Today marks the sixth anniversary of Cryptopunks, the NFT collection that sparked the revolution.
Here's the strange story of Punk 9998.
One of those stories that could only happen in the crypto realm.
In October 2021, the biggest NFT purchase ever took place.
A Cryptopunk sold for over 500 million USD.
But it didn't count.
Here's what happened:
On a Thursday night, the astounding sale of Punk 9998, left people all over the CT wondering what happened.
The Punk wasn't even a rare one to justify the half-billion-dollar sale.
Was it a money laundering case or an exploit?
No, it was closer to a prank.
The buyer and seller were the same person.
In traditional finance, this is known as a wash-trade, which is a sort of market manipulation used to make an asset appear to be worth more than it actually is.
But how did this person come up with that much money to make the trade?
The funds came through a flash loan, one of the most interesting mechanics, available only on DeFi.
A flash loan is a special type of blockchain transaction that allows you to borrow X amount of money with no collateral.
Win-win scenario right?
Well, you should know that to make this work, you must return the loan within the same transaction block.
Essentially, you must initiate, use, and repay the loan on the Ethereum network in around 15 seconds.
That is how long it generally takes for a transaction to be validated.
A flash loan is like using a time-traveling DeLorean from "Back to the Future" to borrow money.
You can make unlimited profits within the trip but must return the exact amount before it ends.
If not, the timeline resets and all your gains vanish.
Similarly, if you fail to repay within the same transaction in the blockchain realm, everything is reversed, and it's as if the loan never happened.
Flash loans have many uses:
-
Liquidity swaps
-
Collateral swaps
-
Self-liquidation
To sum it up flash loans are an advanced technique, typically used by developers.
However, they have a negative reputation due to their involvement in numerous significant hacks.
Some interesting stories there as well.
Now let's wrap up the Punk 9998 story.
According to @cryptopunksnfts, the bid, while technically valid for a short time, can never be approved.
They also filtered the sales bot to avoid further notifications for these types of transactions.
The owner of Punk 9998, did not profit from the trade.
Moreover, it cost him/her around 800 USD in transaction fees.
Shortly after that, Punk 9998 was offered for sale at the price of 250K Eth, a whole billion USD.
That's a wrap!
Hope you enjoyed the story and learned something because I have some more in the works.
If you need additional resources for the story or flash loans let me know, happy to provide them.
Thank you very much for reading fam鉂わ笍馃獎
I just minted New Era ETH, celebrating the start of @BuildOnBase bringing billions of people onchain.
It鈥檚 Onchain Summer.
Ty God never liked hashtags
Today marks the sixth anniversary of Cryptopunks, the NFT collection that sparked the revolution.
Here's the strange story of Punk 9998.
One of those stories that could only happen in the crypto realm.
In October 2021, the biggest NFT purchase ever took place.
A Cryptopunk sold for over 500 million USD.
But it didn't count.
Here's what happened:
On a Thursday night, the astounding sale of Punk 9998, left people all over the CT wondering what happened.
The Punk wasn't even a rare one to justify the half-billion-dollar sale.
Was it a money laundering case or an exploit?
No, it was closer to a prank.
The buyer and seller were the same person.
In traditional finance, this is known as a wash-trade, which is a sort of market manipulation used to make an asset appear to be worth more than it actually is.
But how did this person come up with that much money to make the trade?
The funds came through a flash loan, one of the most interesting mechanics, available only on DeFi.
A flash loan is a special type of blockchain transaction that allows you to borrow X amount of money with no collateral.
Win-win scenario right?
Well, you should know that to make this work, you must return the loan within the same transaction block.
Essentially, you must initiate, use, and repay the loan on the Ethereum network in around 15 seconds.
That is how long it generally takes for a transaction to be validated.
A flash loan is like using a time-traveling DeLorean from "Back to the Future" to borrow money.
You can make unlimited profits within the trip but must return the exact amount before it ends.
If not, the timeline resets and all your gains vanish.
Similarly, if you fail to repay within the same transaction in the blockchain realm, everything is reversed, and it's as if the loan never happened.
Flash loans have many uses:
-
Liquidity swaps
-
Collateral swaps
-
Self-liquidation
To sum it up flash loans are an advanced technique, typically used by developers.
However, they have a negative reputation due to their involvement in numerous significant hacks.
Some interesting stories there as well.
Now let's wrap up the Punk 9998 story.
According to @cryptopunksnfts, the bid, while technically valid for a short time, can never be approved.
They also filtered the sales bot to avoid further notifications for these types of transactions.
The owner of Punk 9998, did not profit from the trade.
Moreover, it cost him/her around 800 USD in transaction fees.
Shortly after that, Punk 9998 was offered for sale at the price of 250K Eth, a whole billion USD.
That's a wrap!
Hope you enjoyed the story and learned something because I have some more in the works.
If you need additional resources for the story or flash loans let me know, happy to provide them.
Thank you very much for reading fam鉂わ笍馃獎
As it right now it's great imo
Are you trying to manage negative emotions, in a beneficial way?
For example, I am getting angry extremely rarely, and I don't like to express it.
I try to fuse it into more motivation to put in the work for the things I want to achieve.
Does that make sense to you?
I've experienced a strange sense of clarity for the last several days.
So I made a mindmap of everything I want to improve in the near future.
The pages at the top and middle that stand alone are "Physical/Mental Health" and "Networking."
Without them, everything is a castle in the sand.
Life is short and without people is meaningless.
There is also a hidden page, the key to shift from theory to implementation: AI 馃獎