The rarer an item, the higher its value. As previously mentioned, no two CryptoPunks are alike, thus this scarcity leads to people paying lofty prices if they wish to own one. The hedonic value comes into play too when valuing an NFT. This refers to how much enjoyment the consumer gets out of the product.

What is the point of CryptoPunks?

A CryptoPunk is a 24x24 pixel, 8-bit-style unique avatar that comes in the form of an NFT. Their creation began as an experiment, conducted by software developers Matt Hall and John Watkinson in 2017. The pair wanted to create a software program capable of generating thousands of unique avatars.

Why are some NFTs so expensive?

The NBA controlled how many were in circulation and fans, wanting to own their favourite player card, traded them on a blockchain-based marketplace. Things have value when they're scarce. And because you can't copy and replicate an NFT, some people see them as valuable.