Justin Bieber spent a small fortune on a Bored Ape NFT in January, but less than one year later the value has plummeted due in part to the collapse of Sam Bankman-Fried’s FTX, according to a report from Business Insider.
The 28-year-old pop star purchased the non-fungible token for 500 of the cryptocurrency ethereum, which is equivalent to $1.3 million. However, the value of the NFT has dropped to only 58 ethereum, or $70,000, Business Insider reported.
It’s all related to the collapse of crypto exchange company FTX, which was headed by big-time Democrat donor Bankman-Fried. The company’s implosion affected crypto prices across the board, which in turn decreased the value of Bored Ape’s NFTs.
Bored Ape Yacht Club (BAYC), known informally as Bored Ape, is an NFT art collection with a value of more than $1 billion. The NFTs are recognizable as they feature profile pictures of cartoon apes that are generated by an algorithm.
Besides Bieber, other celebrities who have purchased Bored Ape NFTs include Jimmy Fallon, Snoop Dogg, Eminem, Gwyneth Paltrow, Madonna, Neymar, Paris Hilton, Timbaland, and DJ Steve Aoki.
Crypto messaging company XMTP founder and CEO Matt Galligan explained the Bored Ape phenomenon, telling The New Yorker, “It became a status symbol of sorts, kind of like wearing a fancy watch or rare sneakers.”
The founder said he and his business partner chose apes because putting significant capital into new crypto currency or NFTS is called “aping in,” and they also “just like apes.”
But even the popularity of Bored Ape NFTS wasn’t enough to withstand the spectacular downfall of FTX. The Bahamas-headquartered company was launched in 2019 and grew to more than one million users by 2022.
When it was revealed that both FTX and Alameda research had overlap on their balance sheets, users demanded $6 billion in withdrawals and tanked the value of the company. Bankman-Fried went from having a $15.6 billion net worth down to being broke in the span of two days.