Azuki has also fallen, is the narrative of picture NFT over?

Author: Cookie, 0x26, Jaleel

Editor: Jack

Azuki's "Ice and Fire" performance has once again stirred up the stagnant NFT market.

During such a bear market, the Azuki Elementals, a new series from Azuki, sold out in less than 20 minutes at a price of 1 ETH. In less than 20 minutes, they raised 20,000 ETH (approximately $37.406 million), with over $2 million earned per minute. After the sale, people were "amazed" on Twitter and WeChat group chats. Some said that no one was interested in NFTs, while others said that it was really easy to make money in a bear market...

After more than 2 hours, Azuki Elementals opened the map, and everyone exclaimed "WTF". It's not because the new series looks too good, but because they were dumbfounded - is this a new issuance?

Azuki Elementals after opening the map

The anticipation before launching an NFT project is beautiful, but the disappointment after launching can be overwhelming. Many NFT players have resorted to mocking and criticizing the project using Azuki's promotional animation.

Community's ridicule of Azuki Elementals

Previously, Azuki's derivative series Beanz surprised everyone at the end of a party with the phrase "Check your wallet". With a successful case full of surprises, the Azuki community and even the market undoubtedly have high expectations for this Azuki Elementals. Especially since Azuki's official account released a 1-minute short animation on June 24th, everyone's appetite for "one bean per year" was definitely whetted by this animation.

The various problems during the sale process have also been criticized by its holders: dissatisfaction with the short 10-minute whitelist Mint window, dissatisfaction with the website overload causing Mint failure, and high repetition of various features with the first generation Azuki, holders are also concerned about the dilution of the value of the first generation caused by Azuki Elementals...

Due to the impact of the Kaitu incident, Azuki's floor price has dropped from 12 ETH to below 10 ETH, currently hovering around the 10 ETH mark, with a decline of about 20%. Judging from the voices on social media, the storm that Azuki is facing this time is no smaller than the negative news of its founder Zagabond's "Rug Pull Entrepreneurship" in the past.

Related reading: "Azuki faces trust crisis: new work questioned, price plummets."

Azuki Faith, how much is left?

Except for the Mint time of only ten minutes, which caused the website traffic to overload and crash in a short period of time, and the similar increase in the issuance of pictures, the most criticized by the community is that after the sale, the project party directly transferred 20,000 ETH. The transfer of 20,000 ETH has caused a lot of discussion, and many people cannot believe that this is the operation that a first-line blue-chip NFT team would make. Disappointment and suspicion abound in the community. However, regarding the team's transfer of 20,000 ETH and running away, some in the community also point out that the team transferred the funds to a multi-wallet for security reasons.

On June 25th, Sibel, co-founder of nftftc, said on social media: "This is the end of NFT... With Azuki and Ether, the two upcoming mints, this bloody market will lose a total of 50 million dollars. Although we are all playing the game of 'hot potato', I don't think NFT will return for at least 6 months. I am sorry for our loss."

KOL 0xSun (@0xSunNFT) expressed on Twitter that it's hard to believe the delivery quality of Azuki team, and all the dissatisfaction comes from misunderstanding. Currently, the team hasn't made any announcement after the map was released, and it's unknown how they will respond. If this set of replicated original maps is really all the content of Elementals, and there is no follow-up action or protection, then this sale can be said to be a naked harvest.

Before the release of the Azuki Elementals series, Christian2022.mid (@Christianeth), a whale with thousands of Ethereum in Azuki and Yuga, believed that Yuga's Ponzi logic was clearly unsustainable, and therefore looked forward to the story of Azuki from a narrative perspective.

In a previous interview with Christian by BlockBeats, Christian expressed his views on the NFT model of PFP: "If a team has no new ideas, no innovative power to drive the community, or no new business models and development directions, it will be difficult in the next cycle. I even think that Azuki's narrative is more attractive than monkeys, which allows them to maintain the value of the project even when the market sentiment is low."

Related reading: "Interview with NDV: Why did traditional asset management elites choose to heavily invest in GBTC when encountering crypto whales born after 2000?"

Christian, who owns over 470 BEANZ and 40 Azuki, prepared 1000 ETH for the sale of Azuki Elementals that night, hoping to maximize the liquidity of the entire NFT market. Upon waking up in the morning, Christian had 682 BEANZ and 410 elementals.

Despite many community members losing faith in Azuki, Christian made the decision to "recharge faith". He tweeted, "It is not wise to destroy a project worth billions (and the most loyal community on earth) to gain a profit of 38 million. I am willing to spend $40 million to buy the entire company."

Blue Chip NFT Titanic

Looking back at the performance of the past three months, regardless of whether it has a blue-chip halo or not, the NFT market has been showing a downward trend. The market value has dropped significantly by 23.64%, from 5.1 million ETH all the way down to 3.9 million ETH. Let's take a look at the blue-chip index. Although there was a brief rebound between May 31 and June 5, it also followed the overall downward trend - dropping from 85,000 ETH to 75,000 ETH, a decrease of 12.22%.

Many blue-chip NFTs have not been able to escape the baptism of the bear market:

Moonbirds

Moonbirds, as one of the fastest rising NFTs in the bull market, saw its price soar from 2.5 ETH at launch to 40 ETH in just a few weeks. However, Moonbirds, also known as "月鸟" in Chinese, failed to meet the community's expectations. This was not only due to the scandal of its former COO, but also its decision to change NFT to CC0 and the soft staking concept that did not meet expectations. As a result, the floor price of Moonbirds has dropped to around 1.5 ETH.

Doodles

Nowadays, the joining of Pharrell Williams, the creative director of LV menswear, couldn't save Doodles from drifting away from the community. The decision of Noodles co-founders to not follow the trend has hurt the Doodles community. The community has already criticized the Doodles team for inaction and setting up barriers for community communication (Discord). The decision to migrate to the Flow chain in early 2023 completely ignited the dissatisfaction of the Doodles community. After that, the floor price of Doodles dropped from 7ETH all the way to 1.5ETH, far from the peak of 22ETH. Joining is the only hope for Doodles.

BAYC

Even the NFT industry leader BAYC (BoredApeYachtClub) couldn't withstand the pressure this year, and its floor price has plummeted from a peak of 150ETH to 40ETH, and even briefly fell to around 34ETH. The drop in the past week has reached 14.92%. Despite the announcement of the launch of a new game HV-MTL Forge on June 29th, this has not brought a significant rebound to BAYC's continuously declining floor price. By observing the whales of BAYC, we can see the reasons for its sharp decline.

Franklin, who held more than 60 BAYC at the peak, sold off the vast majority of his BAYC due to numerous investment mistakes, causing panic in the community and even ending up deleting his Twitter account. Huang Licheng, the wild spokesperson for BAYC, has also expressed dissatisfaction with Yuga Labs, the parent company of BAYC, stating that the architecture of ApeCoin DAO is somewhat problematic and too centralized, resulting in the inability to realize the investment vision of the DAO. After experiencing multiple "roller coaster" trades on the NFT trading platform Blur, Huang Licheng ultimately chose to sell his BAYC. He has sold BAYC multiple times in June and currently only has one BAYC in his main account.

Related reading: "BAYC Holder Confession: From Swamp to Moon, Have I Lost Confidence in BAYC?"

Compared to Elements, Azuki and Beanz are undoubtedly much more "resilient", even going against market trends and successfully rising to become the strongest blue-chip projects. During the peak of the bull market, Azuki's floor price was over 30 ETH, and even just a few days ago it rose to 17 ETH. Not only that, the community atmosphere of Azuki is also a model of strong activity and cohesion in the bear market, thanks to its strong community support and product appeal. However, after the release of Elements, the community seems to have lost confidence in this "last blue-chip".

Of course, there are still some dark horses in the NFT industry in 2023, such as Milady, which is known for "not doing anything," and Punk, which remains exceptionally strong. As BAYC continues to decline, Punk has regained its position as the highest-priced blue-chip NFT, and even Milady has been favored by Elon Musk. Pudgy Penguins, the chubby penguin, has taken a different approach. After completing a 9 million financing led by 1kx, it announced that it would break through the circle by transmitting its IP to the real world. Its peripheral product, Pudgy Toys, went online and sold 20,000 items in just 48 hours, even winning the Toy Insider's Best Summer Toy Award for 2023.

Reflections on NFTs for Images

The delivery result of Azuki this time is really disappointing. After all, you received 37.4 million US dollars, but even some low-level errors appeared in the picture itself. NFT players "dig into the details" to find these low-level errors and ridicule, which also reflects how angry and disappointed everyone is.

Earning money so easily, has Azuki forgotten that taking money from users is for doing things? Setting aside the hype logic, starting with a picture to say that you want to do IP, and launching an independent game on Kickstarter is the same. Indeed, there are many people who buy in just for Degen, but as a project party, are you just setting up a "gamble", not only taking money to buy chips but also using royalties to extract water from users? From the first generation of Azuki to now, the sales revenue and royalty income are already enough. How much money has been spent on content creation that you still need to ask users for money?

The value of this "shell" of NFT has been squeezed out almost completely. Even if projects like Azuki come a few more times, the distrust between the project party and the users may be worn out.

Simply put, NFT is nothing more than a blockchain technology implementation. A picture sold for such a high price because it uses blockchain technology to store it. There is an element of gambling, as well as support and trust from people who love NFT and your vision. The biggest pain point for small image NFTs is that they are essentially just a "starting picture" with no additional content. Therefore, we need to create content and explore attempts such as IP on top of the content.

Other cultures that have already established a successful business model all have high-quality content that can both maintain existing users and attract new ones. For example, musicians can spend ten years perfecting their craft and releasing albums, even if they may not be successful every time. During periods of content creation lulls, fans can still appreciate their past works and continue to consume them. What can small image NFTs do? Rely on people to drool over them every day and fantasize about their own metaverse avatars? We can easily imagine that if Azuki was not an NFT and these images were seen at an offline cultural and creative market, would you be willing to spend even 100 yuan to purchase them? After bringing them home, how long would you remain interested in them?

So everyone can see how difficult it is to create small image NFTs, and the community is struggling to find new topics to discuss beyond the daily fluctuations in value. People invest in the hope of seeing breakthroughs, but so far there have been no significant deliveries. The website is updated, a few clothes are made, and a few parties are thrown, but after more than a year, does this really match the amount of funding raised?

We have gone through a complete investment cycle, and many projects have been proven false. Everyone also understands the development direction of the entire market. Looking back at the early hot full commercial IP authorization of BAYC, the community and artists have integrated BAYC into various creatives: beer, neon signs, merchandise, coffee, bars, burgers, stories, comics... BAYC has spawned numerous art derivatives. But at some point, BAYC changed, and its cultural output gradually lost.

In this case, Christian2022.mid (@Christianeth), co-founder of NextGen Fund and WeirdoGhostGang, believes that in the next cycle, new blue-chip NFT projects must have two characteristics: first, they must be able to attract more outsiders to join the community through cultural output; second, they must move from virtual to real, with real products and sustainable business models, so that everyone can see the value of Web3 and what they are doing. Christian said this is also the reason why he chose to invest in The Weirdo Ghost Gang project.

First create content, then bring out the product, and run a sustainable business model. This is a very difficult process, but it is the necessary path for NFT to accumulate real value. It is already 2023, if NFT is still only used to build crazy gambling games, how can we expect the future of NFT?

It's time to go back and drop this "shell". What we did wasn't that amazing, we just used blockchain technology to store an image and explored new possibilities. If you think you can make a lot of money by doing NFT projects, or just focus on speculation and making money without caring about others, from the project side to the users, you will definitely be stuck in the old narrative within this circle, and it will be really difficult to move forward.

Projects with money can do more interesting things, but projects without money don't need to give up. Starting from a "small online store" selling peripheral products, is it impossible to grow? It's just that the road is difficult and people are not willing to walk it. The narrative of NFT images is far from over, but we need to be more honest with ourselves - this is a difficult path. If you work hard and persevere, you will find that users have been around you all along.

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