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ApeCoin DAO Picks Arbitrum for New “ApeChain” – What Does it Mean for BAYC?

Last Updated February 15, 2024 3:13 PM
James Morales
Last Updated February 15, 2024 3:13 PM

Key Takeaways

  • ApeCoin DAO has voted to approve AIP-378, a proposal to build “ApeChain” on Arbitrum.
  • The proposal was chosen over Optimism and ZK Stack-based alternatives.
  • Bored Ape Yacht Club (BAYC) and other NFT collections in the APE ecosystem could be boosted by the new platform.

Last month, ApeCoin DAO voted to build its own dedicated blockchain to make it easier and cheaper to transact with APE. Proposals were submitted to build  “ApeChain” on platforms including Arbitrum, OP Stack and ZK Stack.  After voting on different ideas, ApeCoin DAO settled on AIP-378 , a joint proposal put forward by Horizen Labs and Offchain Labs to build the new platform on Arbitrum Orbit.

The new chain will likely increase ApeCoin’s liquidity and the price of APE has responded positively to the news so far. But what about Bored Ape Yacht Club (BAYC) and other NFT collections in the extended ApeCoin ecosystem?

ApeChain a Potential Boost NFT Ecosystem 

As both a governance and a utility token, ApeCoin serves multiple functions within the universe of apps, games and events surrounding BAYC and other NFT collections developed by Yuga Labs.

At the moment, APE isn’t used to buy NFTs. But because it powers a host of corollary services for the collector community, the token’s price often moves in tandem with the market for Yuga’s various cartoon apes, dogs and mutants. 

However, as an ERC-20 token on Ethereum, APE’s usability has often been inhibited by exorbitant Layer 1 gas fees. 

To solve the problem, ApeChain will settle transactions on Arbitrum One. The ApeChain roadmap will also deliver a new implementation of APE as an OFT (omnichain fungible token) powered by LayerZero.

Growing APE’s Functionality

Arbitrum Orbit is a platform for building custom Layer 3 “app chains” on top of the Arbitrum One and Nova L2s. 

From the outset, ApeChain has been envisioned as a Web3 gaming solution requiring a high throughput and customizable tokenomics. 

One of the major advantages offered by L3s is that ApeChain will use APE for gas fee payments. This means community members will be able to participate without needing to hold ARB or ETH.

ApeCoin Decentralization

As the ApeCoin ecosystem evolves into a more sophisticated gaming and NFT platform, it is expanding beyond BAYC and Yuga Labs.

Of course, Yuga remains the driving force behind new NFT projects and one of the largest APE holders. Nevertheless, in the ApeChain era, there are more possibilities for 3rd parties to enter the space and develop applications centered on BAYC or other relevant collections.

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