Coffee giant Starbucks has just launched their very own cryptocurrency NFT project. The release of there nft has brought a lot of questions that were left unanswered. From why has the nft project sold out in only 18 minutes to what incentives does owning their nft give you?
Lets deep dive into Starbucks NFT also referred as The Starbucks Odyssey, and gather essential information from the benefits of being a Odyssey holder to their vision and purpose. But before that, let’s quickly understand what an nft is, and how it integrates with altogether.
what is an nft?
An NFT, or non-fungible token, is a digital asset that represents ownership online, your very own digital item, that can’t be fake or duplicated. NFTs are built on the Blockchain technology while providing a decentralized world. What makes NTFs so special is that once they’re created they cannot be duplicated and are able to be exchanged on a one-to-one basis, without the need of a middle man.
Because NFTs are built upon the blockchain technology, it allows a computer network known as ledger to verify the ownership, provenance, and transaction history of the specific NFT. This ensures the buyer full ownership without the uncertainty of knowing if it’s truly authentic.
NFTs can be purchased, sold and traded on various platforms through marketplaces such as OpenSea, Larva Labs, and Axie Marketplace. Transactions of selling or purchasing NFT’s often time involve the use of cryptocurrencies for payment, such as Bitcoin or Ethereum.
It’s important to be aware that NFTs are currently in its early stages and has faced criticism from the public. From the very volatile market conditions to the concerns regarding environmental harm with energy consumption.
What is Starbucks Odyssey NFT?
On March 9, 2023 Starbucks NFT Odyssey was announced and had released 2,000 units of their non-fungible token. The release of their project had little to no exposure on their websites or online platforms. Due to the low advertising efforts on the project, it has added rarity to holders.
However this is only the first release and Starbucks has indicated another release of Drop2 and Drop 3 offering much valuable rewards such as 30 days of free drinks or a special experience at Starbucks Reserve store.
Starbucks has stated they have envisioned a program to give there most loyal customers, with rewards that offer much greater value than just the rewards they’re currently receiving through the Starbucks App. While Starbucks is currently testing the digital world and monitoring the performance, to find out if the general public responses to the project in good spirit and corporates or will this endeavor potentially come to a end.
First Drop “The Siren Collection”
The first drop called “The Siren Collection,” is a Limited-Edition NFT to members on the invitation only list. The drop had a total of 2,000 units priced at a floor price of $100 and had such a high demand that it had crashed the Starbucks Odyssey website multiple times. Of course many members had complained about this issue which had prevented many people to participate and purchase there very own Siren Collection NFT.
What you get out of this NFT was something called “NFT Stamps” that members have unlocked through their purchase, for now it is said that these stamps will need to perform a certain array of tasks, including passing quizzes, completing Starbucks trivia or ordering a couple of drinks to increase your rewards.
During the beginning of the release the floor price was $100 at which people were only able to purchase two max. Quickly the prices had rose to $1,400 per NFT due to high demand but as of right now on June 8, 2023 the floor price of NFT from Starbucks is sitting at $415 which in fact is an amazing sign for the sustainability of this project. If the demand continues keeping the price above $350 it should be a great sign for the project as it’s considered to be the support zone for buyers. Level 1 will require 1,000-2,999 points and the rewards are a virtual coffee class, Starbucks coffee passport which gives you access to coffee or to make a charitable donation to Feeding America.
Second drop: First Store Collection:
Starbucks had release another set of NFTs called “First Store Collection. The release shows a series of images that very much look like postage stamps. Starbucks had decided to publish them on Nifty Gateway, where online digital-art takes place, and to receive the art is by minting them on Ethereum network called Polygon. Giving you full access to the NFTs.
The price for the “First Store Collection” had started at the same price as the first drop $100 each. Purchasing these NFTs earns users 1,500 points towards Starbucks Odyssey app which was launched by Starbucks in 2022.
In the first 30 days of the release, the Starbucks NFT had a significant amount of volume of $195,000 and overall volume of half a million dollars. Level 2 rewards gives you the opportunity to attend a virtual show and a Starbucks cold cup.
Level 3 Rewards:
As you hold the NFT and connect it to your account, you’ll be earning rewards off of purchasing coffee and being allowed into exclusive events and discounts. As you continue to engage with the NFT, you will progress through three levels which are level 1, level 2, and level 3. You’ll be unlocking additional benefits and rewards will continue getting greater.
why other similar projects have failed
Starbucks is not the first company in terms of releasing an NFT. Numerous fast food giants have also released NFTs such as Taco Bell, Burger King, Pizza Hut, McDonalds, and even Budweiser and much more.
Lets go over how these companies NFTs are doing now.
In 2021, Budweiser had made a huge announcement about potentially releasing its very own NFT and in early 2022, they have released “BudVerse Heritage Edition” a quantity of 1900. Their NFT launch had quite a lot of demand, in which the price of a single NFT had peaked in April 2022 at a price of $1300. Fast forward to June 2023 the price has had crashed all the way down to $150 floor. This raises concerns for the future of NFTs if its a risky investment regardless of how successful the company may be in the real world
Adidas had launched there very own NFT last year in which had a major success in which they’ve made $22 million dollars in a single day selling 30,000 NFTs at a floor price of $765 each. The reason for their huge success is because of there collaborations with very well known NFTs such as Bored Ape Yacht Club, and Punk Comics.
The floor price of there NFT is now a staggering $371 floor price equating to a 75% drop from the all time highs. If adidas is having a difficult time keeping up with the prices how would Starbucks perform from a year from now?
When should you buy the nft?
The NFT market, is known for very high volatile. It is not rare for a project to go from $1000 to $0 in a blink of an eye. This raises an important question: should you make a purchase now or wait?
Do the rewards make sense for you? Are you a loyal customer when it comes to there coffee? At what price makes you comfortable paying? All these questions must come into play before deciding to spend $300-$500 on a NFT. Understanding your own financial goals, how much risk you’re able to handle. If you’re looking to purchase this NFT as a short-term investment I would be a little cautious because it is not common for an NFT to have a continuous growth unless big news drives it. Looking for an NFT project that has a lot of great news consistently occurring increases the chances of a good investment.
If you frequently make a run to Starbucks for coffee and are considered to be a loyal customer, owning this NFT may be beneficial for you. Considering you’re already purchasing coffee, you can continue accumulating more points through the apps and grab those rewards. What makes the project really nice is because you’re offered 30 free cups of coffee in the rewards, the price of the NFT will have a very tough time crashing due to the rewards that are behind them already. However, if you rarely consume coffee or have no intention of using the rewards program, this project may not be the best fit for you.
When should you buy it from a technical standpoint: Understanding how markets work is important but I will help you have a better understanding. As someone who has traded in the markets for 6 years, I will break down strategies you can try out. Firstly we will need to have an understanding on why markets move up and down and its because there are “buyer” and “sellers”.
At some point when prices continue to drop the prices will eventually hit a strong “support” zone in which means an area where a lot of “buyers” are patiently waiting to get in, while thinking they’re getting a great discount. To find these support lines can be used in numerous ways from phycological numbers such as $100, $200, $300 are often times strong support zones.
Another way is using a very popular crypto exchange such as binance.com. Here you can practice identifying support zones, where price has hit a certain number and instead of continue crashing it instead “shot up” this is because buyers had intervened into the market and pushed the price up.
When should you buy it from a fundamental standpoint: When considering purchasing their NFT, its important o understand that technical analysis is important but so is fundamental. Having both analysis aligning with each other will have a high probability of making it a safer investment. Questions you may ask before investing into a project is- are they consistently declining?- market valuation- and evaluating the projects social medias, are they regular updating through twitter, Instagram or maybe even through there website. Conducting thorough fundamental research is essential.
You are not a shareholder
Having ownership on the NFT does not give you the same rights and privileges as being a shareholder of the Starbucks Stock (SBUX). While both involve ownership in some form, they both operate differently with one much greater control. When you purchase an NFT, you’re just in the unique digital asset. On the other hand, being a shareholder of SBUX involves owning equity in the company, which entitles you from special rights and benefits. Shareholders having the right to vote on the companies decision, while NFT holders don’t have the right to have a say. Starbucks Stock holders will also receive dividends as a share of the company’s profits and NFT holders don’t. It is important to understand that NFT ownership is not shareholder ownership, and if you’re looking for a safer investment when it comes to longevity safety, owning a Starbucks stock might be the wiser decision.
The purpose:
Starbucks Odyssey NFT is far more than just a few cups of free coffee and some rewards to claim. They have a larger purpose: in providing care, supporting those in need, and contributing to the world making a change.
This mission extends way farther. From Starbucks stores “Our vision for the future is to become resource positive-giving back more than we take from the planet. And we know we can’t do it alone. It takes all of us”.
Starbucks CEO, Laxman, has recently visited partners in China to engage further into the NFT project. The purpose was to discuss goals and projections, with not Starbucks but with the NFT projects, and how it can better the global welfare. Company’s efforts is only committed to creating a positive impact to the people and world giving a bright future to the company.
To conclude
As we bring this article to a close, we have dived into what makes Starbucks NFT special, including its overall purpose, to the incentives, when is the right time to purcase, and alternative options that may fit best for your needs. My aim was to give you a clearer understanding with valuable insights. I hope this article has been informative. Happy investing!