Reviewing Modular's Metaplex Thesis

Key Insights

• Modular Capital released an investment thesis on Metaplex’s MPLX token last week. Their base case highlighted a potential $500M market cap, while their upside case highlighted a potential $3b market cap.
• Their case relies on the continued exponential growth of Metaplex’s Bubblegum service, which powers the majority of compressed NFT minting on Solana.
• Drivers for growth include greater adoption of Solana-based consumer applications in DePIN, gaming, social, or other verticals.
• Risks include NFT product market fit, market share erosion, Solana dependency, and lack of strong token value accrual.

The What

Modular Capital recently released a thesis highlighting one of the few projects able to grow during the bear market: Metaplex. Modular’s thesis gives a range of outcomes based on future growth assumptions for Metaplex’s main service, Bubblegum. Released in March of this year, Bubblegum has been responsible for effectively all compressed NFT minting on Solana over the last year.