ApeCoin ($APE): Review of cryptocurrency and DAO within the global ecosystem of Yuga Labs

ApeCoin ($APE): Review of cryptocurrency and DAO within the global ecosystem of Yuga Labs

ApeCoin emerges as a groundbreaking addition to the Bored Ape Yacht Club, diverging significantly from traditional NFT projects. At its core, ApeCoin functions as a voting share within the Bored Ape ecosystem. Holding $APE tokens grants membership in the DAO, empowering individuals to propose Ape Improvement Proposals (AIPs). These proposals wield substantial influence, shaping crucial aspects such as rules, partnerships, governance, and more within the ApeCoin DAO.

You might think we’re discussing yet another insignificant token, considering the abundance already present in the market. However, this is an entirely different case.

In this article, we will delve deeper into what makes Apecoin so unique in the evolution of the cryptocurrency world and why it stands as a true beacon in the future of financial technologies and decentralized governance. Let’s immerse ourselves in the captivating realm of Apecoin and explore how it is reshaping our understanding of cryptocurrencies and blockchain.

What is ApeCoin?

Running on the Ethereum blockchain, ApeCoin operates as a fungible ERC-20 token, empowering decentralized communities at the forefront of Web3 technology. The $APE token serves multifaceted purposes, including governance, granting access to specific areas of the APE ecosystem, incentivizing third-party developers, and acting as a unit of spend throughout the APE ecosystem.

Through the implementation of community governance, developers have successfully nurtured a diverse and self-sustaining ecosystem. This approach ensures that every ApeCoin holder possesses voting rights, embodying the project’s inherently democratic and inclusive nature.

Here are some key statistics for your reference:

  • The token made its debut in March 2022.
  • Its market capitalization hovers around $400 million.
  • The total supply of the token stands at 1,000,000,000.
  • Currently, there are 368,593,750 tokens in circulation, accounting for 36.86%.
  • The token reached its highest price on April 29, 2022, with 1 $APE valued at $23.65.
  • As of now, the token’s value stands at 1 $APE = $1.08.
ApeCoin Price Chart (APE) all time
ApeCoin Price Chart (APE) all time

What functions does ApeCoin perform?

ApeCoin serves four primary functions:

  1. Governance: It acts as a governance token within the APE ecosystem, enabling ApeCoin holders to actively participate in the decision-making processes of the ApeCoin DAO.
  2. Unification of Spend: ApeCoin functions as a utility token, offering a common and decentralized currency accessible to any ecosystem aiming to embrace a shared, open medium of exchange, eliminating the need for centralized intermediaries.
  3. Access: It serves as a key to unlock exclusive parts of the ecosystem, providing entry to restricted areas like exclusive games, events, services, and merchandise that would otherwise be inaccessible.
  4. Incentivization: ApeCoin facilitates seamless involvement in the ecosystem for third-party developers. These developers have the freedom to integrate APE into their services, games, and other projects, utilizing it as a tool for incentive-based participation without requiring explicit permissions.

Relationship between ApeCoin and Bored Ape Yacht Club

ApeCoin (APE) emerged as a groundbreaking marvel within the crypto realm, intertwining its fate with the renowned Bored Ape Yacht Club (BAYC) and Mutant Ape Yacht Club (MAYC) NFT holders from its very inception on March 17, 2022. The ApeCoin journey kicked off with a spectacular ride: from an initial price of ~$8, it swiftly soared to a peak of $39.40 before settling around $10, all within its inaugural 24 hours of trading.

By the end of April, ApeCoin’s value surged organically, fuelled by both “meme-power” and the anticipation surrounding the launch of a mysterious metaverse known as The Otherside, unveiled by its creators, Yuga Labs, on April 23, 2022. The Otherside stood as an open metaverse, with ApeCoin as its native currency. A significant milestone came with the minting events for The Otherdeed NFT collection, featuring 200,000 virtual land plots within The Otherside. Each plot, priced at 305 APE (~$6,100 based on $20/APE at that time), could only be acquired through ApeCoin exchange. BAYC or MAYC holders were entitled to claim an Otherdeed plot for each BAYC or MAYC NFT they possessed.

The price surge leading up to The Otherdeed mint showcased the potent economic impact of ApeCoin’s role as a sought-after currency. However, ApeCoin’s value has experienced fluctuations, resting at an average of ~$5.60 in Q3’22, highlighting its volatility when demand falters.

Despite its nascent state, ApeCoin has embarked on a promising trajectory, steered by the ApeCoin DAO. With influential supporters and developers tirelessly working to enhance APE’s utility, The Otherside represents just the beginning of a series of groundbreaking announcements.

The connection between ApeCoin and Bored Ape Yacht Club is intricate yet distinct. The birth of ApeCoin is attributed to the APE Foundation, an entity responsible for overseeing ApeCoin and executing the decisions of the ApeCoin DAO. Although closely aligned, the genesis of ApeCoin is distinct from Yuga Labs and BAYC. Notably, BAYC’s involvement in the early stages of ApeCoin was announced publicly in October 2021, indicating a shared vision.

Crucially, the ApeCoin DAO’s initial members predominantly comprised BAYC and MAYC holders, given their eligibility for the initial airdrop claim. Approximately 39% of APE’s total supply is closely tied to BAYC stakeholders, fostering a robust incentive alignment between the BAYC community and the ApeCoin DAO.

As over 60% of the token supply remains locked, future decentralization is anticipated, diversifying the holder base and reshaping the ApeCoin DAO’s priorities. While decentralization unfolds, the symbiotic relationship between BAYC and ApeCoin communities is poised to endure, especially with The Otherside metaverse, developed by Yuga Labs, integrating ApeCoin as its primary currency. This integration serves as a blueprint, potentially enticing other Web3 communities to adopt APE, promising mutual benefits for early adopters and holders. The evolving landscape hints at a future where ApeCoin, driven by a community-driven ethos, shapes the trajectory of the metaverse ecosystem.

Apecoin allocation

ApeCoin, with its fixed supply of 1 billion tokens, stands as a testament to its unwavering commitment to integrity. The protocol’s contract interface ensures that no minting capability exists, eliminating any possibility of increasing the total supply. Similarly, there is no provision for token burning, safeguarding the supply from any reduction.

The distribution of ApeCoin is a meticulously planned endeavor. A substantial portion of tokens allocated to project contributors is initially locked. These locked tokens are gradually released over 48 months, adhering to a predetermined unlock schedule commencing from the launch day, March 17, 2022.

Apecoin allocation
Apecoin allocation

Here’s a breakdown of how ApeCoin is allocated among key stakeholders:

  1. Ecosystem fund (BAYC/MAYC NFT Holders and Treasury/Resources) – 62%
  • 150,000,000 tokens allocated to BAYC/MAYC holders, all accessible at launch.
  • 470,000,000 tokens assigned to DAO treasury/resources. Initially, 117,500,000 tokens are unlocked at launch, followed by 7,343,750 tokens unlocked monthly for 48 months.

ApeCoin distribution to BAYC and MAYC NFT holders is meticulously calculated, ensuring fairness based on the difference in floor prices between the NFT collections roughly a month before the token claim launch (from 02/07/22 to 03/08/22). Eligible holders can claim ApeCoin according to their NFT type:

  • Bored Ape Only: 10,094 tokens
  • Mutant Ape Only: 2,042 tokens
  • Bored Ape + Kennel Club (IDs not needing to match): 10,950 tokens
  • Mutant Ape + Kennel Club (IDs not needing to match): 2,898 tokens
  1. Yuga Labs + Charity (16%)
  • Yuga Labs: 150,000,000 tokens allocated to Yuga Labs. The initial lock-up period is 12 months, followed by 4,166,666.67 tokens unlocked monthly for 36 months.
  • Charitable Donation: 10,000,000 tokens or equivalent value donated to the Jane Goodall Legacy Foundation. The initial lock-up period is 12 months, with 277,777.78 tokens unlocked monthly for 36 months.
  1. Launch Contributors (14%)
  • Companies and Individuals: 140,000,000 tokens allocated to launch contributors. Lock-up schedules vary, ranging from upfront allocations to monthly unlocks over specific periods.
  1. Yuga Labs Founders (8%)
  • 80,000,000 tokens allocated to the founders of Yuga Labs. The initial lock-up period is 12 months, followed by 2,222,222.22 tokens unlocked monthly for 36 months.

ApeCoin DAO Overview

ApeCoin DAO stands as the cornerstone of the APE ecosystem, functioning as the open-source protocol layer energized by a vibrant decentralized Web3 community. A substantial portion of the total APE supply, specifically 47% or 470 million APE, was dedicated to the treasury under the broader allocation of the “Ecosystem Fund.” At the project’s launch, approximately 118 million APE from this total supply were made accessible. This treasury, currently valued at over $2 billion, is a testament to the ecosystem’s robust financial foundation, with a substantial portion accessible in liquid supply, exceeding $600 million.

A crucial facet of the DAO’s role lies in the governance of this treasury. Through a meticulous governance process, ApeCoin holders shape the allocation of funds by participating in community grant awards. These grants serve a profound purpose: to financially support projects that contribute positively to the APE ecosystem in the long run.

Community engagement finds its voice through the submission of APE Improvement Proposals (AIPs). These proposals, falling into categories like Core, Process, or Informational, undergo rigorous evaluation by the APE Foundation before they reach the APE holders for voting. Each vote is a testament to the APE holder’s influence, with the principle of “1 APE = 1 Vote” guiding the decision-making process. The decisions collectively made by the ApeCoin DAO find fruition through the diligent efforts of the APE Foundation, the entity responsible for executing these decisions. Their responsibilities extend to fund disbursement, liaising with external vendors, and ensuring the smooth operation of the DAO.

Leading the APE Foundation is a five-member Board, selected annually. This Board not only takes up administrative roles but also stands as community leaders, ensuring the DAO’s vitality. The initial council members, chosen for their prominence in the Web3 and NFT space, are:

  • Alexis Ohanian: Co-founder of Re ddit; General Partner & Founder of Seven Seven Six;
  • Amy Wu: Head of Ventures & Gaming at FTX;
  • Maaria Bajwa: Principal at Sound Ventures;
  • Yat Siu: Co-founder & Chairman of Animoca Brands;
  • Dean Steinbeck: President & General Counsel at Horizen Labs.

It’s noteworthy that the Board’s tenure, initially slated for six months, was extended by an additional three months through a DAO vote on September 22. This extension aims to facilitate the establishment of a comprehensive policy for Board nominations and elections, emphasizing community input.

While ApeCoin DAO incorporates some aspects reminiscent of a traditional hierarchical structure, the heart of its power resides in the hands of APE holders. Though a select group of leaders, The Board, and community moderators oversee day-to-day operations, significant decisions must endure the rigorous public proposal process and earn approval through a governance vote.

Intriguingly, some proposals, such as AIP-4 and AIP-5, put forth by the APE Foundation, have not garnered approval. Additionally, the council leaders have abstained from voting on governance decisions thus far. Their primary role is to ensure the collective will of the DAO is faithfully executed. Looking ahead, the ApeCoin Foundation envisions an evolution toward a fully decentralized, transparent, and self-regulating community, striving to create an environment where the community autonomously directs its course.

Opinion of NFTmetria

Apecoin represents a unique experiment in the world of cryptocurrencies that goes beyond ordinary “meme coins.” Its value is derived from the “Guiding Values” of the ApeCoin DAO, emphasizing boldness, equality, transparency, collective responsibility, and persistence. These principles place Apecoin among innovative projects in the realm of Web3.

ApeCoin DAO consists of Web3 experts, creatives, and thought leaders supported by a powerful “Ecosystem Fund.” This fund enables crowdfunding of the best community-sourced ideas, making Apecoin an intriguing and promising project.

Certainly, there will be challenges and hurdles along the way, but the example of the Bored Ape Yacht Club demonstrates how one successful idea can change an entire industry. Apecoin is not just a cryptocurrency; it is a community driven by a passion for innovation and a commitment to excellence. Its place in the future of the cryptocurrency world promises to be unique and inspiring.

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