Some thought the transaction was a “fat finger” error, but links to Tornado Cash might suggest otherwise.
The NFT market has slumped this year. While transactions in excess of $1 million were common in the bull run of 2021, they are rare today. (In fact, 95% of collections have lost value.)
Yesterday however, eagle-eyed users spotted that a CrypToadz NFT, an Ethereum-based token, sold for a whopping $1,660,000 (1,055 ETH), despite having a floor price of just $750 (0.5 ETH).
CrypToadz are a collection 6969 amphibious creatures created by digital artist Gremplin. The collection currently has a trading volume of $122,202,814 (76,890 ETH) on OpenSea.
The rogue transaction spent $41,500 in fees to OpenSea, initially leading some to speculate it was a “fat-finger error”.
Such errors are not uncommon: last month, Paxos overpaid $512,000 on a single $2000 Bitcoin (BTC) transaction due to a bug. The funds were returned from the miner back to Paxos within a week.
Read more: Paxos confirms it mistakenly paid $512K on $2K Bitcoin transaction, here’s how that happened
Further community input however suggests that the CrypToadz transaction was not an error, but a wash trade, namely due to its connection to Tornado Cash.
Tornado Cash is a cryptocurrency mixer that obscures the transaction trail from the fund’s original source. The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned the platform last year, after it was found to have laundered billions in illicit funds.
Crypto Twitter pointed out that the wallet which purchased the CrypToadz NFT was funded by a wallet that has been pulling money out of Tornado Cash. The wallet was funded with around $1.9 million in September.
Tornado Cash isn’t always linked to laundering, but it often is.
The original author of the tweet, NFTstats.eth, also concluded that the transaction was likely a wash trade, stating, “On further look, it looks like a good chance this was a wash trade. If so, perhaps the blip was not realizing there is now a marketplace fee on OS.”
Despite OpenSea raking in $41,000 in fees, no royalties were paid to the creator, since OpenSea stopped enforcing them.
Disclaimer: CryptoPlug does not recommend that any cryptocurrency should be bought, sold, or held by you. Do conduct your own due diligence and consult your financial advisor before making any investment decisions.
