ApeCoin (APE) is a relatively new cryptocurrency issued by the Bored Ape Yacht Club (BAYC) and is as of writing, making huge waves in the crypto market.
The BAYC is an evolving virtual community that has attracted many people including celebrities and holds an interest in arts, entertainment, gaming, and culture.
With the way the coin has performed recently in the market and also taking into account the nature of its ecosystem, it is expected that there will be a marginal increase in its price in the coming months.
There is also a possibility that there might be a significant dip in the coin’s price in the weeks ahead before it will pick up again and then stabilize.
It is an intriguing coin that is currently generating a lot of buzz and this article will be examining what the coin is about and if it is worth investing in.
Below are some quick facts about ApeCoin:
- The highest price for ApeCoin was seen on April 28, 2022, when the price hit $26.70
- The lowest price for ApeCoin was seen on March 17, 2022, when it was at an all-time low of $6.21
- The 24-hour trading volume of ApeCoin stands at over $5.7 billion (01.05.2022)
How to Buy ApeCoin
You can either buy real ApeCoin (owning the underlying crypto) or buy CFDs if you only want to speculate on the price movements in ApeCoin (without owning the underlying crypto).
CFDs are often more suitable for active traders as the spreads are usually much lower. For long-term investors, buying real ApeCoin is usually the way to go.
Buy ApeCoin (real) through eToro
eToro is the world’s biggest social trading network with more than 25+ million users. You can invest in over 100 cryptocurrencies in addition to real stocks with a 0.00% commission.
eToro charges a 1% commission when buying cryptos such as APE.
Step 1: Sign up at eToro here
Step 2: Verify your account
You can deposit and invest up to $2000 before your account is fully verified. In order to verify, you must submit some personal details and upload the required documents.
Step 3: Search for ApeCoin in the platform
Step 4: Choose the amount you want to buy for
The minimum amount you can buy ApeCoin for is only $10. The minimum deposit at eToro is $50 for most countries.
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Buy ApeCoin CFDs through Capital.com
If you want to speculate on the ApeCoin price (both long and short), without physically owning the crypto, CFDs are often preferred.
Capital.com is an award-winning trading platform regulated in several jurisdictions including the United Kingdom, the EU, and Australia.
You can buy and sell over 400 cryptos with X2 leverage. Note that crypto CFDs are not available for UK clients.
Step 1: Sign up at Capital.com
Only email and password are required for a demo account.
Step 2: Verify your account and deposit
You can deposit up to $2000 before your account is fully verified.
Step 3: Select ApeCoin in the platform and trade
The margin requirement for APE is 50% (X2 leverage) which means you can buy ApeCoin for up to $2000 if you have $1000 in your trading account. Since you are trading CFDs, you can also go short cryptos and profit from falling prices.
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What is ApeCoin?
ApeCoin is a cryptocurrency that was recently launched on the Ethereum (ETH) network and that makes it an Ethereum-based ERC-20 token.
It is the integral cryptocurrency for the APE ecosystem which comprises the ApeCoin DAO, products, and services that use APE.
Yuga Labs which created the popular Bored Ape Yacht Club (BAYC) NFT collections has adopted APE as the prime token for all new products and services.
The BAYC was launched in April 2021 and it consists of thousands of individual ape NFTs with each one having unique facial expressions and clothing.
It grew in popularity when celebrities invested a huge amount of money in the ape NFTs.
ApeCoin is designed to function as the decentralized protocol layer for several community-led initiatives and the APE Foundation is currently in charge of managing the token.
The APE Foundation essentially manages the decisions of the ApeCoin DAO (decentralized autonomous organization).
Therefore, the only individuals that can vote in the DAO are the holders of ApeCoin, a DAO that is facilitated by the Foundation.
Objectives of ApeCoin
The ApeCoin token intends to facilitate the establishment and evolution of a decentralized web 3.0 community through the following objectives:
- Access: for holders of ApeCoin to have exclusive access to games and services along with certain events and items.
- Governance: ApeCoin holders are granted opportunities to be members of the ApeCoin DAO which will enable them to vote on partnerships, projects, the rules of governance, and so much more.
- Incentivization: third-party developers can also be a part of the APE ecosystem by integrating APE into games, services, and other projects.
- Spending: due to the nature of ApeCoin as a utility token, it is possible to use it in the absence of centralized intermediaries.
Distribution of ApeCoin
The total supply of ApeCoin in circulation is fixed as it is limited to 1 billion tokens which were all minted at once and it is structured for distribution among four major groups.
The first major group is the Ecosystem fund which has 62% of the total tokens allocated to it with 150 million tokens airdropped and another 470 million in DAO treasury.
The second group is Yuga Labs and Charity with 16% allocated. 150 million tokens go to Yuga Labs while 10 million is for donation to charity. The third group features those that contributed successfully to the launch and 14% is allocated to this group.
There are 140 million tokens available with a designated period for lock-up along with window periods for unlocking; 10 million tokens upfront. The fourth group consists of BAYC founders with an allotment of 8% which translates into 80 million tokens.
The 150 million ApeCoin tokens from the Ecosystem fund were distributed to BAYC NFT holders in the format shown below:
- Bored Ape + Kennel Club: 10,950 tokens
- Mutant Ape: 2,042 tokens
- Bored Ape NFT: 10,094 tokens
- Mutant Ape + Kennel Club: 2,898 tokens
The coin is currently being traded on various crypto exchanges such as Huobi, Coinbase, Kraken, KuCoin, and Binance. The market capitalization is almost three billion dollars and it is still growing.
Why Buy ApeCoin?
Ever since its inception, ApeCoin has experienced an astronomical growth and while there was a downturn at some point, it has picked up again. The token is currently seen as the most popular crypto asset on the market.
It would be worth considering investing in ApeCoin due to its positive future outlook. It is essentially a high-risk investment that is capable of delivering massive returns.
In the short term, the token may experience very high volatility because of speculation that the virtual land sale of Yuga Labs project known as “Otherside” will be priced in APE.
This means it might be more advisable for an investor to wait for ApeCoin to stabilize before buying tokens especially if the volatility continues.
However, with the popularity of BAYC and the astronomical demand from investors like celebrities and athletes, then there is a likelihood that the demand for APE will continue to rise among investors if the BAYC ecosystem keeps on developing successfully.
There is a growing belief that Yuga Labs and the BAYC ecosystem will continue to thrive and compete well in the market and investing in ApeCoin can be a profitable way of snapping up the increasing value of the ecosystem.
The Technology behind ApeCoin
The technology used in ApeCoin is known as the Proof-of-Work consensus mechanism which functions to validate the transactions conducted on the ApeCoin blockchain.
Proof-of-Work is a type of decentralized consensus mechanism in which members of a network are obligated to try and provide solutions to an arbitrary mathematical puzzle so that people are stopped from gaming the system.
The Proof-of-Work (PoW) used by APE is known as ‘Lyra2REv3’. This PoW is effective because it is designed to resist the mining process that utilizes Application Specific Integrated Circuit (ASIC).
This means that it is possible to mine APE by using Graphics Processing Units (GPUs) as these are more widely available and cheaper than ASIC miners.
APE also has an NFT marketplace known as MonkeyFirm integrated into its protocol. The NFT marketplace will enable users to engage in the buying, selling, and general trading of NFTs. Holders of the APE token will thus have a means of buying unique digital items.
APE also utilizes the protocol known as Segregated Witness (SegWit) which supports transactions of smaller sizes and enhanced scalability.
It does this by eliminating signature information (also known as the “witness” information) for storage outside the base transaction block. This allows for modification of scripts and signatures without interfering with the transaction ID.
Part of the technology behind ApeCoin is the Lightning Network which makes payments fast and cheap while the block time on APE is 2.5 times faster than that of BTC with a block time of 10 minutes.
Therefore, transactions on the APE blockchain are confirmed quicker than transactions on the Bitcoin blockchain.
What Affects the Price of ApeCoin?
ApeCoin is currently in an upward trend in the market in terms of its price and it is driven by several factors.
However, there are three major factors responsible for the upward momentum being experienced by the coin and they are:
The popularity of Bored Ape Yacht Club (BAYC)
Those that are into the investment of NFTs will be familiar with BAYC as it is the collection that made ape-based art quite popular and it has become so integrated into the media that multiple celebrities such as Eminem, Jimmy Fallon, and Justin Bieber have bought Bored Apes NFTs.
The level of mass appeal that the Bored Apes NFTs have is bound to impact ApeCoin positively even though the two projects are not developed by the same company.
Listing on major exchanges
This is another factor that has driven the value of ApeCoin higher because being listed on multiple major crypto exchanges shows a level of reliability considering how difficult it is to be listed on a major exchange.
Generally, these centralized exchanges tend to have strict requirements to get listed which makes it difficult for new projects to meet these requirements.
This is why it is impressive that despite being a new coin, it has already made its way to the list of cryptocurrencies that can be traded on major exchanges.
Some of these exchanges where ApeCoin is available for trading have been mentioned in the earlier part of the article.
General market sentiment
Generally, with smaller coins such as ApeCoin, they tend to go along with the overall market trend until they are stable.
Presently, investors have a positive sentiment towards the crypto market which is helping to drive the value of cryptocurrencies higher.
ApeCoin also stands to benefit from this positive sentiment as the crypto market experiences more liquidity which is bound to positively affect the price of ApeCoin whether directly or indirectly.
Risks Involved in Buying ApeCoin
There is no form of investment that does not come with risk and it is the same with investing in ApeCoin.
The first kind of risk to watch out for is purchasing too high, especially when it is a new cryptocurrency like ApeCoin.
Sometimes, when a new cryptocurrency is launched, it is accompanied by a lot of excitement from investors in the early days of trading.
As such, investors might make purchases in the hope that there is a price hike after which they cash out their profits before the coin hits a potential crash.
There is only so much value that project developers and administrators can build into a token which is why investors need to be careful when buying ApeCoin if they do not want to lose a large portion of their money.
Another risk to take into consideration is the extreme volatilities that cryptocurrencies experience regularly which means they can rise or decline quickly with little or no notice.
For instance, a lot of coins experienced a decline this year due to fears of inflation and the invasion of Ukraine by Russia.
Finally, due to the short lifespan of ApeCoin so far, it means it is yet to have a proven trading record like the well-established cryptocurrencies such as Bitcoin and Ethereum which means an unfavorable event could cause the coin to crash and be wiped out completely.
This is why investors need to be vigilant, monitor their investments, and not be greedy.
Best Hardware Wallet for ApeCoin
Since ApeCoin is an ERC-20 token, it is automatically supported by the Trezor hardware wallet (it supports all ERC-20 tokens).
Hardware wallets are a means of storing crypto funds offline and that keeps them out of the reach of online hackers.
While software wallets such as Coinbase Wallet and Metamask are excellent for frequent use, hardware wallets are more suitable for storing funds that are not likely to be sold in the short term.
And in this case, the Trezor hardware wallet comes highly recommended.
Despite its short period of existence, ApeCoin has caught the attention of investors and it keeps growing in popularity.
It has come off as a user-friendly and scalable cryptocurrency which makes it quite attractive to investors.
With a solid team that has sufficient experience backed up by a commitment to making the coin a success along with sophisticated technology, ApeCoin looks like an excellent investment.
The coin even has some intrinsic benefits that put it in a favorable position against Bitcoin but being a new coin, investors still need to be wary because these new coins can sometimes fade away and become irrelevant very quickly.
This is why it is advisable to not place too many expectations on it just yet at least until it has undergone some turbulent periods and survived.
However, that does not mean people cannot make a sizeable, affordable investment while tracking the coin’s progress in the market over the next couple of weeks and months.
Bottom line is that this article should merely be used as an informational resource rather than a guide for financial advice.
Every investor has a duty to him/herself to carry out proper research about any investment opportunity while also ensuring to invest only an amount of money they are comfortable with losing since the outcome of an investment cannot always be predicted.
However, due to the buzz from celebrities and the evolving ecosystem, ApeCoin looks like an investment that is worth checking out.