What we learned: Party of the Living Dead

Updated: Sep 27, 2021

I spent last week researching fractionalized NFTs and have always found the best way to learn a new technology is by actually using it. Having just written about Fractional.art, I was itching at the opportunity to collect my first fractions of a rare NFT. I saw this tweet by Andy8052 pop up on my feed and it piqued my interest.

CryptoPunks were making headlines last week for their skyrocketing prices. Zombie Punks (like the one above) are some of the rarest CryptoPunks available and are selling for upwards of $1,000,000. I've never had the money to afford a Punk so I decided this was the perfect moment to get in on the action. I clicked on the link in the quoted tweet and it took me to a website called PartyBid.


PartyBid enables group bidding on NFTs. If the group pools together enough ETH, it triggers an auction for the NFT. The highest bidder at the end of the auction is the new owner of the NFT. In this case, "Party of the Living Dead" was the group I was bidding with on this CryptoPunk. In total, 478 people joined together to purchase Punk #2066 for a grand total of 1201.725 ETH.


Beyond the surface of Fractionalized NFTs

In my Fractional.art explanation, I wrote that I was worried about the possible dilution of value NFTs could see from being fractionalized. My reasoning behind this was because I thought there would be a lack of personal connection to the fractionalized tokens. After using PartyBid and winning this auction I can honestly say my perspective has completely changed.


One of the biggest surprises to me after the auction was that a community instantly emerged around Zombie 2066. I was scrolling through Twitter after the sale concluded and noticed a couple Discord groups appear immediately. Fraction-owning communities can best be described as "temporary DAOs" that are spun up when an NFT is purchased and only exist until the NFT sells. The Grateful DAO now acts as a group that holds the Zombie Punk until they eventually sell it and split the profits.


DAO-based communities are a huge benefit of participating in group bidding. This creates the opportunity for so much more to happen after the auction ends. Imagine a team of people working together to create content around and NFT and market it so that they can sell it at a higher price later on. This gives anyone the opportunity to meet and collaborate with other like-minded people that share a common goal. Not only does value come from the NFT itself, it also comes from the community that owns it. The ceiling for its next sale does not exist when there is a group of people incentivized to work together.


In my opinion, this is extremely bullish for NFTs since there are now two layers of communities that can add value to the tokens.

  1. A collection's community (ex: CryptoPunk owners)

  2. A specific NFT's community (ex: Zombie 2066/The Grateful DAO)

Fractionalized NFTs create more diversity within their collection because of the lower barrier to entry. Allowing people with less money to gain exposure to the specular upside of NFTs will play a key role in onboarding new entrants to already established NFT communities like CryptoPunks.


I also think fractional tokens will foster more inclusivity for minority demographics in the NFT space. NFT avatars depicted as women or people of color often comprise the floor price of their collection. The majority demographic of crypto is white men and they don't relate to these Punks/Meebits/etc which leads to them being left on the market longer. To combat this, a group of PartyBid users had the idea to place group bids on these floors and encourage other PoC to join in and give NFTs a try for the first time.


I'm excited for the future of fractionalized NFTs and really wanted to make this post because it opened my eyes to a few things I was unable to consider before trying it out myself. Fractional.art started the wave, PartyBid.app followed, and I'm sure we'll see many more innovative apps start popping up around fractional tokens. This is one of the more difficult concepts in NFTs/DeFi but like I said at the beginning of the post, the best way to learn is to try it out for yourself.

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