What can ApeCoin do? Understand the Bored Ape BAYC ecosystem token in one article

Original Title: Bored Apes NFT project gets official 'ApeCoin' token

Original Author: Lucas Matney

Translation: Deep Chain Finance Tanker

As one of the fastest-growing crypto startups, Yuga Labs has experienced a particularly explosive year.

The crypto startup Yuga Labs is the parent company of the NFT project "Bored Apes" (BAYC). Since its launch in April last year, the project has rapidly grown to become the most valuable NFT project in the market by market capitalization. Currently, the cheapest of the 10,000 "Bored Apes" NFTs is priced at around $240,000. Reports indicate that the startup is seeking to complete a new round of financing with a valuation of $5 billion. Previously, there were rumors that Yuga Labs was heavily promoting a token called "ApeCoin" in preparation for entering the P2E (play-to-earn) gaming space.

Perhaps Yuga Labs also realizes that to achieve further growth, relying solely on million-dollar ape NFTs will not attract the interest of Silicon Valley venture capital firms; only by turning its attention to new gaming areas and issuing tokens can it join the mainstream crypto economy built around these IPs. Just last week, Yuga Labs announced that it had acquired the CryptoPunks and Meebits NFT series from Larva Labs, including brands, artistic copyrights, and other intellectual property.

In the past, you might have thought that crypto companies had a hard time attracting the attention of Silicon Valley venture capitalists, but in reality, as the value of these "apes" images has soared to millions of dollars, Yuga Labs has gained favor with investors. Meanwhile, Yuga Labs hopes to deeply stimulate the mainstream crypto economy built around its IP through gaming and tokens, thereby further accelerating market expansion. Last week, Yuga Labs announced the acquisition of the CryptoPunks and Meebits NFT series developed by Larva Labs, and they plan to provide all commercial rights of these two NFT series to the holders. At the same time, Yuga Labs stated that the BAYC ecosystem will still be the "center of its universe," and the acquired NFT series will not be forcibly integrated into the "club" model developed for BAYC. Yuga Labs will strive to bring additional utility to the CryptoPunks and Meebits series and will fully listen to community opinions before deciding on the next steps.

Understanding ApeCoin

Frankly speaking, establishing this gaming crypto economy requires some very special legal measures to ensure compliance. To a large extent, the U.S. Securities and Exchange Commission has kept its distance from NFT projects—though not entirely so—but crypto startups selling tokens that act as unregistered securities have been targets of regulatory scrutiny, which has kept many crypto companies on guard.

Therefore, Yuga Labs is very cautiously "separating" the company entity itself from the token issuance.

The "ApeCoin" token will be issued by an entity called ApeCoin DAO, which consists of council members associated with the NFT project, but none of them are employees or executives of Yuga Labs. Additionally, they will establish an organization called the APE Foundation to manage the governance decisions of ApeCoin DAO, which will carry the official branding of the BAYC project, with Yuga Labs "donating" the blue Bored Apes logo of the 1/1 NFT to the organization.

If all of this sounds a bit confusing, 2022 is indeed considered the "year of compliance for cryptocurrencies."

The council members of ApeCoin DAO include Reddit co-founder Alexis Ohanian, FTX's Amy Wu, Sound Ventures' Maaria Bajwa, Animoca's Yat Siu, and Horizen Labs' Dean Steinbeck.

According to a spokesperson for ApeCoin DAO, token holders will be able to vote on decisions within the DAO, while a special committee "will execute community decisions." Although Yuga Labs will not officially launch the Ethereum-based token, the startup and the founders of the BAYC project will hold nearly a quarter of the token supply, while holders of Bored Apes and Mutant Apes NFTs will collectively receive 15% of the total token allocation.

A Yuga Labs spokesperson noted that they expect the Ape token to "soon" start trading on major exchanges, including Coinbase, FTX, eToro, Kraken, OKX, Gemini, FTX, Binance, and Binance US. However, the startup did not allow any executives to be interviewed and declined to provide more details about the relationship between ApeCoin DAO and Yuga Labs.

The complete breakdown of the 1 billion APE token allocation is as follows:

1. 8% will go to the founders of "Bored Apes" BAYC.

2. 16% will be donated to the Yuga Labs team (of which 1% of the total token supply will be donated to the Jane Goodall Foundation Legacy Foundation).

3. 14% will be allocated to "launch contributors," presumably consisting of Yuga partners and investors.

4. 15% will be donated to the owners of the Bored Apes and Mutant Apes series.

5. 47% will be released over time as part of the DAO's "ecosystem fund."

What Can ApeCoin Do? Gaming or Entry Point

As for the utility of the ApeCoin token, it is currently unclear what the full range of uses for this token will be, but it is evident that ApeCoin is likely to serve as an in-game currency for certain games that Yuga Labs is developing. Yuga Labs previously announced a partnership with the San Francisco game studio nWay, although the game being co-developed has not yet been officially announced, nWay has released several combat games based on physical IPs, such as Power Rangers and WEE.

The game being developed in collaboration with nWay has not yet been given an official name, but it is almost certain that they will adopt a "play-to-earn" P2E crypto game mechanism, allowing users to earn tokens based on the time and effort they invest in the game. In fact, the play-to-earn game mechanism has already become quite popular in Axie Infinity, which completed billions of dollars in NFT transactions over the past year and propelled its parent company Sky Mavis to a valuation of $3 billion.

However, Yuga Labs has revealed that the new game will be released in 2022.

Interestingly, this game is likely to complement a previously announced play-to-earn game launched in collaboration with Animoca Brands, and Yuga Labs has also pointed out that ApeCoin will play a role in existing Animoca games, such as "Benji Bananas."

On March 17, reports indicated that Yuga Labs also plans to launch an independent game called MetaRPG, which will be compatible with many NFT projects and may involve virtual land sales this year. Reports also stated that as the company accelerates the application and promotion of the play-to-earn game mechanism, its net revenue is expected to reach $455 million this year, but Yuga Labs declined to comment on related reports.

From 2021 to 2022, NFTs experienced tremendous hype and received support from many leading tech companies. For example------

• Twitter launched limited support for NFT profile pictures;

• Facebook recently announced plans to integrate NFTs into Instagram;

• Stripe recently also launched support for NFTs.

Moreover, NFTs have sparked strong opposition from consumers, especially gamers, who are concerned that NFTs will not truly democratize game ownership but instead promote speculative trading. Additionally, some industry insiders have expressed concerns about the minting of NFTs and the environmental impact of energy-intensive blockchains.

Clearly, Yuga Labs' foray into the gaming space is an important part of its growth plan for the BAYC brand, but blockchain gaming remains a "niche" field, and as Yuga Labs enters and expands its openness, the market size may accelerate its growth.

Yuga Labs CEO Nicole Muniz previously stated, "I don't know how big the market for BAYC can be in the future; of course, that doesn't mean I don't believe BAYC has a future, but I hope Yuga Labs can achieve further development and drive us to create many unique and special things and communicate with a larger community in different ways."