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NFTs and Metaverse

NFT Collector Accidentally Burns $135k CryptoPunk NFT

NFT Collector Accidentally Burns $135k CryptoPunk NFT

Brandon Riley, a collector of non-fungible tokens (NFTs) from the CryptoPunks collection, accidentally sent a CryptoPunk NFT worth 77 ETH to a burn address, permanently deleting the NFT from circulation.

He intended to borrow some money against it to buy another NFT.

The unfortunate mistake

Riley added CryptoPunk #685 to his collection on March 13, paying 77 ETH. As a seasoned investor, he wanted to hold it for the long term and decided to borrow some money against it using a technique known as wrapping.

However, while going through the unfamiliar process of wrapping NFTs, Riley accidentally sent the asset to a burn address, permanently deleting the NFT from circulation.

The collector was devastated as he lost 77 ETH, worth around $135,372.16 at the time. Riley explained that he was not wrapping the punk to sell it on Blur but rather because he needed to borrow some liquidity from it. He further stated that he had purchased CryptoPunk #685 through borrowed money, contradicting rumors that he had “deep pockets.”

READ MORE: Salesforce and Polygon Introduce NFT-Based Loyalty Program

Community response

Crypto Twitter users sympathized with Riley and blamed confusing user interfaces and complex instructions for the investor’s loss. Many agreed that the front-end processes for crypto ecosystems needed to be revamped to prevent such mistakes from happening in the future.

Riley himself said that he shouldn’t have attempted the wrapping process on his own and has learned from the experience.

NFT wash trading on the rise

A CoinGecko report confirmed that NFT wash trading increased by 126% in February. The top six NFT marketplaces are Magic Eden, OpenSea, Blur, X2Y2, CryptoPunks, and LooksRare. X2Y2, Blur, and LooksRare saw a rise in wash trading for the fourth straight month, with a total volume of $580 million.

With the rise of NFTs and their increasing popularity, the industry must ensure that investors are adequately equipped to handle these digital assets. Riley’s experience serves as a reminder to investors to exercise caution when handling NFTs and to seek assistance when attempting new techniques. It also highlights the need for more user-friendly interfaces and instructions to prevent such mistakes from happening in the future.

Andrey Kunev

Reporter at CoinsPress

Andrey Kunev is a knowledgeable cryptocurrency content creator passionate about the crypto market. With extensive experience in market analysis and investment reporting, Andrey is a valuable asset to the CoinsPress team. As a frequent contributor, he offers insightful and comprehensive coverage of market trends, price fluctuations, and new advancements in cryptocurrency. Whether you're a seasoned investor or just getting started, Andrey's clear and concise writing offers a comprehensive look at the current state of the crypto market and its prospects. Stay up-to-date with CoinsPress's expert analysis and commentary on all things cryptocurrency.

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