The NFT sector took the world by storm in 2021 as crypto and corporate sector influencers, globally recognized companies and popular sports teams embraced the growing digital collectible trend.
After a brief sector-wide pullback which coincided with the market-wide declines seen beginning in May, the NFT sector roared back to life as collectibles like CryptoPunks, Pudgy Penguins and Bored Ape Yacht Club (BAYC) selling for record-breaking prices.
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One project that has benefitted from the recent bull market in the NFT sector is Aavegotchi (GHST), a decentralized finance (DeFi) focused NFT ecosystem that runs on the Aave protocol.
Data from Cointelegraph Markets Pro and TradingView shows that since reaching a low of $0.896 on June 22 the price of GHST has rallied 202% to reach a new record high at $2.74 on Aug. 13.
Three reasons for the bullish price performance for GHST include, excitement for the upcoming Haunt 2 portal drop, income opportunities offered from selling Gotchi’s and wearables and the launch of new mini-games that help to attract new users.
Upcoming portal drop excites the community
The biggest development to come out of the Aavegotchi community recently was the announcement of the second 'Haunt' which is scheduled to happen from Aug. 26 to Aug. 29.
In Aavegotchi, Haunts are the only opportunity to obtain newly released Gotchi’s, the in-game characters of the ecosystem, and they are summoned through ‘portals’ which are raffled during the Haunts.
As the name implies, Haunt 2 is only the second portal drop to occur for the Aavegotchi ecosystem and it will introduce 15,000 new Gotchi’s to the protocol. 12,000 are available via a bid-to-earn auction and 3,000 through a raffle.
All bids are made using GHST tokens and raffle tickets can be purchased with FRENS, a digital asset earned as a reward for staking GHST on the Aavegotchi protocol.
Traders accumulate GHST to buy and sell Gotchis and wearables
A second reason for the growing strength of GHST is the income opportunities generated when participants engage with the platform.
As previously mentioned, there has only been one Haunt that has released portals capable of summoning Gotchi’s and to date, 6,992 of the 10,000 portals have been claimed. The most recent statistics show that 425 Gotchi’s have been sacrificed, meaning that there are currently 6,567 Gotchi’s in existence.
Raffles offer users the opportunity to win wearable items that range from 'common' to 'godlike' and they can be used as accessories to increase a Gotchi’s value.
Due to the rarity of both Gotchi’s and wearables, some users have managed to earn a significant return on investment by selling them in. the secondary markets.
Now that a new opportunity to obtain low-cost portals and free wearables through raffles — both of which require GHST— is approaching, demand for the token is likely to continue to increase until Haunt 2 is complete.
On that note, it is also prudent to offer a word of warning that Haunt 2 has the potential to be a “buy the rumor, sell the news” type of event and it could result in a decline in the demand for GHST. In many instances, altcoin prices have dropped once the actual product delivery or hard fork upgrade is complete.
Related: OpenSea trading volume explodes 76,240% YTD amid NFT boom
NFT summer brings an added boost
A third reason for the bullish price move in GHST has been the overall performance of NFTs over the past couple of months which has led many to refer to it as an ‘NFT summer’.
The bullishness seen across the NFT space has translated into price increases in the GHST token as well as the various collectibles offered in the ecosystem.
With the momentum behind NFTs continuing to build as Aavegotchi prepares to increase the number of collectibles in its ecosystem, it’s possible that the value of both GHST and in-game items could continue to rise as new participants discover this unique merger of NFTs and DeFi.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
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