In April, the largest land rush in the brief history of the metaverse raised approximately $320 million from the sale of 55,000 parcels of virtual land in Otherside, an immersive world created by Yuga Labs, stewards of the Bored Ape Yacht Club collection of NFTs. The newly minted community cemented BAYC’s ascent from monkey JPEGs to a metaverse franchise in its own right—a trajectory any Web3-curious brand would kill for. But the stampede carried other costs, including an estimated $181 million in “gas fees” to pay for the electricity necessary to issue titles on Ethereum’s blockchain. At least one buyer paid eight times in gas fees what his plot cost in “ApeCoin.”
In this regard, BAYC’s triumph is a warning for brands as well. Amidst the push for greater ESG (environmental, social, and corporate governance) by customers, investors, and government regulators alike, companies can’t be caught shilling NFTs and other tokenized assets that seemingly contradict their public pledges to sustainability. At the same time, the recent plunge in the prices of blue-chip cryptocurrencies underscores how the recent NFT boom has raised the stakes for brands eager to experiment in this space. To that end, it’s important to focus on Web3’s unique community and utility while bolstering its sustainability through alternatives to energy-intensive blockchains. Rather than fret about electricity consumption, take a step back and strategize instead. “If energy usage is your first concern, stop that right now and make it community,” advises Brandon Aaskov, global crypto lead at the technology and marketing consultancy DEPT.