OpenSea is currently the most popular platform for buying NFTs, with $3.4 billion in transaction volume in August alone. However, when something goes wrong with the platform itself, it can have major ramifications for owners of crypto collectibles, as several OpenSea users discovered yesterday, resulting in estimated losses of roughly $100,000.
On Tuesday, Nick Johnson, the principal developer of the Ethereum Name Service (ENS), tweeted that a “bug added to [OpenSea’s] transfer page in the past 24 hours” accidentally burned (i.e. destroyed) NFTs that users sought to transfer to an Ethereum wallet using an ENS name.
An NFT functions as a deed of ownership for a valuable digital asset, such as photos, video clips, interactive video game elements, and much more. Many NFT collectors utilise ENS names to make moving digital assets to an Ethereum wallet address (a long string of letters and numbers) easier, as well as to build a brand around their collection.
Johnson personally lost an NFT as a result of the problem, but he is not alone: according to data he compiled, collectors lost at least 42 NFTs in total. According to an estimate of the floor price—or the cheapest NFT posted for sale—for each collection, a minimum of 28.44 ETH worth of NFTs were lost, or over $99,000 at the time of writing.
He discovered the problem while transferring rilxxlir.eth, the first ENS name ever registered. Johnson attempted to transfer the NFT representing the ENS name into his own wallet (nick.eth), but OpenSea instead transmitted the NFT to the wrong wallet address. He said that OpenSea’s interface failed to resolve the ENS name associated with his wallet, instead “instead [populating] the ‘to’ address with some nonsense.”
In other words, the NFT was ejected into space. Because blockchain networks are immutable, the NFT representing the ENS name appears to be gone forever and cannot be transferred back to him. “Rilxxlir.eth ownership is now forever burned,” he tweeted.
Some of the other impacted individuals have also tweeted about the matter, requesting a reaction and compensation from OpenSea. As of the time of writing, OpenSea had not publicly commented on the incident. Johnson stated on Twitter that the market is “still writing a postmortem” on the issue.