Airdrop Experience
An airdrop is like an IPO of NFTs. Just like people apply for shares in an IPO and get 1,2 lots based on demand and luck, this also works similarly. Different projects figure out creative ways of distributing their first set of NFTs either via raffles, first come serve basis, or just basis one’s activeness on the discord server.
So FanCraze was dropping their first set of NFTs as randomized packs. 3 Packs were being dropped
Basic (1 NFT) = $9 = 3000 on sale
Booster (3 NFTs) = $49 = 1500 on sale
Hotshot pack (10 NFTs) = $249 = 600 on sale
The buyer doesn’t control the NFTs he gets in the pack. Since primary market rates are anyway cheaper than secondary markets, this randomization is not very unfair to the investors + also ensures that whales don’t hijack a project’s distribution initially
Booster packs were dropping @ 5:30 pm IST, Base and Hotshot packs were supposed to drop @ 7:30 pm IST
If you want to buy a pack, arrive on the website at the given times, click on a ‘join the drop’ button
You’re assigned a random number in a queue (If that number is greater than the total packs on sale, you’ve mostly lost it. But hope for payments to fail or other buyers to not turn up)
Once your turn arrives, you get a fixed time window (~15 mins) to complete payment and buy your pack. If you can’t you lose your turn, get another random number in the queue
Once all the sales are done, NFTs inside the packs can be revealed
2,3 days later the secondary market will launch where collectors can showcase and list their NFTs for sale, trade p2p
Insights:
Projects are launching too early
The tech surely looked unprepared for the airdrop, there were many issues in a basic queuing system, APIs weren’t able to handle the traffic (the basic pack airdrop was paused and the hotshot pack airdrop had to be postponed 6 hrs). Design and content are blatantly ripped off from other similar projects. Maybe because crypto till now has been very early adopter driven and the industry as a whole is in rapid iteration mode, quality expectations from even open beta products are fairly low. Or who knows, this could just be proof that there’s truly a web3 talent dearth.
The demand is real, but the audience is very segmented
As the time for the airdrop was approaching, people on discord were exponentially increasing (went up to 2k+ online, my guess is 10k+ were participating in the drop). And folks who’ve taken the pain to join discord are just the high intent users. So surely there’s no shortage of people at least interested in this. I would divide this audience into 3 three sets
The speculators: These folks are mainly in it for the money. These are seasoned traders in early NFT projects. They have playbooks around how to skip queues, what packs to buy to get the best NFT sets etc. These get active on the discord mostly around event times, don’t contribute to the sports community as such but nevertheless provide much-needed liquidity for the market to function.
The crypto native fans: The ideal user, who understands crypto enough for it not to be a transactional blocker, and wants to mainly use the NFT’s utilities as a fan.
Just fans, not crypto native: Has the same wants, doesn’t understand the value add NFTs brings + having trouble with the web3 UX
The issue is currently bulk of the demand comes from the speculators. Hence the demand for the core use case is still not validated. Seasoned speculators are still a net positive, but the pure gamblers who neither understand the tech nor the sport and just come in to try their luck add unnecessary volatility. Fans are interested as well, it's just that the environment right now is not very comfortable for them. They don’t even understand what are the right questions to ask, where to begin. They just want to own their favourite highlight. The gold lies in converting user 3 to 2 and minimising the gamblers from set 1.
The community is truly global
The discord server never stops buzzing, some continent is always awake. For instance, all Indian folks slept after the last airdrop finished at midnight. Once the FanCraze team was done with reconciliation, the owners could open their packs and reveal NFTs. This was 5 AM IST, but still, the discord was buzzing with a bunch of Aussie folks bragging about what they got. I made 3 new friends, all from different countries, all of them knew nothing about cricket but had invested cause it was an ICC licensed product. All of them were asking how good the players they got were :)
Gamification bonds the community
Live auctions are addictive. The delight of ownership is real too. The drop for the costliest Hotshot pack was delayed by 6 hrs. Still, the audience on discord hardly reduced. Even I had discord open on a parallel tab the whole time. Post all the build-up, the drop finished in hardly 10 mins. That’s when I saw a strong stream of emotions. People lucky enough to have got one pack, people having missed out just because of a payment issue. It was all confusion and hostility for a while, people were raising tickets, cursing the platform, calling ‘rug pull’. Once things had calmed down and a few issues had started being resolved, post 5 AM is when the mood flipped. People started revealing their NFTs, appreciating each other's collection, mods earned back trust. Also, the actual UI of how each NFT of a pack was revealed was truly delight worthy, in fact, it reignited the conversation on discord when a few people started sharing screen recordings of their ‘NFT reveal’.
All consumer-facing web3 companies have been trying hard to make this complex technology intuitive to the masses, that’s anyway a long-term goal, but in this process, they’ve pioneered innovations in community engagement and early adopter incentivization.
Community management is going to be a very lucrative job in the future
Given all the drama I mentioned above, this is self-explanatory. Managing an anonymous online audience, keeping them engaged, especially over the long term is no easy task. And I’ve now seen firsthand how important a role it plays in the success of a project. The better community you build the more sticky user base you build, the more new users you get to iterate on (there’s a dearth of web3 aware consumers too :P) Clarity in communication and very high patience seem key skills.
Marketplace thoughts, what will I do with my NFTs?
When the dust had settled, I had gotten a bunch of common NFTs and 1 rare NFT (a four by Babar Azam in the 2019 WC). People were speculating the floor price of each highlight. Turns out this is also a rabbit hole worth digging into. There are elaborate platforms built for analyzing this data (check out evaluate.market, this is also backed by Dapper btw, so yea I’m still paranoid about how decentralized this system actually is)
Anyway, that’s for a separate article. Some thumb rules for valuing a sports collectible I figured are:
How famous the players are, how relevant the match was obviously
Older match dates and older mint dates are usually pricier
If the serial number on your highlight is special, that could be priced higher (First copy, last copy, serial number matching the player’s jersey number)
Patterns can be valued higher (Like a collection with NFTs from each Indian team player) When challenges come along, prices of NFTs used to complete these challenges will increase as well.
There are some other categories and stats metadata attached to the NFT that can later hold value based on utility in the metaverse games
I won’t be tracking the NFTs I got airdropped this deeply though. Personally, I plan to HODL whatever I’ve got.
The longer I stay invested, the more I’ll stay in the loop of developments in this space. I’ve anyway put up a small sum, assuming it’s a tuition fee for learning
One thing I might do once the secondary marketplace opens up is maybe, trade a few common NFTs for a single rare one, those would accrue more value in the longer term.
Irrespective of the player and team, first mints would always be priced well and will only compound with time as long as the FanCraze project and flow ecosystem keeps growing.
And given both capital and domain backing, I’m fairly bullish on FanCraze’s growth. NBA TopShot started in Oct 2020 and in a bit more than a year has scaled to 1M+ signups and 150k+ Weekly Active Users. Cricket has more fans by number, but are these fans crypto native yet? do they come from countries where they could pay for collectibles? These are some questions time will answer. Maybe this might kick off in India only when these NFTs have utilities in cricket-based p2e games, that might attract our masses to web3 OR this could just be a market of a few high ticket size collectors playing status games with each other.
For now, only one thing seems certain tho -> WAGMI :)