT like Bored Ape Yacht Club and Pudgy Penguins are also driving the growth of the industry. What is even more absurd is that some absurd and completely blank pictures can be bought for 4 ETH, equivalent to 85,000 RMB.

All this seems to be back to 2017 IC0, investors in the primary market at all costs crazy buying, selling in the secondary market, in their eyes, now NFT head, there is no possibility of breaking, buy is to earn.

The frenzied market allows the leading NFT platform to gather global liquidity and become more mature.

At its peak, Curry's monkey, NFT (Bored Ape Yacht Club), was selling more than 500 pieces a day, according to NFT Stats. If you count them as shares or tokens, they change hands at a rate of 5%. From the data, it is easy to find the traces of market makers and capital entry, the turnover rate quickly pulled high to stimulate the volume, then, the floor price continues to drive up. From time to time, there are one or two cases of sky-high sale of monkeys, stimulating follow-up users to enter, and finally the floor price is higher and higher.

Source: NFT Stats

In July, A16Z went on to lead a $100 million Series B round for OpenSea. OpenSea's Series B funding also valued the company at $1.5 billion.

Four years ago, YC invested $120,000 for shares that were valued at nearly $100 million three years later, delivering a return of more than 800 times.

In August, OpenSea saw $3.057 billion in volume, which is more than OpenSea's total volume in the past four years combined. Under the OpenSea fee rules, OpenSea will charge 2.5 percent of the value of a transaction, which means that in August, OpenSea generated more than $76 million in revenue. The $1.5 billion valuation falls far short of OpenSea's true value if it can maintain its August growth.

In such a market mood, NFT actually has a bit out of the original original mind, from the original can be the right of the meta-universe virtual assets, evolved into the hype now.

No matter how good the IP, no matter how beautiful the product, no matter how hardcore the concept is, it is not as quick and fast as the wealth effect. After the IP operation, encryption art baptism of NFT, with the classic wealth effect completely broke out. IP has audience limit, art has aesthetic threshold, wealth effect is universal.

However, only under the wealth effect can a giant emerge, just like the shanzhai coin that ran out of the current single quarterly profit of $3 billion binance, multi-point flowering NFT, OpenSea's monthly GMV of $3 billion, just started.

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