This week on the whoopsies, an NFT collector accidentally burned a CryptoPunk NFT they had just purchased for a whopping 77 ETH ($123,434).
NFT collector and investor Brandon Riley was attempting to “wrap” the NFT but ended up sending it to a burn address, which effectively destroyed the NFT. The accident disseminated a third of Riley’s net worth.
Wrapping is the process of putting the original asset in a wrapper pegged to the value of another token. It’s a sort of adapter that bridges one blockchain to another. Burning, meanwhile, is the process of removing tokens, typically coins, from circulation. It permanently puts the asset in an address outside the network where it can no longer be used.
Riley thought he was following wrapping directions exactly, and has said that since he isn’t a developer and is “not at all familiar with these contracts,” he should’ve had another set of eyes to check what he was doing.
The burned NFT is part of the CryptoPunks project, which is considered to be one of the most popular NFT collections. It features 10,000 8-bit characters and was released in 2017. The collection has some of the world’s most valuable NFTs — the most expensive one, CryptoPunk #5822, sold for $23.7 million in February 2022.
Information for this briefing was found via Twitter, Binance, Investopedia, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
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