CryptoPunks NFT was recently valued at +$1.5M but sold for just $23K

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Over the past few weeks, CryptoPunks’ non-fungible token collection has seen a surge in trading volume, with some rare tiers selling for millions of dollars. But surprisingly, the CryptoPunks NFT collection that recently recorded a record high bid of 600 ETH was sold for just 10 ETH. In this article, we take a closer look at what’s going on with this NFT.

Punk #2386 Worth $1.5 Million Sold for Just $23,000

According to data collected by Etherscan.io, a popular on-chain block explorer and analytics platform for the Ethereum blockchain, the CryptoPunks #2386 NFT collection sold for 10 ETH a few hours ago, worth around $23,000. The sale of this collectible surprised many, as the same CryptoPunks NFT collection had recorded a high bid of 600 ETH a few hours earlier.

Punk 2386 has a new bid of 600 ETH (1,405,818.02 USD) from 0xb9eb79. https://t.co/1g0pmuZFkD #cryptopunk #Ethereum pic.twitter.com/3A629r0EP0
— CryptoPunks Bot (@cryptopunksbot) September 11, 2024

Launched around June 2017, CryptoPunks is a non-fungible token collection previously launched by digital asset incubator Larva Labs. The CryptoPunks NFT collection is a limited edition of 10,000 pixelated profile pictures hosted exclusively on the Ethereum blockchain network. Over the past two years, the NFT collection has been well-managed by Yuga Labs, who also developed the Bored Apes Yacht Club and Mutant Ape Yacht Club NFT collections.

CryptoPunks have seen a surge in sales over the past few weeks, with some of the rarest tiers fetching millions of dollars. Some of the recent Punks that have sold for huge sums include Punk #6915, which sold for over $1.4 million and then resold for over $1.5 million last week. Punk #9368 sold for $1.2 million last week, and there are many more.

A $1.5 million punk album sold for just $23,000. What went wrong?

In a September 12 blog post, Quit, a prominent cryptocurrency and NFT market investor, used jpeg dealer, solidity developer, and auditor, shared some insight into what may have been behind the recent decline in sales of the Punk #2386 NFT collection. According to Quit, the Punk was split into 10,000 ERC-20 tokens on September 9, 2020, which were distributed to 257 holders.

Punk 2386, whose current highest bid is 600 ETH, sold for 10 ETH today.
A clever detective job and an unfortunate math mistake landed 0x282 a seven-figure salary.
🧵 pic.twitter.com/E29DLQZ0GT
— End (@0xEnd) September 11, 2024

CryptoPunks #2386 split took place on a now defunct platform called Niftex, and this contract lasts forever. The setup is that any shareholder can propose a “shotgun”, meaning any shareholder can propose a buy price, and if no one objects, they can buy the asset after 14 days. In the latest episode, 0x282, the new holder initiated the shotgun on August 28, 2024 (14 days ago).

Some shareholders took notice at the time, and at least two shareholders tried to refute the new bid. One shareholder immediately postponed, thinking that there was more time, while another shareholder tried to block the bid. As defined in the shotgun contract, a shareholder must purchase the offeror’s shares at a price higher than the offer price to block the proposed purchase.

The new Punk #2386 owner initially proposed a price of 0.001 ETH per share (10 ETH for every share). In this case, the shareholder should have been 0.0010000001. Gmoney, one of the shareholders who tried to block the purchase, counterclaimed for 0.000001 ETH (1000000000000 wei), which was just short of the requirement. Since no one could block the shotgun, 0x282 walked away with the Punk NFT collection.