Formerly rich NFT buyers celebrate through the pain – TechCrunch

Welcome back to chain reaction.

Last week we talked about infinite pessimism in the crypto markets. This week we’re talking parties and tattoos and alcohol and fun.

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exit option

It’s no secret at this point that many viewers are watching the crypto crash with glee and laughter as tokens tumble and NFT volumes shrink. The crypto industry has managed to garner plenty of consumer enmity during this bull run — with critics citing aggressive energy consumption, the addictive profile of crypto investing, and how NFTs have become “MLMs for dudes” — as justification for their dislike.

As the bull market comes to an end, here’s probably a good moment for some introspection on how investors’ web3 vision for the internet can give consumers more joy than skepticism, but something tells me the crypto industry is about to shut itself down further than ever.

This week, NFT residents descended on Times Square in New York. Costly images made their way onto the giant advertising screens, token-gated parties flourished, and a bevy of suddenly less wealthy collectors found their way to regret and double down. My co-host Anita had the opportunity to visit NFT NYC in person and shared some thoughts below, but in a way the upbeat sentiment shows an industry shifting from growth mode to survival mode.

The survival version of the NFT world looks a little different, of course. At this week’s event, the Bored Ape Yacht Club hosted a festival that featured performances by Future, LCD Soundsystem and Amy Schumer. Tame Impala hosted Kevin Rose’s Moonbirds event where token holders could get owl tattoos on the spot. The NYPD has blasted token-gated NFT parties. One project hired dozens of protesters holding signs that read “God hates NFTs” to stand in front of their event. An NFT startup hired a Snoop Dogg impersonator “Doop Snogg” to walk around their event as a tacit pseudo endorsement.

In the end, it’s no secret that the NFT market has been filled with a ton of bullshit, and any bear market could and should give some sanity back to what was left behind, but the lines in NFT land are looking a little blurry.

In a way, it feels like the wealthy collectors of NFT space are plummeting into space while the world they built prepares for a meltdown. So-called blue-chip projects with more than 10 ETH floors, venture funding, and significant trading volume have shown surprising resilience in the face of the downturn, despite falling values ​​of the underlying cryptocurrencies they are based on, but NFT projects have floors broader Front has suffered major setbacks as less affluent collectors seek exit liquidity where they can and fight their way all the way down.

the latest pod

We started this week’s episode by unpacking some controversy stirred up by none other than the DoGFather himself – Elon Musk. Musk and his companies SpaceX and Tesla, being sued by a Dogecoin holder for alleged inflation of the value of the cryptocurrency that has since crashed.

It’s time this week for NFT NYC, a crypto conference that has lured influencers, investors, celebrities and the like to New York (more on that below from Anita, who’s hopping around town speaking to the NFT community). We took a deep dive into the NFT market itself and what might be driving the seeming exuberance of the NFT space even amidst such dismal crypto and technology market conditions at large. We wrapped up this week’s news with two DAO-related disasters that may not bode well for the future of this recently trending but undeniably chaotic governance structure.

Music and visual artist Latasha joined us on the podcast this week to talk about how NFTs have helped her claim ownership of and make a living from her creative work. She shared her vision behind Zoratopia, a festival experience she has hosted at crypto events across the US in her role as Community Lead at NFT platform Zora.

Subscribe to Chain Reaction Apple, Spotify or your alternative podcast platform of choice to keep up with us each week.

follow the money

Where startup funds are moving in the crypto world:

  1. FalconXa digital asset platform for institutional investors, announced a $150 million Series D round at a valuation of $8 billion led by GIC and B Capital.
  2. NFT collector project doodles attracted an undisclosed amount of funding from Alexis Ohanian’s Seven Seven Six.
  3. Solana-based NFT marketplace Magical Eden raised $130 million in a Series B round co-led by Electric Capital and Greylock Partners, taking its valuation to $1.6 billion.
  4. Top notch trusta crypto and fintech infrastructure startup, has raised $100 million for its Series B from investors including FIS, Fin Capital and Kraken Ventures.
  5. Permissionless Margin Trading Protocol OpenLeverage snagged a strategic investment of unknown size from Binance Labs.
  6. Comedy and meme tooling company based in NFT Terrible Petsa project by the producers of the Silicon Valley TV show, raised approximately $4 million in funding led by First Round Capital, XYZ Capital and Moment.
  7. Astariaan NFT liquidity provider, closed an $8 million seed round from investors including True Ventures and Arrington Capital.
  8. final statea sneaker-focused NFT platform raised $5.5 million in seed funding from investors including Archetype and Castle Island.
  9. Algorithmic Exchange Rate Log growth raised $1.56 million for its ParaFi-led seed round.
  10. Afropolitan Raised $2.1 million in pre-seed funding from Balaji Srinivasan and other investors to build a digital nation-state for Africans and the African diaspora.

this week in web3

Hey, this is Anita covering (pretty much) live from NFT NYC this week. Everyone living in Manhattan, myself included, was surrounded by a flood of enthusiastic Degens this week dismissing the downturn. You can listen to this week’s podcast to hear my thoughts on all of this, but I want to address a different question here: Is the crypto community practicing what it preaches?

There were countless complaints on Twitter from people who waited in line for hours to get their NFT NYC passes. Even those speaking on panels had to line up with all the event attendees, they told me, which appeared to stretch as much as three city blocks.

I’ve lived in New York for a while now, so I’m not easily shaken by a long line, but it got me thinking about the irony of the whole thing. NFTs and associated technology can enable simple authentication and identity verification. NFT professionals like to cite events as the main use case for the technology, which they say could make administrative tasks like checking people into a conference so much more efficient. So where is this technology at this week’s conference?

I am certain that hosting a crypto event is about bringing order out of chaos in a way that is way beyond my own ability, so I am not singled out for the organizers at NFT NYC or anyone in particular. But the lines at NFT NYC raised a bigger question, in my mind, about the contradiction between what the crypto community is says is the future compared to how the crypto community actually behaves. Why are face-to-face meetings such a big part of meeting people in web3 anyway? Shouldn’t we all have passed the point where we have to breathe each other’s air to feel human connection?

Based on what I’ve heard from much of the Web3 community over the past year, I would have expected that by now we would all be hanging out with our best friends in the metaverse 24/7. Crypto conferences themselves, it seems, represent a huge opportunity for Web3 enthusiasts to actually use the technology they say will change everything about our lives. So far it seems as if this opportunity has been largely overlooked.

TC+ analysis

Here’s some of this week’s cryptanalysis, available to read on our subscription service TC+ (written by TC’s Jacquelyn Melinek):

Crypto’s emphasis on community could throw followers off a cliff
The idea of ​​the “family” culture that so many companies are pushing is permeating deeper and deeper into the crypto world as communities with a sometimes toxic, cultish attitude are formed to steadfastly support the projects they have invested in. Don’t get me wrong, some parts of the crypto community are great – I’m a member of a few communities myself – but when abused it can lead blind people to blind people.

Crypto founders face falling valuations and pull deals amid market volatility
As the crypto market continues to plummet, founders in the space are struggling to hold on to investors who are now trying to de-risk and pull out of funding rounds. The market is shifting towards a VC-friendly landscape, but not every founder is happy with the way they’re being treated now that investors are back in the driver’s seat.

Thanks for reading, and again, if you’d like this in your inbox every Thursday you can sign up for TechCrunch’s newsletter page. Until next week!

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