CryptoPunk Owner’s $100k Blunder: How to Keep Your NFTs Safe

In a failed experiment, a CryptoPunk NFT owner sent his NFT valued at $130K to a burn address.

User tossing his CryptoPunk into a fire oven.
  • An NFT trader accidentally burned his CryptoPunk. 
  • The CryptoPunk owner was following a guide to wrap his NFT. 

Although innovative and ground-breaking, the crypto industry is a breeding ground for expensive mishaps. Worse, these blunders are permanently inscribed on the blockchain for everyone to see.

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While many make mistakes, few do on the scale of Brandon Riley, an NFT Trader who accidentally burned his prized CryptoPunk NFT worth over $100,000.

Wrapping Nothing

On March 25, Brandon Riley, the owner of CryptoPunk #685, turned his NFT valued at 77 ETH, or around $131,000, into ashes. The trader unwillingly sent his precious digital asset to the afterlife with a symbolic Nordic funeral. 

CryptoPunk #685 now sits at a burn address on the blockchain, removed from circulation and everyone’s access.

Riley bought CryptoPunk #685 two weeks ago, according to EtherScan. The devastated owner shared that he failed to wrap his NFT, which he intended to use as collateral for a loan on NFTfi.com to earn a yield of 7% per annum. 

Guide to Nowhere

CryptoPunks is a pioneer NFT collection, considered a “blue chip” project. However, since it was created before ERC-721 was introduced, it is incompatible with some marketplaces and platforms, like NFTfi.com. 

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Riley recounted that he was following a guide, trying to wrap his digital art as an ERC-721 token to make it compatible with NFTFi.com’s requirements. However, in doing so, the CryptoPunk holder accidentally entered the wrong address, forever losing his NFT. 

Later, users on Twitter pointed out that the guide initially used by Riley had been updated with additional instructions after the owner shared his demise on the platform. 

Hoping for some miracle, Riley asked CryptoPunk IP owners Yuga Labs if he could buy the V1 version of his NFT. Original CryptoPunks smart contracts had a bug that allocated Ethereum to the buyer instead of the seller. So Larva Labs, the creator of CryptoPunks, replaced V1 smart contracts with a new version and refunded everyone. 

Yuga Labs has yet to respond to Riley’s request for a reprieve. 

The pricey slip-up should be considered a lesson to all. However, DailyCoin is here to guide you on how to keep your NFTs safe. 

Guide for Safety

Due to the immutable nature of blockchains, slip-ups are permanent. Therefore, taking the necessary precautions when dealing with digital assets like NFTs and crypto is essential. 

The NFT sector is swarming with malicious actors looking for new victims. So, it’s also essential to do your due diligence in taking as many preventive measures as possible. 

Here’s a quick list of pointers to save you from future blunders: 

  • Set up additional layers of security, such as two-factor authentication (2FA). 
  • Double-check all links, and never click unverified links. 
  • Ensure the information comes from official collection social media accounts. 
  • Verify and inspect all addresses, such as contract address, sender address, and more, before doing anything permanent. 
  • Keep your recovery phrase and seed phrase safe. 
  • Do your own research.
  • Ask for help from officials. Don’t hesitate to ask questions that prioritize safety and security. 

On the Flipside

  • Recently, the owner of one of the most valuable Bored Ape NFTs, BAYC 1626, burned his NFT on Ethereum to inscribe it on Bitcoin. 

Why You Should Care

Accidentally burning NFTs, inputting the incorrect address, and clicking the wrong links are common mistakes in the NFT sphere. Although the scale at which these blunders happen differs, these slips happen frequently. Therefore, it’s important to do your due diligence and double-check everything. 

Learn how to protect yourself from scams:
How Auditors Detect a DeFi Rug Pull Scam: Can You Do It Yourself? 

Read more about Bitcoin Ordinals marketplaces:
Gamma Launches Trustless Bitcoin Ordinals Marketplace 

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Insha Zia

Insha Zia is a senior journalist at DailyCoin covering crypto developments, especially in the Cardano ecosystem. With a Bachelor of Science in Computer Systems Engineering, he delivers high-quality articles with his technical background and expertise in data analysis and programming languages, aiming to educate and inform readers accurately, transparently, and engagingly. Insha believes education can drive mass adoption of the crypto space, and he is committed to giving DailyCoin readers a better understanding of the technology.