PFP NFT projects lead market trends, accounting for 70% market capitalization share

PFP (Profile Picture) NFTs are one of the earliest applications of NFTs, designed to serve as online identity markers for users. Among various NFTs on Ethereum, PFPs account for 70% of the total market capitalization, far exceeding other types. Generative art and virtual land rank second and third with shares of 13.5% and 8%, respectively.

The popularity of PFPs can be attributed mainly to their easy-to-understand characteristics and ongoing market hype. The release of new projects and related announcements often sparks market enthusiasm, driving up floor prices and attracting more attention from traders and collectors.

Since the success of BAYC (Bored Ape Yacht Club) in April 2021, many new projects have followed its model. BAYC's dominant position in the PFP ecosystem is very significant, with its market capitalization exceeding the total of its major competitors by more than four times. This success can be attributed to its strong community building capability, as well as the support and attention it has received from numerous celebrities.

However, relying solely on hype cannot sustain prices in the long term. The BAYC team realized this and took active measures to differentiate themselves from competitors. They launched the $APE token and the Otherside metaverse project in the first quarter of last year, further solidifying their position.

Other top PFP projects are also creating unique ecosystems in order to stand out in the competition. Most projects have also received funding support from well-known venture capital, with Azuki being an exception.

Azuki has achieved success by building a clear, community-centered ecosystem. The upcoming Hilumia project is expected to become a virtual hub that integrates gaming elements and visually showcases the content created collaboratively by the team and the community. In the future, Azuki may continue to focus on expanding its IP, encouraging community participation in content creation, and initiating higher-level visual storytelling.

RTFKT (Artifact) has adopted a different strategy by supporting its project narrative through multiple airdrops. This year's key project, Animus, is expected to tie all elements together and unveil the next chapter of their legend. RTFKT aims to expand the IP of Clone X through interactive storytelling. They are expected to continue this plan this year and may further leverage Nike's brand effect.

Doodles recently released their DoodleMap, clearly showing their intention to become a major entertainment and lifestyle brand that transcends Web3 and penetrates mainstream consciousness. With the appointment of a new CEO and the acquisition of an animation studio, Doodles is focusing on expanding to mainstream audiences, starting with Doodles 2 on the Flow blockchain.

The year 2023 will be a crucial year for these projects, as they attempt to break through the Web3 circle and expand to a mainstream audience. Although facing many uncertainties, as the saying goes, "You can't catch tiger cubs without entering the tiger's den." Whether these projects can successfully expand to new audience groups and sources of revenue remains to be seen.