Quirkies Defies NFT “Norms” | An Analysis
Overall, there’s not enough market data to consider ANY project normal, but I’ll take the stated market “norms”, dissect them a bit from a data analytics perspective, and examine how Quirkies breaks the mold.
Many in NFTs didn’t come from an investing background and don’t know what to look for. Hell, half of “investors” don’t know what to look for. The FOMO in stocks/options is just as high as NFTs, but there’s more positions to buy in order to influence the market and share price. I’ll be using a few projects as examples, but am NOT stating if they are a buy, sell, or avoid. I’m simply looking at FACTS through data, and facts don’t care about feelings.
Comparing projects is VERY difficult to do. There are so many variables for which one must account. The basic two are holder percentage and listing percentage. But what most miss is timing, cost, and investors. I’ll discuss a few below and give my take on what it means.
Cool, But Who TF Are You?
Good question! I’ve started and sold 2 businesses, scaling by focusing on marketing and customer acquisition statistics. I’ve also made a couple bucks playing poker full time for 2 years which requires probability and statistics, as well as reading your opponents and predicting their next moves. Additionally, I worked security and counterintelligence for the NSA and DoD for 7 years. This involves finding common denominators, anomalies, outliers, etc., and using them to predict enemy mindset and movement so we can eliminate them. Considering troop lives were at stake, I’d say the need to be accurate was pretty damn high. And I did all of this good enough to retire when I was 34 BEFORE I entered the NFT arena. BUT, enough tooting my own horn. Also, don’t follow me for the above purposes, I mostly post shit memes and my PFP is under $100k 👀.
Holder Percentage
Why does it matter? Well, if I started a project with 1,000 pieces, and my mom owns 800 (80%) of them, future buyers may be hesitant to invest because they would wonder if the demand is there. Do other people want this, or just his mom? So finding the right demand to supply correlation IS important. People have been hesitant on Quirkies because they have a 44% holder rate, and the “norm” for projects is 60% — or let’s say, the “desired” holder rate. Okay, based on what? I don’t see data that says more projects with 60+% holder rates are more successful than 40% rates. And I can literally name 10 off the top of my head that met that threshold and failed, or are dying.
What factors influence holder percentage? Well, price for one. The reason so many people buy hyped up projects, is because they have less than 1e and are looking for a quick win. The vast majority of us started like this in the past year and I’m not saying anything negative about those people — I was one (my 1–100e challenge). So if the entry point for a project is high, they can’t buy in. And if a project grows quickly, it is put out of reach that much faster — with or without a 60% holder rate. Quirkies in this case saw their floor rise significantly three times and quickly put the price out of range for the vast majority in the space. This is why you see so many people thrilled to get a WL spot for Quirklings (v2 if you’re new to Quirkies).
Initial holders bought multiple Quirkies early on and didn’t let go. 63% of holders have 1 Quirkie (Chart 1 below). 87% have 1–3. So if I simply looked at the “what “ (holder percentage of 44%), and compared it to the “norm” without looking at the “why” (convicted early buyers), I may just assume whales are sweeping them up and there’s an inorganic growth and sustainability. In fact it’s the opposite, only 2.49% of holders have 11+ Quirkies (that’s 54 people out of 2.2k). Only .19% have 50+ (that’s 4 people). So…by only one chart, that FUD is debunked.
To show what I consider “early conviction”, 23% of holders have been holding since day 1, and a combined total of 49.5% have held since the first pump (Chart 2 below). Moving on…
Timing
Timing impacts holder count. Ah yes, timing. We all know most men don’t have it and ruin most chances of a date because their timing of jokes, compliments, etc. is trash. So obviously here we are in a male dominated arena, forgetting to include timing (I’m a man, I can say it). Timing is everything. Very simple example: releasing a project while eth is down 50% — not a great time. Releasing when people are excited about the crypto market — good time. We can probably all agree with that point. Why did Bored Ape Yacht Club (BAYC) do so well and go so high? While their founders have proven to be legit, for the first 6–8 months of the collection, I’d say timing. There was no where else to put your money! Obviously a slight exaggeration, but you didn’t have 9 million projects coming out everyday like we see now. What the hell else would you buy? Then as NFTs became a bit more mainstream, BAYC became the grail. IF another project goes to a 100e floor, it will be a hot minute. There are so many projects promising great returns that investors flock to day in and day out that they’ve diluted the market.
Even still, BAYC didn’t hit a 60% holder spread until Dec 2021– 8 months after beginning. So WHO says 60% is the “norm” for success? The “influencers” that want everyone to go buy their exit game project?
Go sort Opensea (as below) and on the right choose “Items”. Then scroll to find the 5–20k collection projects. Open the ones that have over a 60% holder spread and tell me how they’ve done over time. I’ll answer for you — 90% suck. So WHY should the magic number be 60% when the small data samples we have already shows a great amount of failure and/or stagnation?
Comparing Tesla to Ford and saying both make cars, and more people drive Fords, so they are better, leaves so much missed data for the future. And if you stopped there and bought Ford stock over Tesla 5 years ago, you’d have made 20% today on Ford instead of 700% on Tesla. That repeats itself time and time again in the market. SO…if you used the same “norm” NFT logic on this example, you’d have left a lot of money on the table.
YOU HAVE TO ACCOUNT FOR MARKET DISRUPTORS!
Listing Percentage
What is it? Simply put, it’s the percentage of a collection that is listed for sale. Why does it matter? The number of a supply listed can help determine the demand the market has for it. For instance, when Twinkies were temporarily pulled from the market a few years ago, a single Twinkie sold on eBay for $600. Something that cost $1 one week when supply was abundant, now was worth 600x because of speculation of the demand of Twinkies. Bringing that to NFTs, what does it mean? From a birds-eye view, an abundance of a collection for sale (Twinkies before they were pulled) can make investors assume demand is low and their investment will not grow as quickly as they would like. However, if only a low percentage are for sale, the speculation is there will be more demand than supply (Twinkies AFTER they were pulled) and the price will go up quicker.
The key to focus on here is the speed at which the investment rises. Obviously we all want our bags to become more valuable, but is quick always best? Well, are you an investor or a flipper?
Are you embracing a project, its community, and its business plan; or simply letting hype direct your day’s flip? I challenge you to take a look at the bags of flippers and see what they’re holding. Do they hold/trade solid projects, or mostly pump and dump projects? Look at the timing of their buy/sell transactions. Look at how much capital they are investing with through etherscan. True they could have multiple wallets, but generally they will have one MAIN trading account. If they’re investing 50% of their worth into a flip, I’d bet my house they don’t last long. If they seem to have a disciplined approach and invest a small percentage into multiple projects, they probably know what they are doing and can sustain, BUT they are NOT looking to stay in a project for more than a week or two. So next time you hear someone throw out the “norm” stats, take a look at their wallet and determine the type of trader they are.
When you’ve seen a very quick rise in floor price because of news, does the floor stay that high or come crashing down?
As an example, since eyes are always watching our ape friends, Mutant Ape Yacht Club (MAYC) rose to over 40e when Yuga was preparing to drop land. Listings maintained below 10% (the desired “norm”), but in the weeks after, the floor settled back down to below 20e. Am I saying MAYC is a bad investment? Absolutely not. It’s simply shows that a sharp incline, even in blue chips, is fantastic in the short term, but doesn’t sustain afterwards — it’s standard speculation of a market. This speculation of investor actions is why you see projects pump pre-reveal, and then fall just before or just after reveal. Why is this happening?? The pre-reveal drop is because flippers (and I’m not using this term to be offensive — I trade weekly options, so I’m right there with you, just not in assets) anticipate, or speculate the project will drop on reveal when people see they didn’t mint a 1/1 or high rarity, and immediately floor it to leave or flip it into a more rare piece in the collection. And that is exactly what the post-reveal dip is. A recent example of this would be HAPE (and again, I’m not stating an opinion on ANY project, simply looking at facts). Pre-reveal they rose to a 8e floor and post reveal they cut in half. Why? Speculation of short term investor actions. From what I can tell there were no other major outliers.
Quirkies did the opposite, and by the end of day 1 had doubled their mint price. Then tripled mint price on day 2. Mint was .05e and I started watching at .11e. Finally, I started buying at .18e. This didn’t stop — it didn’t just shoot straight up and fall back down, it kept going. Sure, there were 10–20% corrections, but you never saw the floor cut in half. Within 4 weeks those minters had 40x their investment and priced out the majority of new investors in the market. But remember, 23% of minters and 49.5% of investors during this time are STILL HOLDING. So with a relatively quick incline with little hype buying, Quirkies became a 44% holder spread while quickly reaching a 2e floor price. They peaked at 3.6e, and currently, through the crypto dip, are still maintaining a 2.65e floor which is 35% higher than a week ago. And STILL while maintaining the conviction of holders.
One important piece to note here about the limited hype buying is Quirkies have spent basically $0 on marketing, decreasing that probability. Their community handles this for them through Twitter and word of mouth. They have Twitter Spaces 1–3 times EVERY DAY. Their onboarding is fantastic, and even a 1/1 holder created an entire website to help…for FREE! Having spent tens of thousands of dollars on marketing in my previous businesses, trust me when I say, word of mouth from brand ambassadors trumps all — and this is what the Quirkies team has. This keeps team overhead low, and cash flow high to create their vision. And I’m not talking about a bogus roadmap, but a legitimate business with short term and long term (5–10 year) plans. Which brings me to my next point…the team.
Founders/Team
I’ve seen many projects that are based around an artist. Now this is good since we are buying art, but not exclusive since projects are building a business or brand.
“But, I care about the art!”
If you were truly in this market for exclusively the art, you’d have much more 1/1 art rather than generated collection pieces. Now don’t get me wrong, I love the art in my wallet, and FinchONE did an INSANE job with so many traits, but I’m not JUST here for art, I’m here for money. And if you’re scoffing at me right now, you are too or you wouldn’t be running after the next degen derivative collection.
If you want to create a business, you need more than an artist — you need a project/program manager. I have a design team of 10 that are ridiculously good at each of their specialties, but all of them would tell you they either don’t want to or can’t run a business. So, I bring them work, we both get paid, and everyone is happy. I can’t do what they do, and they can’t, or won’t, do what I do — we each have our own talents. And there’s nothing wrong with that! An artist should spend all their time creating and not HAVE to worry about anything else! And this is what Syn does so well. He listens to the investors, manages the project, and ensures everything aligns to keep everything in synergy. And no, I’m not getting paid to say this!
As John Maxwell wrote, “Everything rises and falls on leadership.” Without leadership, there’s no mission, vision, or focus. Without these three pieces, a business has no future. Syn has all three and it thrives throughout the team and community.
I’ve seen creators with failing projects posting their $100k NFT acquisitions on Twitter while their investors are holding negative bags — bags THAT they sold them! Now, there’s nothing wrong with buying other projects and enjoying the money, but let’s say I own a struggling apparel business and post my new Louis Vuitton bag or Gucci jacket — do you think investors are going to take me seriously? No. I should be hustling my brand. Selling at a freaking flea market or on a corner if I need to. Not flaunting what I bought with THEIR money while they’re left holding the bag. Syn doesn’t do this even with our floor being higher — he’s hustling 24/7.
A business must reward its investors or it will not survive. Which takes us to the final point — investor sentiment.
Investor (Market) Sentiment
What is it? Investor Sentiment is a belief about future cash flows and investment risks that is not justified by the facts at hand. It’s the optimism or pessimism of the market players which is evident in the overall price trends. In NFT terms, it’s what the market expects the collection to do, and how investors react to that feeling. “Not justified by the facts at hand” is the kicker here when looking at Quirkies and compare it to NFT “norms”. It IS the reason for the holder spread and listing percentages they have. I explained the 44% holder spread above and this is why — investors anticipate great things and continue to hold. Version 2 (Quirklings) has been announced, but just recently a spin was added that holders will receive pieces that correlate with their current piece’s token ID number. That, mixed with the fact that there is NO official rarity for the collection, increases buying, trading, and “upgrading” based off news and collection conspiracies (in a good way).
“If that’s the case, why are there more than 10% listed? Wouldn’t they just delist them?”
Well, that’s what we’ve been told is the “norm” and that’s how we’ve been told to react.
Remember, Quirkies is run as a business and this attracts business minded investors. In investing there’s something called a Stop Loss (a price you enter to sell automatically, so if the stock price dips below you don’t end up losing as much), but in this case there’s also a Take Profits Order (TPO). TPO is just a sell order stating “I want to sell my positions automatically if the price reaches XX”. Using both of these tactics allows an investor to manage their portfolio and not have to pay as close attention to the investment daily. It also raises the offering price (price offering to sell). So if a stock is at $100 and no one is offering to sell for less than $105, the next buy order takes it up 5%. If it dips too much — auto sell. If it spikes — auto sell. If you look at the Quirkies floor in more detail than just the overall percentage listed, you will see the vast majority of offerings are priced well OVER the floor price and in unison with the traits on that piece.
Here’s the overall listing number right now:
And here’s the number listed at least 2x the floor price:
There are currently 12.1% of Quirkies listed. BUT 6% of those are priced OVER 2x the price of the floor. So what does this mean in relation to all the mumbo jumbo I mentioned above? Investors value their pieces higher and price them accordingly. They are willing to sell, but ONLY if it reaches a price they see is high enough. At the same time, when a pump occurs, those same investors generally readjust their “TPO” and set it higher, or delist all together.
If you look at BAYC, it’s the exact same statistic (Not comparing the 2 projects, just pointing out the stat similarities with a blue chip NFT):
The last piece I’ll mention is the amount of trading that takes place inside the Quirkie community. The vast majority of the Quirkies on the floor are from holders with more than 1 who are making moves to buy a more rare Quirk or are using the funds to trade into one. The amount of trading that occurs is huge and I would bet is only matched by BAYC/MAYC. Now, I’m not willing to die for that stat, but I’d place a wager.
Closing Thoughts
If the intelligence field taught me one thing, it’s nothing is EVER as it appears. BUT human nature is the same whether you’re a terrorist or degen in mom’s basement. Human nature tells us to follow. Follow the “influencers”, follow the NFT stat “norms”, follow me on Twitter 👀, etc. Leaders do their own research and make their own destiny.
Quirkies doesn’t follow.
It’s still early, but my money (figuratively and literally) is on Quirkies continuing to break the NFT “norms” and be a trendsetter for years to come. After all, we aren’t just concerned about the 11% of the world who currently own NFTs, we’re also after the 9.4% planning on getting in. And why stop there? Let’s go grab the rest of web2 in the process.
