10 Moments That Defined Web3 in 2023
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For all of us in Web3, this year has been a roller coaster, a haze, a span of time with depths of existential dread and peaks of sublime beauty. We started in a dismal bear and are ending as liquidity, hope, and frenzy return to the space.
Summing up a whole year is a challenge, and as we thought back on 2023, we realized that there are many more moments worthy of inclusion than we have space to explore! That said, here are ten of the most notable moments in 2023 that we will remember for years to come. Instead of ranking them, we’ve listed them in chronological order.
Open Editions
Open editions—NFT drops with no set supply limit, allowing collectors to mint as many tokens as they want within a fixed period of time—appeared everywhere in 2023. The trend had picked up in late 2022 with Alpha Centauri Kid’s dramatic show stopper “Color Study” and continued with Ness Graphics’ “Money Printer Go Brr,” which sold over 20,000 copies, netting $2,322,869. Mad Dog Jones’ Forever Mart, open for an hour, garnered over $738,000 on Jan. 30, and Lucréce’s Proceed with Caution sold over 8,000 pieces in 15 minutes, netting over $818,000.
Perhaps the most influential of the early 2023 OEs has been Jack Butcher’s “Checks.” From the wellspring of that 24-hour mint, priced at $8 in an echo of the cost of Twitter Blue, the 16,000-plus edition’s rainbow grids of checks became a game: burn editions to create rare patterns, whittling down the number of check motifs, all the way to the legendary single black check.
The Checks collections have traded over $128 million in volume, with individual sales over 31 ETH—but in terms of memetic awareness, they have been eclipsed by Opepen, a free, one-hour open edition released on Jan. 8.
Inspired by the graphic style of batz, the Opepen editions are, at base, a series of rectangles and circles evoking Pepe the Frog-but as the 16,000 minted Opepens slowly reveal, in opt-in sets of 200, their true power unfolds. Opepen’s arrangement of shapes is now instantly recognizable, and Butcher’s partnerships with brands like Squiggles and Pudgy Penguins have cemented Opepen as a defining motif of the nft space. He’s even collaborated with individuals like ThreadGuy—dropping a $2 open edition to honor ThreadGuy adopting an Opepen as his PFP on X.
Bitcoin Ordinals
With the January launch of the Ordinals protocol, Bitcoin became more than a store of value—it became host to its own digital collectibles, called inscriptions. Bitcoiner Casey Rodarmor began working on the project in 2022 after the 2021 Taproot upgrade to Bitcoin made programmable smart contracts possible on this OG blockchain.
On Feb. 1, Udi Wertheimer inscribed a 4MB image to the Bitcoin blockchain: a drawing of a wizard that had become famous on a Bitcoin subreddit ten years ago. This transaction completely filled a block and made history as the largest Bitcoin transaction in history. This inscription–called an Ordinal–is the first Taproot Wizard–and its creation launched one of the most well-known and desirable collections on Bitcoin.
While some people think that Ordinal inscriptions are spam, these images—encoded entirely on-chain, unlike many NFTs—began trading without any marketplace protocols. At first, you needed to run an entire Bitcoin node to create or trade them, then when that was solved, you still had to do technical trickery with wallets like Sparrow, trading inscriptions via Google Sheets order books, escrows, and trust. Now, many marketplaces support Ordinals, including Magic Eden and OKX, and you can use several wallets to trade Ordinals as safely as you would trade Ethereum NFTs.
Other notable collections on Bitcoin Ordinals include the very early Ordinal Punks collection, OnChainMonkey, which is one of the earliest 10k PFP collections on Bitcoin, Bitcoin Frogs, and Bitcoin Rocks. There’s also BRC-20—a protocol launched in March and inspired by Ethereum’s ERC-20s, that enables the creation of new, tradeable tokens on Bitcoin, meaning degen meme token trading is roaring along. As of this writing, BRC-20 tokens have a market cap of nearly $2 billion and traded a volume of nearly $900 million on Dec. 27.
Marketplace Wars: OpenSea Versus Blur
OpenSea started 2023 with around 45% of the total NFT market share but faced a steady decline over the year. By December, its share plummeted to less than 25%, overtaken by Blur, which had nearly 75% of the sales. According to data from DappRadar, Blur’s NFT sales volume in the last month has totaled $590 million, ranking above all other NFT marketplaces. Blur experienced meteoric growth over the year, fuelled by its Season One and Season Two airdrop farming campaigns, which incentivized users for listings, bids, and sales.
Facing stiff competition, OpenSea eliminated its marketplace fee temporarily and made creator royalties optional. This sparked fury within the NFT community, with major communities like the Bored Ape Yacht Club announcing their intention to create their own marketplaces where royalties are enforced.
In May, Blur introduced Blend, a peer-to-peer NFT lending protocol, enabling traders to maximize NFT liquidity by allowing buyers to put up collateral for their token purchases. They followed on with Blast at the end of their second airdrop season in November. Promising an L2 blockchain with native yields for ETH and stablecoins, Blast has attracted over $1.1 billion in deposits from users who are eager to farm its native token. With some power users like machibigbrother trading millions in NFTs on Blur in order to reap a $BLUR reward, the farming meta—and its effects on NFT markets—shows no signs of fading.
The Goose
In 2023, Dmitri Cherniak’s “The Goose” from his Ringers series on Art Blocks sold for an impressive $6.2 million at Sotheby’s Grails Part II auction, significantly exceeding its initial purchase price of approximately $5.8 million by 3AC co-founders.
This auction, held in Sotheby’s New York showroom, was part of a liquidation of Three Arrows Capital’s collection following their collapse. It featured a variety of generative art NFTs, including an Autoglyph and a Chromie Squiggle, and garnered substantial attention, with the sale of “The Goose” as its highlight. The event surpassed expectations, concluding with an $11 million total from the live auction and culminating in $17 million for the entire Grails collection.
Sotheby’s success in this auction was attributed to its strategic presentation of NFTs within the context of fine art, blending traditional and digital art worlds. The vibrant live auction atmosphere, with over 150 attendees and passionate bidding, underscored the growing appreciation and recognition of generative art in the broader art history of the 20th and 21st centuries.
Sam Spratt’s The Monument Game
The Monument Game, by digital artist Sam Spratt, was a breathtaking, interactive artwork that captivated the space in the midst of the bear market. It kicked off on Aug. 21 on Nifty Gateway, with the sale of more than 256 “Player” tickets that enabled holders to compete for three of Spratt’s highly sought-after Skulls of Luci, by co-creating stories within Spratt’s new 1/1 artwork, “IX. The Monument Game,” over the course of four days.
Spratt consulted with developers, including Duncan Cockfoster of Nifty Gateway, to create a platform where users can zoom into and pan around the vast 20,000-pixel painting, which depicts a group of hominids lighting fires, fighting, loving, and caring for each other in the ruins of an advanced civilization. This allowed players to delve deep into the hundreds of stories woven throughout. The players’ written observations, annotated on the sprawling, rich canvas on Nifty Gateway’s front page, were often lovely and always deeply personal; Spratt asked players to give something of themselves.
Ultimately, the Council of Luci—Skulls holders worldwide—chose three winners, who received Skulls as their prizes and took their seats on the Council. The Monument Game painting itself was sold to 1 of 1 founder kukulabanze for 420.69 ETH. The cultural significance of the piece—and the game—is lasting. It shows what digital art and blockchain can do: an artist can bring entire communities together to create a masterpiece that could not exist in analog form.
Pudgy Penguins Take The World By Storm
Led by Luca Schnetzler, Pudgy Penguins announced they would offer plush toy versions of their adorable, round penguin NFTs in 2,000 Walmart stores this September. Following nearly $500,000 in the first 48 hours of sales after the toys hit Amazon in May of this year, this strategic move mirrored iconic franchises like Pokémon and Hello Kitty, aiming to integrate the physical and digital worlds.
With each toy sold linking directly to the existing NFT intellectual property, Schnetzler projected in September that toy sales would net $1.5-2 million in profits for the brand. The toys, which are also available on Amazon and at Smythe’s stores, provided real IP value to NFT owners and connected ordinary people with the broader web3 ecosystem. The market response was striking, with a 315% increase in Pudgy Penguins NFT trading volume in the week after the toys hit the shops.
In December, the team launched Pudgy World, a Web3 game on the zkSync Era blockchain, offering an immersive digital environment with unique perks for both NFT holders and toy purchasers. This development nearly doubled the price of its NFTs, which currently sit at an 11.25 ETH floor.
The SocialFi Boom
In the middle of the summer debut of Coinbase’s new Base chain, its most popular app—friend.tech—rocked web3, racking up over 100,000 transactions a day at its peak. The app is known for allowing users to buy “shares”—later, changed to room “keys”—of the people on its platform. Holding keys granted exclusive access to high-level crypto influencers, many of whom created content and opportunities just for their holders.
The app incentivized participants with points for trading and holding keys, and in the fall it introduced a public feed where people could earn points by creating popular content.
A bevy of apps copied friend.tech, including New Bitcoin City, Post.Tech, and Stars Arena. Interesting variations, like the virtual pet game at FrenPet, have cropped up, and the broader concept of SocialFi—monetizing the consumption of and engagement with content—broke out into the mainstream, with tokens like Portalcoin and Memecoin rewarding users for engaging with and promoting their content on X.
Although Crypto Twitter (now X) remains the home of most crypto and NFT discussion, the challenges posed by changes to X’s reach algorithms and advertising systems since Elon Musk took over mean there are huge opportunities for companies experimenting with incentivizing engagement—on or off of X.
With TVL across SocialFi platforms at over $36 million as of Dec. 26, and with SocialFi-driven gaming token Portalcoin having raised nearly $10 million in the first 15 minutes of its December presale, web3 is likely to see more innovators—and imitators—in the social space in 2024. As the OG SocialFi app, friend.tech posted on Dec. 19 that their beta will soon be over, hinting at rewards for loyal participants in the spring.
The Conclusion Of The SBF Drama
In 2023, the saga of FTX and its founder, Sam Bankman-Fried (SBF), culminated in shocking developments reverberating throughout the space. FTX, once a towering figure in the crypto exchange landscape valued at $32 billion, declared bankruptcy in November 2022. This collapse triggered an avalanche of scrutiny and legal actions against SBF and his associates.
Sam Bankman-Fried, originally hailed as a savior of the crypto world, faced a massive downfall as details of his fraudulent activities came to light in November 2022. After the May 2022 collapse of Terra/Luna, lenders like BlockFi, Celsius, and Voyager fell. FTX looked like a strong survivor, but investigations uncovered a deeply flawed balance sheet at FTX and its trading arm, Alameda Research—leading to his arrest and subsequent extradition from the Bahamas in December 2022.
FTX and Alameda leaders Nishad Singh, Gary Wang, and Caroline Ellison pled guilty to various charges, while SBF himself faced a maximum prison sentence of 115 years.
The fallout from the FTX collapse continued into 2023. The U.S. Justice Department set up a website for FTX customers to report fraud, and the New York State Department of Financial Services issued guidance to prevent similar incidents. The UK’s Charity Commission even investigated a charity that benefitted from FTX donations. Alameda Research was implicated in the crisis—with investigators saying they used FTX customer funds for their trading.
Throughout 2023, SBF pushed his luck, breaking the letter and spirit of his house arrest agreement by using VPNs and attempting to contact potential witnesses in the case. The exasperated judge threw him in a New York City jail, and he made a shambles of his defense when he eventually went to trial—and was found guilty of fraud and conspiracy—in November of this year. His sentencing will take place in March 2024.
NFTs On The Simpsons—Again
A Nov. 6 segment in the 2023 Halloween episode of The Simpsons, titled “Wild Barts Can’t Be Token,” was a joyful send-up of our space, featuring the art of Bored Apes, Doodles, Squiggles, Nyan Cat, Punks, and other iconic NFTs. When Homer scanned Bart onto the blockchain, Marge had to enter the Snowpiercer-esque “block train” to bring him back.
The episode led to an NFT mini-pump, with more Punks trading hands in a single day than any day since March 2023, NFT floor prices rising, and even an homage Springfield Punks collection.
Adding to the market buzz, BAYC and Yuga Labs co-founder Wylie Aronow, known as Gordon Goner, embarked on a notable NFT buying spree on Nov. 7. His acquisitions included an epic zombie Punk and a range of prominent PFP NFTs across the metaverse, such as Cryptoadz, Deadfellaz, Forgotten Runes, Cool Cats, Doodles, Meebits, Azuki, CloneX, World of Women, and Mocaverse, among others.
This spree, which took place in the midst of a crypto winter, was a significant event for the NFT community and contributed to market movements. The space interpreted Aronow’s actions as a strong vote of confidence, adding to the market’s excitement following the Simpsons episode.
Solana’s Time To Shine
Late December 2023 has been a big Christmas present for Solana fans. Created in 2020, Solana has demonstrated a remarkable resurgence since it was trading for $10 last December after major proponent SBF was extradited to the U.S. in 2022. On Dec. 26, it reached a high of $124 and traded at $107 on the 29th.
As of Dec. 28, Solana is the fifth biggest crypto in terms of market cap. Solana NFT collection prices have skyrocketed—Mad Lads have gone from a 50 SOL floor price in October to Dec floor prices as high as 218 SOL, while the floor price of Tensorians has doubled in the past month.
The memecoin ecosystem on Solana has also blown up. Most famous is $BONK, which sparked a run on Solana Mobile’s Saga phone when the price of the token, included with the handset, was worth more than the price of the phone. There’s also dogwifhat, Myro, Analos…, and the list goes on and on.
While there was an Ethereum meme token heyday earlier this year, with $PEPE taking the lead, punishingly high Ethereum L1 gas and slow transaction times have made Solana the blockchain of choice for folks who make a lot of trades, such as degens flipping meme tokens or aping into the latest NFT collectibles. Solana’s DEX volume is regularly topping Ethereum’s, meaning Solana might be the retail customer’s chain of choice in 2024.