NFT Tax Szn

What's Dropping, MathCastles, & More

February 25, 2022

Welcome to The Drop NFT Newsletter. Subscribe and join the discord for breaking NFT news, project breakdowns, & artist spotlights. Thank you for following along on this journey!

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What's Dropping ⚡

  • Cool Cats is still dealing with technical issues surrounding their Cooltopia launch. Anyone that’s ever dealt with software knows what a nightmare building something really is and they’re literally breaking new ground with this P2E concept. Technical issues are a solvable problem and the Cool Cats team has the funds to do this (they just successfully sold out Cool Pets a few weeks ago + any % of secondary they’re continuing to amass) along with giving the dev team the time and space to achieve these fixes. The real issue here is the time (how long will it take / aka wen $MILK?) and communication (which has gotten a bit better this week) with the community.

  • Pixel Vault is airdropping a “Heroes Follow Heroes” token to participants from September. 2021’s PFP switch contest. Tokens, designed by PV’s main artist, Chris Wahl, will hit wallets on the 23rd of February.

  • BrokenSeaDAO announced their upcoming BrokenClub drop on 2/28, this also coincided with details on both their Metaverse club in Sandbox that is currently being constructed along with the launch of their clothing line. With an aim at being one of the biggest NFT clothing brands in the space, the project founders have the manufacturing connections to achieve this goal and with the addition of Murda Murphy as COO and Partner (6ix9ine, Jay-Z, Post Malone + others) you can imagine where the BrokenClub Clothing Brand could end up.

  • Tubby cats minted on Monday, Feb. 21st and completely sold out their collection of 20,000 tubby cats. Floor is sitting around 0.6eth. Trading volume surged, giving them the #1 spot on OpenSea’s top collections, ahead of Invisible Friends, mfers, Bored Apes, Azuki and others.

  • Neon, a Solana-based NFT marketplace, opened the first NFT vending machine just off Wall Street. Selections are made and purchased with a credit or debit card, and the vending machine dispenses a box with a unique code which can be redeemed on the Neon platform.

  • Leon Bridges and Wrangler released an epic, fashion-centric NFT collection. 75 limited edition collectibles are being auctioned through March 1st at 12pm EST. Owners will receive an animated NFT, private event access, a Decentraland Metaverse Wearable and more.

  • Invisible Friends sold out and we asked for your guess at the floor price 24 hours post-mint. Sitting at 8.9ETH, @krisk238 hit the nail on the head & @MisterPente came in close second!

NFT Tax Szn đź’€

Contrary to the metaverse, in the real world, tax season is underway. Every year, we sit down and file our taxes, either individually or through an accountant. We are either issued a refund of overpaid taxes, or we must write a check to the government to pay off the tax that we owe for that given year. One state wants to give you another method to pay.

In an interview with CNBC, Colorado Governor Jared Polis stated that he expects his state to be able to accept cryptocurrency payments for tax-related purposes by summertime. Think about that. No checks. No money orders. Just putting an address in a wallet and clicking send. Polis also stated that Colorado has plans to accept cryptocurrencies as forms of payment for other state-related fees, such as a new or renewed driver’s license.

On one side of the coin, Colorado can be seen as a progressive state that understands the benefits of giving its constituents an option to pay in, let’s say, Bitcoin. But the other side of the coin makes me think about government oversight and lack of anonymity. With more companies, and now state and local governments (i.e. Miami and New Hampshire) looking into cryptocurrency payment integration, consumers will have to be more diligent on how they spend their crypto and what they want to show. WAGMI.

Sites to help with NFT/Crypto Taxes: 

Mathcastles Turning Heads đź‘€

  Critics outside of the NFT space like to hurdle plenty of insults at it. The ones who want to protect the sanctity of true art will point to PFP projects in particular and criticize them for being lackluster or lacking artistic complexity. They might have a case if they depended on any other sources than web2.0 platforms that like to characterize the NFT space as nothing less than a Ponzi scheme. But this just isn’t true, artists are taking the new digital format seriously and innovating in it. Artblocks as an NFT ecosystem and the Mathcastles project, in particular, exemplify this.

Mathcastles, or what is also referred to as Terraforms are vivid and engaging artistic formations. Each Terraform represents the interaction of the minter with the blockchain. This Twitter thread does a brilliant job at explaining the genius craftsmanship involved in each Terraform. With projects like these, the NFT community has plenty of material to show that artists are taking the digital form seriously and that curators are also taking the inventiveness and creativity of worthy artists just as seriously.

What has driven interest in PFPs are their digestibility. And projects like Invisible Friends show us that there are ways of creating digestible art projects that are both simple and simultaneously refined and avant-garde. The value proposition for pieces that make sense to an audience is higher at the moment than projects that are entirely abstract. Terraforms reconciles the kind of abstract technical aspects of on-chain generative art with a visually compelling and interactive format. Its appeal is indicated in the way its floor has been surely but steadily rising from a .15 ETH mint to a roughly .7 ETH OS floor. There is good reason to believe that projects of high artistic merit such as Chromie Squiggles are here to stay and in a lane of their own. Terraforms might be on a similar trajectory.   

Meme Drop đź’§

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Disclaimer: The Drop DOES NOT provide financial advice. All content is for informational purposes only. The Drop is not a registered investment, legal, or tax advisor or a broker/dealer. Trading any crypto-related asset is extremely risky and could result in significant capital losses.  

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