BAYC Breaks Ethereum & MSCHF Managed
Otherside crashed Ethereum's blockchain, and MSCHF's latest lawsuit
Cultured is a newsletter that gets readers up to speed on the most interesting things going on at the intersection of finance, art, collectibles, NFTs, and more. Cultured is produced by Otis, an alternative investment platform that was recently acquired by Public.com.
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🗞 STORIES OF THE DAY
BAYC’s new metaverse project crashed the Ethereum blockchain
Yuga Labs, the company that owns BAYC, unveiled its plans last week for a new metaverse called Otherside in partnership with Animoca. The game is part of Yuga Labs’s grand plan for the franchise, which involves building out a massive virtual world.
Days later, Yuga Labs announced a sale of Otherdeeds, tokens that correspond to plots of virtual land. Demand skyrocketed, causing transaction fees on Ethereum to soar and halting transactions elsewhere on the blockchain.
Plots of land were only available to BAYC owners and cost a flat $5,800 in ApeCoin, the franchise’s token. The transaction fees were about 2 ETH, more than the cost of the Otherdeed that was minted. In total, Yuga Labs brought in around $320 million.
Our Take: A major part of the new BAYC ecosystem may be its own blockchain.
The fact that a single project could have such a large impact on the entire Ethereum system was concerning for many crypto enthusiasts. Given that ApeCoin transactions are only going to increase with the launch of Otherside, it’s clear that an alternative is necessary. Yuga Labs has asked the holders of the tokens to consider migrating to their own blockchain, a move that would prevent a similar occurrence in the future.
MSCHF’s Wavy Baby sneakers were banned by a judge for copyright infringement
A judge in Brooklyn ruled against MSCHF in a copyright infringement case brought by Vans. He also issued a temporary restraining order, which blocks MSCHF from selling the shoes. Not that it matters, though — the shoes sold out weeks ago.
Vans’s lawsuit claims that the Wavy Baby shoes rip off their Old Skool design. MSCHF says it’s an art project that critiques consumer culture and is therefore protected by the First Amendment.
The setback has broader repercussions for MSCHF. If MSCHF loses the full case, which this temporary ruling suggests it might, it would have to compensate Vans. More likely, MSCHF will do the same thing it did with Nike and settle out of court to avoid a trial.
Our Take: MSCHF’s rapid drop model is its main guard against the effects of these lawsuits.
MSCHF tends to drop sneakers in limited, one-time batches and with little notice. That’s a good strategy for avoiding the impacts of these lawsuits. As MSCHF noted in its filing, the company doesn’t plan to make future batches of the Wavy Baby sneakers, making the restraining order pointless. Given that the sneaker company has already done this twice, there’s a strong chance it’ll continue to take this approach in the future.
✨ AROUND THE INTERNET
A game-worn Kobe Bryant jersey from the player’s rookie season could fetch $5 million at auction. That would break the record set last year by another Bryant jersey.
Investors are snapping up three and four-number Ethereum domains, sending the price of the tokens to record heights.
Old Topps USFL cards from the 1980s are a hot commodity and prices are shooting up. But don’t expect a second set any time soon.
Marcus Jordan, MJ’s son and a sneaker dealer, is mired in accusations that he’s been prioritizing resellers for his Air Jordan collabs.
A massive 6-foot bottle of scotch may break the record for the most expensive bottle ever sold.
