A rare CryptoPunk non-fungible token (NFT), valued at millions of dollars, was acquired for a mere fraction of its worth through a clever exploitation of smart contract mechanisms., in an incident that was described as a brilliant “heist.”
NFTs from the CryptoPunk collection are some of the most expensive on the market and can cost several million dollars. As a result, some are fractionalized to split their ownership among various entities.
The CryptoPunk in question, a coveted Ape-themed NFT with a headband and small shades, had been fractionalized into 10,000 parts on the now-defunct platform Niftex. Despite the platform’s closure, the underlying smart contracts remained active on the blockchain.
These contracts, as Cointelegraph reported, included a “shotgun” mechanism, which allowed any shareholder to propose a buyout at a specified price. If no one countered the bid within a set timeframe, the NFT would be transferred to the proposer.
Seizing this opportunity, a trader proposed a buyout for just 10 ETH, worth around $23,000, a mere fraction of the NFT’s true value. The move caught the attention of renowned NFT collector gmoneyNFT, who attempted to block the sale by placing a counterbid. However, due to a technical oversight, the counterbid was invalid, allowing the buyout to proceed.
The NFT that was bought for 10 ETH is now already receiving bids for 600 ETH, meaning that the seller, which managed to obtain the fund by seemingly going unnoticed in the process, could now sell it back for $1.4 million.
While some in the NFT community believe the smart contracts should be adjusted because of what happened others, including gmoneyNFT, suggest that the smart contracts “worked as intended.”
Featured image via Unsplash.
