Sour grapes or a statement of fact? Community analysis: Why are boring monkeys like multi-level marketing?

The cryptocurrency community describes Bored Ape Yacht Club (BAYC) as a multi-level marketing product, where developer Yuga Labs continuously releases new projects to attract new users to hold BAYC and participate in the Bored Ape ecosystem, offering the promise of expected returns. This strategy is used to maintain and boost the price of BAYC, and is the only way for Yuga Labs to generate income.

Similarities with Multilevel Marketing?

Ivan believes that BAYC holders are akin to direct sellers in a direct sales system, with BAYC selling an airdrop product. They attract newcomers to pick up BAYC through massive marketing of airdrops like BAKC, Mutant Apes, Otherdeed, and Sewer Pass.

Users become new holders due to the anticipation of future airdrop promises, as depicted in the image below:

I've made so much money in just one year! Imagine how much you can earn by buying in now? Yuga Labs will always serve the holders.

Continuously Attracting Potential Newcomers

Ivan mentioned that new holders are not making as much profit as initially thought, especially with most users who directly buy into the Otherside of the Apes losing money.

However, Yuga Labs continues to push for the next project because selling "ecosystem entry tickets" to newcomers is the only way to generate income. They reintroduced the game pass "Sewer Pass" in January.

Some even began hoarding physical BAYC merchandise, expecting to make a big profit in the future.

My dumbass bought around $30,000 in bayc merch. What a joke

— COLOMBO (@Jdotcolombo) February 17, 2023

Evolution into a Belief System

Ivan mentioned the high loyalty of some holders to Yuga Labs and their inability to accept external criticism.

Users looking to enter the ecosystem occasionally participate in relevant seminars on Twitter. More extreme than traditional direct sales, these Twitter Space seminars occur daily for several hours, where success stories are shared, and dissent is not accepted.

Worth a listen.

The state of discourse within BAYC. Here, we can see that the hosts fully dismiss the organized, fact-based content of the criticism. They refuse to engage in any open discussion. Also observable, a clear discomfort around thoughtful concerns being raised at all pic.twitter.com/Di7brDTDBR

— Ø Ivan (@Ivan87403) February 3, 2023

Community Feedback, Debates

Community responses to Ivan's tweets vary from agreement to criticism. Here are some summarized community replies:

Q: So if I find a great product at Costco, I can't tell anyone about it, or it becomes direct sales?

Ivan: No, multilevel marketing is a specific structured organization that attracts people with promises of high income, life improvements, etc., resulting in most people losing money, with most funds coming from contributions by newcomers.

Q: One clear distinction is that BAYC doesn't have a referral code; early users in typical MLMs can directly earn a certain percentage of income through newcomers.

Ivan: Agreed, but I think the presence of a referral code is not important. I initially considered this issue from the perspective of group psychology, and BAYC's incentive structure does resemble MLM, causing harm to users economically and psychologically.

Q: If BAYC is MLM, then all NFT projects are.

Ivan: I agree that most projects have similar characteristics, but I have never seen the MLM concept applied to projects at so many levels; BAYC possesses all the funds and influence to implement MLM mechanisms.

No Regulation, No Problem

The highly visible Yuga Labs has faced similar scrutiny before, with CNN recently reporting extensively on their use of celebrity hype tactics.

However, as long as regulatory bodies do not target them, these criticisms seem inconsequential to Yuga Labs.

CNN Feature | Celebrities, YugaLabs, and payment processors deliberately hype up Bored Apes to line their pockets