Analysis of the Reasons Why PFP NFT Market Dominates

PFP (profile picture NFTs) is one of the earliest applications of NFTs, primarily used as a personal profile picture for online identity. In addition to aesthetic appeal, its success has other driving factors.

In the Ethereum NFT market, PFP accounts for 70% of the total market cap, far exceeding the second-ranked generative art ( 13.5% ) and the third-ranked virtual land ( 18% ).

The main reasons for the popularity of PFP are its easily understandable characteristics and market speculation. News and announcements can trigger excitement, driving up the floor price and attracting the attention of traders and collectors.

Since the successful launch of the BAYC project in April 2021, many new projects have attempted to replicate its successful model. BAYC dominates the PFP ecosystem, with a market value more than four times that of its main competitors combined. This success can be attributed to factors such as its strong community building.

In addition, BAYC has attracted the attention of several celebrities, such as singer Justin Bieber, actor Steve Aoki, and NBA star Stephen Curry, which undoubtedly increased the project's engagement and awareness among the general audience.

However, in the long run, the value of the project needs to be supported by fundamental factors rather than purely relying on speculation. The BAYC team recognizes this and has proactively launched the $APE token and the Otherside metaverse project to consolidate its market position.

Subsequently, other PFP projects also began to create unique ecosystems in order to stand out in the competition. Most top PFP projects, except for (Azuki, have also attracted large investments and support from well-known venture capital.

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The Azuki project has achieved success by establishing a community-centered ecosystem, and its upcoming Hilumia project is expected to further integrate its ecosystem. Hilumia may be a virtual hub that incorporates gaming elements, showcasing content co-created by the team and the community.

The RTFKT team focuses on multiple airdrop activities, each targeting different application scenarios. This year's key project, Animus, is expected to connect the various parts and open the next phase of its narrative. The team plans to advance its metaverse expansion plan in three stages.

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The Doodles project recently released the DoodleMap roadmap, showcasing its ambition to become a cross-border entertainment and lifestyle brand. The project has hired experienced executives and plans to acquire an animation studio, demonstrating its determination to expand into the mainstream market.

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Doodles officially launched the Doodles 2 series on the Flow blockchain, marking the beginning of a multi-chain layout. The choice of Flow is mainly due to its gas-free transactions and potential composability. In 2023, Doodles may continue to expand into various entertainment fields such as gaming, music, and animation.

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The future success of PFP projects relies not only on airdrops and financial incentives but also on establishing an emotional connection with users through storytelling and unique value propositions. While retaining existing users, it is equally important to attract new audiences and explore new sources of revenue.

These projects have established a strong community foundation in the Web3 space and are moving in an exciting direction. 2023 will be a key year, as many projects will attempt to break through the Web3 circle and enter the mainstream market. Despite facing uncertainties, opportunities and challenges coexist.

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