Whoops! $129k NFT Gone in an Instant

Article source, here.

TL;DR

• On Friday, an NFT trader accidentally burned (irreversibly destroyed) the CryptoPunk that he had purchased for 77 ETH two weeks ago.

• The key takeaway is that Web3 has a user experience problem.

• It’s a good thing that burn addresses exist, but the fact that the process of making some assets compatible with today’s DeFi applications is so difficult - that needs to change.

Full Story

Seb’s two-year-old niece has a new favorite saying: “accidents happen.”

It’s kind of cute and funny when she says it, but there’s at least one person not laughing about this accident.

On Friday, an NFT trader accidentally burned (irreversibly destroyed) the CryptoPunk that he had purchased for 77 ETH two weeks ago.

How do you just ‘burn’ an NFT?

Burn addresses are wallet addresses that can only receive digital assets (i.e. NFTs, crypto).

Once those assets are sent there, they’re permanently removed from circulation, never to be owned or traded again.

Brandon Riley was attempting to take a loan against CryptoPunk #685 through NFTfi.

We could get technical and discuss how CryptoPunks were created before ERC-721 was established as a token standard for NFTs, making them incompatible with some marketplaces and applications designed for DeFi.

But suffice to say, when Riley tried to ‘wrap’ his NFT (make it compatible with NFTfi), he accidentally sent it to a burn address, destroying it forever.

What’s the takeaway?

Web3 has a user experience problem.

If a sophisticated NFT trader can make a mistake like this, what chance do people have who aren’t quite so technologically savvy?

Burn addresses exist for good reason - for example, to reduce supply of some cryptocurrencies, making them deflationary.

It’s a good thing that they exist, but the fact that the process of making some assets compatible with today’s DeFi applications is so difficult - that needs to change.