Bored Ape NFTs Sale Scores Former Junk Bond Traders 700% Profit
Former Barclays Plc bond traders Ovie Faruq and Mike Anderson have sold a collection of iconic digital art that triggered their departure from banking and their pursuit of careers in nonfungible tokens.
Faruq and Anderson sold 72 Bored Ape Yacht Club NFTs for between 78.08 and 78.18 Ether each this week, which translates to roughly $9.25 million, according to transactions recorded on NFT marketplace OpenSea. Faruq said the initial investment was around $1.14 million, which would make for at least 700% profit.
NFTs, digital art that typically uses the Ethereum blockchain and is bought and sold with cryptocurrency Ether, saw their value soar in early 2022 during the height of crypto mania before a sharp selloff. However, this year's rally in risky assets has seen Bitcoin rise more than 40%. That created a window of opportunity for the traders, but one that may not last, especially as the Federal Reserve continues to hike interest rates.
“We were both high-yield bond traders for 10 years and we have learnt that you have to respect the liquidity when it's there and take the profit when it's available,” Faruq told Bloomberg. “Even though it feels liquid, it's still an illiquid asset.”
The so-called floor price of Bored Ape Yacht Club NFTs, a set of images that show apes in various states of boredom, has fallen about 2% since the sale to 77.4 Ether on Wednesday, according to the OpenSea marketplace. The collection could have commanded over $30 million at a peak on May 1, 2022, according to data compiled by Bloomberg and CoinGecko.
Faruq said he and Anderson remain seed investors in Yuga Labs Inc., the creator of the Bored Ape Yacht Club NFTs, and own other Yuga Labs assets such as the ApeCoin cryptocurrency tokens.
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