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Visa bought a CryptoPunk!

Stunt or not, Visa’s CryptoPunk purchase is a vote of confidence for NFTs.

25 Aug 2021by Geoffrey Lyons

To the NFT world, Visa’s roughly $150,000 purchase of CryptoPunk #7610 on Monday looks a bit like grandma joining Twitter—it’s equal parts bizarre and inevitable. Here’s an institutional giant, over sixty years old, taking yet another awkward step into the burgeoning crypto space in what’s either a ploy to appear hip and in touch or a genuine effort to adapt.

Those who think it’s the former see Visa’s purchase as yet another addition to a long list of NFT marketing stunts. Those in the latter camp (typically diehard NFT enthusiasts), see the move as a concession to the inevitable takeover of all things crypto. Between these two poles are ordinary investors who simply feel vindicated for their own NFT purchases—if Visa bought one, then it’s not a crazy fad after all.

There are 10,000 CryptoPunks, 3,840 of which are female, 696 of which have “hot lipstick”, 441 of which have mohawks, and 396 of which have “clown green eyes.” Only one has all four features—#7610—and Visa bought it. Why this CryptoPunk and not one of the other 9,999 is a mystery. But why a CryptoPunk at all isn’t: Visa tweeted about the purchase, pinned the tweet, and published an in-house interview explaining the move at length. Clearly they want people to know they mean business.

“We think NFTs will play an important role in the future of retail, social media, entertainment, and commerce,” said Cuy Sheffield, Visa’s “resident crypto and NFT expert”. “With our CryptoPunk purchase, we’re jumping in feet first. This is just the beginning of our work in this space.”

Assume for the sake of argument that Sheffield’s comments are a cover for what was indeed just a marketing stunt, and that any other “work in this space” will also be a stunt. In other words, assume that Visa doesn’t really take NFTs seriously.

In the short-term, the market doesn’t seem to care. According to Nasdaq, CryptoPunks sales exceeded $86 million on Monday alone—a new daily record. This “buying frenzy” contributed to a new monthly record as well, boosting August’s sales to nearly double the previous record of $135.2 million. If Visa’s purchase is all hot air, its immediate consequences certainly aren’t.

But what about the long-term? Actions speak louder than words. Say what you will about TikTok, when your marketing department is using it that counts as a vote of confidence. Have your private doubts about cryptocurrencies, but the moment you make a multi-million dollar investment you signal to the world they have something going for them.

It’s no different with a pixelated avatar: if you buy it, you back it. In other words, it doesn’t matter what Visa’s motives are—Monday’s purchase is a win for NFTs.