YUGA Labs, the creator of the popular Bored Apes Yacht Club collection of NFTs, shepherded a sale of virtual land related to its highly anticipated metaverse project, raising about US$320 million in the largest offering of its kind. Demand was so strong that activity related to the event caused ripple effects across the entire Ethereum blockchain, disrupting activity and raising transaction fees.
Holders of the ApeCoin cryptocurrency who verified their identities jockeyed to buy deeds for the 55,000 parcels of virtual land in Otherside, the project’s planned metaverse game.
Anticipation of strong interest had pushed up the price of ApeCoin earlier this week ahead of the sale of the plots, Ethereum-based NFTs called Otherdeeds.
Each plot cost a buyer around US$5,800 based on ApeCoin’s price of US$19 as of Saturday (Apr 28), plus transaction costs, or “gas fees” in Ether, which skyrocketed after the sale went live at 9 pm New York time as the land grab attracted heavy demand.
“Yuga Labs’ virtual land sale has triggered one of the highest spikes in transaction fees on Ethereum,” said Jason Wu, founder of decentralized lending protocol DeFiner. “I have seen other NFT launches causing high gas fees, but this is definitely one of the highest,” Wu said.
Minting a token or making a transaction on Ethereum requires token creators or traders to pay a fee to those that order transactions on the network. Transaction fees go higher when the network becomes congested given more fees are needed to prioritize a transaction. That can impact the Ethereum-based business of apps like Uniswap, effectively slowing the transactions on these other platforms.