A group of investors has taken legal action against Sotheby’s auction house, celebrities like Paris Hilton and Justin Bieber, and other entities, accusing them of misleading promotion of the Bored Ape Yacht Club NFTs and alleging that these parties colluded to artificially inflate the prices of these digital collectibles.
In the recent past, these NFTs were trading in the $350,000 to $400,000 range. However, their market value has plummeted, with some BAYC NFTs currently bubbling around $50k. The lawsuit points to a particular event in September 2021 when Sotheby’s auctioned more than 100 of these NFTs for a staggering $24 million, far exceeding the pre-sale estimate of $12 to $18 million. The plaintiffs argue that this sale was deceptive and aimed at generating unwarranted hype around the Bored Ape brand.
Sotheby’s has responded, stating that the allegations are baseless and that they are prepared to defend their position. Representatives for Paris Hilton and Justin Bieber have yet to comment. Yuga Labs, creator of the Bored Ape Yacht Club NFTs, has dismissed the allegations, emphasizing the company’s role in fostering a community-driven approach to NFTs.
I can’t blame the investors for trying, but I hope the investors lose – and lose huge. If they purchased the artwork (an NFT is a proof-of-ownership receipt, not the artwork) to enjoy, nothing has changed. The art is the same, and if they thought it was artistic and worthy of owning at the price they paid, they can still enjoy it. If, on the other hand, the investors purchased the BAYC artwork as an investment, believing that (at some future time) they would be able to sell the assets at a profit… caveat emptor.
Author’s note: This is not a sponsored post. I am the author of this article and it expresses my own opinions. I am not, nor is my company, receiving compensation for it.