Yuga Labs Raises $285 Million With “Otherside” Metaverse NFTs
Yuga Labs, the team behind Bored Ape Yacht Club, held its much anticipated digital land sale on Saturday evening, marking the debut for their metaverse project called “Otherside.”
While the Otherside land sale generated approximately $285 million for the company, it also resulted to some of the highest gas fees in the history of the Ethereum network. Over the past 24 hours, investors spent over $176 million on fees alone.
Otherside is the largest product launch from Yuga Labs, best known for creating the Bored Ape Yacht Club NFT (non-fungible token) collection. Last night’s sale witnessed, traders buying a limited supply of 55,000 “Otherdeeds” NFTs, which represent titles to plots of virtual land in a forthcoming 3D social space.
One Otherdeed was priced at around $7000 each, and were only available for purchase in ApeCoin (APE), Yuga Labs’ official cryptocurrency. On secondary marketplaces like OpenSea, the cheapest listed price for an Otherdeed was around 7 ETH (~$19,000).
Ethereum Clogged
Related to last night’s fee-related issued, the company issued a public apology on Twitter saying:
“This has been the largest NFT mint in history by several multiples, and yet the gas used during the mint shows that demand far exceeded anyone’s wildest expectations […]”
“[…]We’re sorry for turning off the lights on Ethereum for a while.”
We're sorry for turning off the lights on Ethereum for a while. It seems abundantly clear that ApeCoin will need to migrate to its own chain in order to properly scale. We'd like to encourage the DAO to start thinking in this direction.
The average fee for an Ethereum transaction typically scales with the overall congestion of the network; when traders scramble for the same tokens at the same time, prices go up for everyone. It’s a phenomenon known as a “gas war” – users compete to have their transactions processed at the top of the miners’ queue.
According to dune Analytics’ calculator, the average gas price was hovering around 800 Gwei early Sunday morning, with spikes in the realm of 6000 and 7000. During the spikes, a simple transaction (say, sending a few dollars’ worth of crypto to a friend) could cost upwards of $3,000.
Last night’s events added to the question of Ethereum’s long-term viability as a host for large-scale NFT projects. Yuga Labs themselves have even toyed with the idea of building its own dedicated blockchain as they noted in the apology thread.
In April this year, Yuga Labs raised $450 million from venture capital giant Andreessen Horowitz and Animoca Brands among others.
