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$1.7 Million in NFTs stolen on OpenSea

$1.7 Million in NFTs stolen on OpenSea

OpenSea, an online marketplace, says it is now worth $13.3 billion (£9.8 billion) after receiving a $300 million investment.

NFTs (non-fungible tokens), unique pieces of digital code that can be linked to a digital asset like a piece of digital art, can be traded on the platform.

Some NFTs have been sold for millions of dollars.

OpenSea claims that trades on its platform increased 600-fold in the previous year, although some detractors claim that the valuation is excessive.

According to Devin Finzer, Finzer, a co-founder of the company who created it in 2017: "In 2021, the globe woke up to the fact that NFTs constitute the essential building blocks for fresh new peer-to-peer economies."

Many believe the rising value of some cryptocurrency businesses is due to a lack of venues for investors to invest.

"There is too much money floating around and far too few places to deposit it," author David Gerard stated. Lottery tickets are purchased by even the rich.

Bored Apes

OpenSea's valuation comes at a time when more companies, sports teams, and celebrities are creating or buying NFTs.

Eminem just paid $450,000 on a portrait of a "Bored Ape" that looks like him.

There are tens of thousands of digital illustrations of anthropomorphic apes in the Bored Ape Yacht Club.

According to data from Cryptoslam, a NFT industry data collector, the total value of trades for Bored Apes just topped $1 billion.

The rapper's admiration for the digital artworks isn't shared by everyone. Art critic Jonathan Jones described them as a "quite conventional and derivative piece of comic book design" in a Guardian review.

While the apes' facial expressions, headgear, and attire are all available options, BAYC claims that each image is "unique and programmatically generated".

According to the Financial Times, the market for digital art and collectibles has surpassed the worldwide art industry.

Blockchain research firm Chainalysis put the overall value of NFT transaction at $40.9 billion last year, according to the paper.

An overestimation is likely since only NFTs built on the Ethereum blockchain were examined.

According to the report, the worldwide art market generated $50.1 billion in revenue in 2013.

New financing from the OpenSea Foundation will be used to promote NFTs to a wider audience and remove their "barriers to entry," the company stated in a statement.

Consumers, on the other hand, may be unaware of the hazards associated with mostly unregulated crypto-asset investments like NFTs, according to regulators and critics.

Expert investors, according to Chainalysis research, make the greatest money out of cryptocurrency.

Other analysts are concerned about so-called wash-trading, where investors sell and then purchase back an NFT they possess in order to increase demand.

Critics are also concerned about the environmental impact of NFTs' technology.

The ownership of NFT is recorded on a distributed ledger known as the blockchain, which is updated by hundreds of computers around the world, just like with crypto-currency.

Keeping all of those computers running consumes a lot of electricity, which in turn produces pollution.

Hundreds of NFTs were stolen from OpenSea members on 19th Feb, raising fear among the site's large user base. Decentraland and Bored Ape Yacht Club tokens were among the 254 tokens stolen during the hack, according to a spreadsheet compiled by the blockchain security service PeckShield.

Web3 is Going Great blog owner Molly White put the stolen tokens' value at almost $1.7 million.

However, the initial count was updated to 17 after 15 of the initial 32 users had communicated with the attacker, but had not lost tokens as a result of that interaction.

The Wyvern Protocol, the open-source standard underpinning the majority of NFT smart contracts, including those built on OpenSea, appears to have been attacked in the hack. First, targets signed a partial contract with a general authorization and major chunks left blank, according to one explanation (posted by CEO Devin Finzer on Twitter). Hackers could only transfer ownership of NFTs without paying for them after signing the contract. As a result, the victims of the attack signed a blank check, which the attackers then used to withdraw their funds.

The user, who goes by the handle Neso, claimed to have double-checked every transaction. They all have genuine signatures from people who lost NFTs, thus anyone who claims they weren't phished but lost NFTs is unfortunately false."

An open platform for listing, browsing, and bidding on tokens without having to engage directly with the blockchain has made OpenSea one of the most valuable NFT startups, with a recent investment round valuing the company at $13 billion. As a result of its success, however, the company has faced serious security challenges, including hacks that used obsolete contracts or poisoned tokens to take precious holdings from customers.

When the attack occurred, OpenSea was in the middle of modernising its contract system, although OpenSea has denied that the new contracts were the source of the attack. Because there are so few targets, such a problem is unlikely to be exploited on the same scale as a flaw in the platform as a whole.

The attackers' strategy for convincing victims to sign the half-filled contract is still a mystery, as are many other aspects of the attack. CEO Devin Finzer tweeted soon before 3AM ET that the attacks had not come from OpenSea's website, its numerous listing systems, or any of the company's email communications. So yet, no link has been found between the attack's rapidity and the fact that hundreds of transactions were made in a few of hours.

This information will be updated when we discover more about the phishing attack, Finzer promised on Twitter. Please DM @opensea support if you have specific information that could be helpful."

Hackers could only transfer ownership of NFTs without paying for them after signing the contract.

More than two dozen of OpenSea's users have been unable to access their most precious digital tokens after a "phishing attack" on the NFT marketplace.

The timing of the attack couldn't have been worse for OpenSea, despite the fact that we still don't know much about it. People were asked to shift their assets to a new smart contract on Friday. First there was an employee who resigned for profiting from NFT drops, and then there was the proliferation of tokens that are false, plagiarised, or spam on the network.