CryptoPunks NFT Worth $1.5 Million Just Sold for $23,000—Here's How - Decrypt (decrypt.co)

submitted 2 months ago by overflow64@lemmy.ml to c/crypto@lemmy.ml

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[-] rinkink@lemmy.world 9 points 2 months ago

"Worth"

[-] slazer2au@lemmy.world 6 points 2 months ago

Here's how

not much of a secret, it was a bubble, the bubble has popped, now we wait for the next one.

[-] dhork@lemmy.world 12 points 2 months ago

Did you read the article? The price of those NFTs might be a bubble, but the transfer has nothing to do with the bubble.

The main trading platform for that NFT no longer exists. The guy looked at the smart contract, though, and concluded there was a way he could put in a bid for all shares that automatically executed after 2 weeks as long as no one else declined. So he made his own transaction with a low-ball offer, and bet on no one noticing because without the platform it would be much harder to notice.

Pretty clever.

[-] PowerCrazy@lemmy.ml 5 points 2 months ago

But now he has what? A piece of code that says he has non-exclusive ownership* of some bits on a particular exchange, and he paid 23k for that privilege?

*There are no legal frameworks that enforce his ownership of said item. Additionally their are no technical hurdles that prevent other from the same ownership.

[-] dhork@lemmy.world 4 points 2 months ago

Additionally their are no technical hurdles that prevent other from the same ownership.

That part isn't true, strictly speaking. Blockclain-based systems operate by building blocks on top of each other, in a cryptographically secure fashion. Yes, he bought a bunch of bits, but they are cryptographically secure, on that blockchain, and as long as he takes good care of his bits (and their relation to the smart contract, of course, since he gained control with a smart contract exploit in the first place), they can't be arbitrarily taken away.

Yes, it's all enforced by software, but the same code will make sure that the bits aren't transferred away until a valid transaction appears. Since all nodes have to agree the transaction is valid, be can't just change the validation code himself. Other nodes will reject it. To pull off the heist, he had to work within the bounds of the smart contract to make a valid transaction that did what he wanted to do.

Now, I can't explain why these dumb apes are worth so much, but that's a separate issue. He does actually own the bits now. I would think no one would want to buy them now, though, but the article claims there are already higher bids for the same bits.