It’s been a wild year for NFTs, and along the way, there have been some spectacular losses, mistakes, and questionable choices made by people in the space.
We’ve collected them here for you: the most notable Ls that NFT collectors, creators, and marketplaces took over the course of 2022.
These aren’t necessarily the largest losses purely measured by dollar amount, and they’re not ranked. But they all stood out to us at Decrypt in the course of our reporting this year.
Some of them are just baffling miscues, and in the best of cases, the people involved took the L, owned it, made things right, and moved on. Many of these cases may be a lesson to collectors in 2023 to make wiser choices—and avoid self-inflicted wounds.
An ENS goof gone wrong
Pseudonymous collector Franklin is well known for his massive Bored Ape Yacht Club collection—currently 60+ NFTs, but it changes regularly—not to mention his constant flipping to eke out profits large and small on trades. But he also has a tendency to air out his Ls, as he did with a mistake around an Ethereum Name Service (ENS) name last summer.
In July, Franklin placed a “joke” offer of 100 ETH (about $150,000 at the time) on a long-winded ENS domain that he owned through an alternate wallet, just to create some Twitter buzz and have a laugh.
But then he sold the stop-doing-fake-bids-its-honestly-lame-my-guy.eth ENS domain without canceling the offer from his other wallet, and the new buyer accepted the pending 100 ETH offer and raked in the profits.
“This will be the joke and bag fumble of the century,” he tweeted. “I deserve all of the jokes and criticism.”
Logan Paul shares his L
YouTube star Logan Paul didn’t mind sharing his biggest L from 2021’s speculative bubble, all while trying to make something better of it. In August 2021, Paul spent $623,000 on an NFT from 0N1 Force, a profile picture (PFP) project that launched as the market reached new peaks. A year later, the hype is gone and 0N1 Force NFTs start at about $460 worth of ETH.
In July, Paul tweeted that the NFT was “worth essentially nothing,” and said he would “immortalize my mistake” by taking a photo of himself in a replica costume and selling it as an NFT in his Originals project. It sold for just under $20,000 worth of ETH.
Akutars get locked up
Here’s a very painful reminder of why you can’t be too careful with coding smart contracts, which hold the code that powers NFT projects and autonomous decentralized apps. In April 2022, artist and former MLB player Micah Johnson launched his Akutars project, taking in tens of millions of dollars’ worth of ETH during the mint. And then it all went sour.
Soon after launch, exploits were spotted and triggered by unknown attackers, permanently locking the contract with all funds inside of it. Some $34 million worth of ETH (at the time) is now forever stuck in the smart contract, inaccessible by the creators or NFT buyers. Johnson vowed to persevere, relaunching with a new contract and refunding buyers who were due funds.
Bored Ape sells for $115
Earlier this year, it was common to see Bored Ape NFTs sell for hundreds of thousands of dollars’ worth of ETH—so when one sold for just $115, it was a total shock. This isn’t the first time or last that we’ve seen a blue chip NFT sell for a fraction of what it’s worth, but this was one of the more prominent examples from this year.
It’s still unclear exactly what happened, but the seller accepted an offer of 115 DAI, a dollar-pegged stablecoin. Some theorize that the seller mistook it for a 115 ETH bid, which would’ve been in the right ballpark of value (Apes started at 106.8 ETH, or $358,000 at the time). Others think it was intentional tax harvesting, perhaps designed to look like a mistake. A Mutant Ape was sold in tandem for $25 worth of DAI, only amplifying the (potential) losses.
FTX NFTs are stuck
To some, FTX’s entry into the NFT space in late 2021 felt like another legitimizing moment for the nascent market. A year later, amid the cryptocurrency exchange’s very public collapse and criminal charges for founder Sam Bankman-Fried, it has turned into another example of what not to do with NFT marketplace infrastructure.
FTX onboarded major brands into the NFT space, including concert festivals Coachella and Tomorrowland and Formula One team Mercedes-AMG Petronas, but now many of those branded assets are stuck on the marketplace amid bankruptcy proceedings. Other NFTs that users withdrew into self-custody wallets are no longer working properly, as the imagery is stored on FTX servers. It’s another red flag for marketplaces that take or keep custody of users’ NFTs.
Pixelmon’s reveal
At the peak of the NFT frenzy earlier this year, nearly anything with a little buzz around it could sell out and generate massive sums of cash in the process. One unfortunate example is Pixelmon, a clear-cut Pokémon knockoff with NFTs that clearly didn’t have much behind it.
After raising $70 million by selling monster NFTs, the artwork for those creatures was revealed—and it was terrible. Even the founder called the reveal a “horrible mistake.” A new team acquired the rights, launched more refined artwork, and is building a game around the NFTs. But they now trade for a fraction of the original mint price.
Coinbase rethinks Bored Ape films
At the height of the Bored Ape frenzy in April, Coinbase announced plans to create a short film trilogy based on the NFTs, even featuring Apes owned by community members. But when the first short rolled out in July amid a much weaker market, it was widely panned by viewers, who criticized the lack of Apes and awkward timing following significant Coinbase layoffs.
After that, it was radio silence until Coinbase confirmed to Decrypt in December that it opted to “pause production” on the remaining chapters. The firm’s statement left the window open for an eventual revival, but given the state of the NFT and crypto markets, we’d be surprised. Echoing recent comments from noted NFT artist Emily “pplpleasr” Yang, there’s a lot of money for Web3 video content, but not a lot of great stuff just yet.
Aurory’s FTX NFTs hit different
When FTX teamed up with Solana NFT game Aurory and esports giant Team SoloMid (TSM) to launch limited-edition NFTs in October 2021, the collaboration made a huge splash, with one of the auctioned NFTs even benefiting charity. But after the exchange’s downfall, the massive sums paid for some of the NFTs surely feels a lot different now.
In November, pseudonymous NFT collector Bardstocks tweeted, “380K USD down the drain” while sharing images of two of the Aurory PFPs with FTX apparel. “I was so excited to get these,” they added, lamenting the firm’s implosion. They are technically limited edition NFTs, but the FTX name doesn’t make quite the same impression today.
380k USD down the drain.
I was so excited to get these. I really believed FTX was going to be the Amazon of Crypto. They were just dramatically changing the expectations of exchanges. No clear warning signs and trusted by many.
Still surreal, but that’s just how it goes. pic.twitter.com/4w47dlk3wi
— Bardy 🦝 (@Bardstocks) November 9, 2022
$143K for gaming fan art
Pseudonymous NFT investor Pranksy has done very well in the NFT market, and has made major bets that have paid off in the past. But he’s also made some head-scratching moves along the way—such as paying $143,000 worth of ETH for a limited 1-of-1 Killer GF NFT back in January.
If you were forced to sell one particular #NFT today for it’s market price, what would be your biggest registered loss? I paid 55 ETH for this Zero Suit Samus style 1/1 Killer GF. It’s no fault of the @killergfnft team, just market and personal madness..https://t.co/Oiblziflf0
— Pranksy 📦 (@pranksy) October 16, 2022
It’s a lightly animated piece of fanart of heroine Samus Aran from Nintendo’s Metroid video game series, albeit tokenized as an Ethereum NFT and sold for a staggering sum. Pranksy blamed the “market and personal madness” for the purchase, and the NFT has a top offer on OpenSea of about $215 worth of ETH right now. Killer GF NFTs broadly start at just $165 now.
