As a result, Yuga Labs has publicly tasked the Bored Ape DAO to start planning a proprietary blockchain to alleviate such issues in the future.
Otherside Demand Crashes Ethereum
The Otherside NFT land mint was easily the most hyped up NFT mint the space has ever known, with the price of APE coin rising 145% in three weeks in the build up. However, the launch itself was a very messy affair, with gas prices hitting four figures as wannabe Otherside landlords pitched to get their slot:
FUN FACT: A user spent 16 #ETH ($43,000) in gas fees, to mint 2 of BAYC Otherdeed plots.
— Watcher.Guru (@WatcherGuru) May 1, 2022
This impacted every other dApp using the Ethereum network, meaning that not even the most basic Ethereum transaction could take place while the mint was going on.
Something to also consider is that Yuga Labs plans to airdrop a separate NFT collection of Kodas later this month. This would encourage secondary trading and possibly include customizing Kodas on any land you own!
The idea behind Otherside is that anyone can create their character. BAYC/MAYC/BAKC and CryptoPunk holders will be given 3D models of their NFTs when the game launches.
These models will be your character/avatar in this universe.
Additionally, Yuga Labs is developing an SDK for a user, or NFT project, to transform any NFT into a playable character. This means owners of projects such as Cool Cats, Cryptoadz, and World of Women will be able to use their NFT in the Otherside.
Yuga Labs, the creators of the Bored Ape Yacht Club NFT project, has proposed that the Apecoin DAO create its own chain after yesterday’s Otherside Metaverse mint caused congestion on the Ethereum blockchain network.
The team at Yuga Labs suggested an Apecoin Chain in a six-part Twitter thread in which they also pointed out that the mint had high demand, thus bringing with it unique challenges.
Initially, they had hoped that the challenges would be lessened through ‘a rigorous gating mechanism in the form of an on-chain KYC, a max mint of 2 per KYC’d wallet, and a significant clearing price at 305 ApeCoin.’
However, the NFT mint proved to be possibly the largest in Ethereum’s history, consuming a lot of ETH in gas, crashing Etherscan, and exceeding everyone’s expectations.
As a result, Yuga Labs came to the conclusion that an Apecoin Chain was perhaps the best solution, as seen in the following Tweet.
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.
— Yuga Labs (@yugalabs) May 1, 2022
Otherside Mint Was Quickly Sold Out, Raising $300 Million, and Spending 64k ETH in Transaction Fees
Besides the bottleneck of transactions on the Ethereum network caused by the Otherside Metaverse mint, the event resulted in the initial 55k Otherdeed NFTs being sold out, as explained by the team through the following statement.
The Otherdeed NFT mint is sold out – we are awestruck at the demand shown tonight.
As noted by CoinTelegraph, Reddit user u/johnfintech pointed out that some buyers shelled out anywhere from 2.6 ETH ($6,500) to 5 ETH ($14,000) in gas fees alone — more than the cost of an Otherdeed NFT (and in some cases, more than twice the cost). By the time the virtual land deeds sold out, buyers paid a total of about $123 million just to execute their transactions on the Ethereum blockchain (via Bloomberg).
Yuga Labs issued an apology on Twitter shortly after the mint ended. “We’re sorry for turning off the lights on Ethereum for a while,” Yuga Labs said. “It seems abundantly clear that ApeCoin will need to migrate to its own chain in order to properly scale.
Yuga Labs’s Otherside Metaverse NFT mint has dominated crypto and blockchain headlines since the day of the event, April 30th, because it shattered several industry records.
$320 Million in Apecoin Raised as Ethereum Gas Fees Skyrocketed
To begin with, the Otherdeed NFT mint allowed Yuga Labs to raise roughly $320 million in a few hours considering there was 55k NFT up for sale, each was selling for 305 Apecoin and the average value of APE on that day was $19.
However, behind the monetary success of the Otherdeed NFT mint lies another aspect of the event as demand caused Ethereum’s gas fee to skyrocket to as high as 8,000 Gwei, with one participant parting with $7k to mint two NFTs.
While I think incentivizing contributions from the community will be good for the health of the game, I do feel that the last mint was a bit unfair. We saw probably the biggest gas war in NFT history and did not receive transparency from Yuga Labs on their end. I hope Yuga rewards these people somehow in the next mint.
Yuga Labs paved the way for what it means to own an NFT through their licensing rights for both BAYC and MAYC.
Unfortunately, the licensing agreements for Otherside are definitely more restrictive.
One Twitter user pointed out that some collectors paid $3,500 in gas fees for NFTs valued at $550.
Much like trying to purchase Beyoncé concert tickets on retail website, blockchain network transactions can fail when sale traffic is high. Ethereum transactions can also fail if users don’t have enough to cover the gas fees that were unpredictably rising by the second on Saturday.
This Twitter user thinks Yuga Labs could have reduced gas usage by roughly 60% to 70% per transaction by removing something written into its smart contracts that caused the price to skyrocket:
I’m feeling like this poorly written smart contract that sucked $70M+ in unnecessary gas fees from innocent minters was done intentionally to push the narrative of their own chain and getting people to go for it.
Am I wrong? Seems too coincidental.
A numberofusers also reported losing thousands of dollars to gas fees in failed transactions. Yuga Labs promised to reimburse users for the gas fees associated with failed transactions, but it’s unclear what the refund process will look like. The Verge reached out to Yuga Labs with a request for comment but didn’t immediately hear back.
As outlined in a post days before the mint, Yuga Lab’s original goal was to avoid an “apocalyptic” gas war, or a sudden spike in gas fees due to high demand. It said it would ditch the popular Dutch auction style of minting, in which an NFT goes up for sale at a certain ceiling price and is then incrementally lowered over time.
But between the Ethereum network crash, the surging gas prices, and potential phishing scams, the NFT community has been vocalizing concerns about the project’s sustainability. Here’s a breakdown of what’s happening.
Why did Ethereum crash?
Two days before the big launch, Yuga Labs announced that the Otherdeeds mint would no longer take place via dutch auction format; the company detailed its reasoning in a blog post titled “Dutch auctions are actually bullshit.” Instead, Yuga Labs sold Otherdeed NFTs for the flat rate of 305 ApeCoin and limited sales to two NFTs per Know Your Customer-approved wallet in an attempt to avoid gas wars and surging fees.
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.
- Should Yuga Labs Have Charged More For Its Otherside NFTs? – Ep.349
- The Largest NFT Mint in History — Bored Ape’s Otherside Virtual Land Sale Raises $320 Million
- APECOIN обзор проекта | криптовалюта ape | NFT Yuga Labs | Bored Ape Yacht Club | апекоин
- Apecoin land sale time
- WTF is a Koda?! | Bored Ape Yacht Club Otherside NFT Mint Predictions