Publicity stunt? Had it been true, it would have become the highest NFT sale ever, not just within the digital art space, but art in general.
Selling a token non-expendable (NFT) from the famous collection of CryptoPunks It caused surprises this week with its exorbitant valuation of more than $ 500 million.
A Twitter account that tracks sales of CryptoPunks first reported on the transaction yesterday afternoon (8pm ET). According to the report, CryptoPunk # 9998 sold for 124,457.07 Ether (ETH), valued at around $ 532 million at the time of sale.
– CryptoPunks Bot (@cryptopunksbot) October 28, 2021
The sum of USD $ 530 million would have made the sale of the NFT the highest in history, not only within the digital art space, but the art world in general. However, reports suggest that the operation was not legitimate and that it was possibly an elaborate publicity hoax.
The CryptoPunks are an NFT collection of pixelated humanoid figure designs that has become very popular this year. Usually the pieces sell for around six figures, although there have been a few exceptions from some punks who have sold for several million dollars. The market for CryptoPunks has a sales volume of more than USD $ 1.5 billion to date.
Currently the record for the most expensive NFT is held by the work “Everydays: The First 5,000 DaysBy digital artist Beeple, which was sold for a sum of $ 69 million in March of this year.
Bought and gave the change
The exuberant sale of the CryptoPunk caused suspicion among members of the community, especially due to the characteristics of the piece in question, # 9998, which, by not having a particularly rare design, makes it less desirable from a collector’s perspective.
Some users of the crypto space initially speculated that it could have been a typing error, while others suspected that the transaction could be linked to a money laundering operation.
Beyond guesswork, a close look at the records of Blockchain indicate that the purchase was made through a contract from lightning loan, or flash loan, a common lending practice within the decentralized finance (DeFi) space. After the loan was repaid, the NFT was returned to the original address of sale. Twitter user mariano.eth explained what happened:
[La dirección] 0x9b5a lends you 124,457 ETH from many sources
0x9b5a pays 124,457 ETH to the punk contract
The punk contract sends it to 0x8e39
0x8e39 returns it to 0x9b5a
0x9b5a returns the loan
In summary, the investigations indicated that a user had bought the NFT himself with the help of a quick loan in DeFi. Larva Labs, the company of the creators of CryptoPunks, also confirmed in a tweet the happened: “Simply put, someone bought this punk himself with borrowed money and repaid the loan in the same transaction“.
The transaction had a fee cost of 0.19 ETH, or about $ 800, and the address included a message in the transaction metadata that said “it seems weird.”
A publicity stunt?
Although the reasons why someone would go to the trouble of creating a flash loan just to buy an NFT that they themselves, or someone in their own group, owns are not entirely clear. However, it seems that the whole incident has turned into a great public relations stunt.
In this regard, the same Twitter user who explained the process, speculated on the reason for using a quick loan from DeFi to support the purchase of a CryptoPunk. “‘Cause it’s fun I guess and now we’re all talking about it“. What’s more, “shown as the biggest punk sale everHe added.
It seems that it is not the first time that something like this has happened. In accordance with CoinDesk, en february a user made a similar quick loan transaction to buy an NFT of HashMask for 139,000 ETH, valued at the time at around $ 200 million.
Although it is almost as if the sale of CryptoPunk for USD $ 532 million it would never have happened, it is still the most expensive ever registered in dollars. In addition, it could be said that the user achieved his mission: everyone is talking about it.
Hannah Estefanía Pérez’s version / DailyBitcoin
Image from Unsplash