Why it matters: American financial services company Visa has joined the non-fungible token (NFT) rat race with its $150,000 purchase of CryptoPunk 7610. The digital artwork will sit alongside Visa's other collectibles as a nod to the past, present and future of commerce. In the short term, however, it could signal the continued staying power of NFTs as a whole.
CryptoPunks, for the uninitiated, are among the earliest examples of NFTs. The pixel art images, of which only 10,000 exist, were created by American studio Larva Labs in 2017 using computer code to ensure that no two images are exactly alike.
As NFTs skyrocketed in popularity this year, so too did the value of CryptoPunks. As of this writing, all but three of the top 20 CryptoPunk sales have garnered north of $1 million. The number one piece of digital pop art, CryptoPunk 7804, most recently sold for $7.57 million.
At nearly $150,000, Visa's purchase of CryptoPunk 7610 doesn't even crack the top 60, but it's relevant nevertheless. Cuy Sheffield, Visa's head of crypto, said they felt that CryptoPunks would be a great addition to their collection of artifacts that can celebrate and chart the past, present and future of commerce.
CryptoPunks "pioneered the NFT technology and wave of NFT commerce," Sheffield said. Their purchasing decision was less about the individual CryptoPunk and more about simply owning a piece of the historical project.
Sheffield added that Visa owns several other pieces of vintage memorabilia related to commerce, including paper credit cards and manual "knuckle buster" machines used to record transactions before electronic point-of-sale systems simplified the process.
Sheffield told The Block that Visa partnered with Anchorage Digital on the purchase, and paid for it using fiat.
It's still early days for NFTs, and it remains to be seen whether or not they're simply a fad that will fade or perhaps the next step in digital commerce. Visa, no doubt, is leaning toward the latter.
"We can envision a future where a crypto address becomes as important as your mailing address," Sheffield said.