Avalanche, Flow, and Others Are Interested in the ApeCoin Migration

Yuga Labs and ApeCoin DAO board members are listening to bids to migrate ApeCoin off Ethereum after Yuga Labs' disastrous non-fungible token (NFT) minting for its "Otherside" metaverse land sale cost investors more than $100 million in transaction fees, CoinDesk has discovered.

Avalanche and Flow are the networks' two bidders, according to executives from both networks. Both blockchains believe they are better suited to host a large-scale NFT ecosystem like Yuga's.

At the end of an April 30 Twitter conversation, Yuga Labs "encouraged" the decentralized autonomous organization (DAO) constituted of APE holders to consider a possible ApeCoin migration.

This has been the largest NFT mint in history by several multiples, and yet the gas used during the mint shows that demand far exceeded anyone’s wildest expectations. The scale of this mint was so large that Etherscan crashed.
— Yuga Labs (@yugalabs) May 1, 2022

However, an ApeCoin Foundation insider confirmed to CoinDesk that, despite no prior consideration, the board of directors has been debating whether to migrate to a new layer 1 as a result of the tweet, and that conversation is still ongoing.

In spite of the DAO Board's stated stance that it is not "actively shopping" for new chains, it recognizes its obligation to fulfill the DAO's requests, including chain migration if it is approved by the DAO's voting members.

With Reddit co-founder Alex Ohanian and Animoca Brands chairman Yat Siu on the board, ApeCoin promises to be an exciting new cryptocurrency.

Since its inception in March, the DAO has voted on 11 different proposals. A request for comment from CoinDesk regarding the impact of Yuga Labs was not answered directly.

The argument for AVAX and FLOW

It's possible that Yuga's ecosystem would be able to operate on its own subnet in the event of an Avalanche shift, a technique that lets the transactions of a single application to be separated without slowing down the rest of the Internet.

Avalanche pledged $290 million to luring subnets in March, however talks with Yuga remain preliminary.

Founder and COO of Ava Labs, Kevin Sekniqi, told CoinDesk that the company has already begun negotiations with Yuga about subnets. NFT ecosystems of this magnitude require a scalable environment, as demonstrated by the land auction.

Similar to Flow's blockchain, NBA Top Shot has shown its ability to handle huge transaction volumes with tens of thousands of transactions per day, making it ideal for high-volume trading.

Following the infamous CryptoKitties NFT crisis, which momentarily choked Ethereum, Dapper Labs, the company behind Flow, also established the blockchain as a result of the same necessity.

"We've had some interactions with board members [of ApeCoin DAO] and I think it's going to come down to a vote," Mik Naayem, chief business officer of Dapper Labs, said in an interview with CoinDesk. That said, "I think that Flow would be a wonderful home for [ApeCoin], but there are still a lot of assets on Ethereum and things to consider."

Both positives and negatives

Lower transaction costs, quicker network speeds, and the possibility to pay gas taxes in APE are just some of the advantages of Yuga transferring its ecosystem to its own chain. However, there are clear issues that could arise from the move, including as how the corporation would handle its $1 billion worth of Ethereum assets.

There could still be a lot of issues, even if it has its own chain. For many, Axie Infinity is a cautionary story of migration after a $625 million exploit of its gaming-focused Ronin network was discovered. As an alternative, a new Web 3 game phenomenon called Crabada has evolved from its own Avalanche subdomain.

According to Naayem of Dapper Labs, the choice to migrate chains would be made by ApeCoin DAO members, an entity over which Yuga has stated it does not have control but surely influences.