Morning Minute | Two NFT Exploits Kill Momentum on ETH

TylerD's Market Summary

Hackers ruined what was a fun weekend with SOL phones exploding in interest, BTC Ordinals popping and memecoins running. Find out what happened and its impact.

📉 NFT Weekend Recap

This was a dark weekend for the Ethereum NFT market.

We woke up to panic on the timeline Saturday morning as an exploit was happening in real-time, tied to the NFT Trader platform.

And then just hours later, another exploit broke out tied to the Flooring Protocol.

Millions of dollars in grail NFTs (Bored Apes, Pudgy Penguins, and more) were lost.

It was a terrible situation, but some positive has come out of it.

For a quick summary of the NFT Trader exploit:

The NFT Trader exploit was tied to permissions that many previous users of the platform never revoked, allowing hackers to transfer the assets (even if on Ledger devices).

0xFoobar and 0xf4d3 (a 16-year-old prodigy) figured out a code fix to stop the hack within a few hours.

Then 0xQuit and his Boring Security got all 36 BAYC and 18 MAYC in the primary hacker's possession back.

So many holders will be made whole from this exploit.

It's unclear regarding the Flooring Protocol exploit.

Free Lunch Capital (the anonymous founder of Flooring) has promised compensation from his share of Flooring, spending on auditing and bug bounty and continuing to build the protocol.

There are some big open questions right now as to who will continue to use it.

But seeing the victims compensated would certainly be a great first step.

As for the market impact, volume dropped considerably and most leaders were red.

The Saturday trading volume was the lowest day since the Blur airdrop on Nov 23, and most leaders fell 3-5%, now down 9-20% on the week (see below for full detail).

It feels like all the wind has been taken out of the ETH NFT market's sails.

And now with eroded confidence in protocols and with $800M+ locked in Blast, it's hard to see the near-term catalysts to turn things around.

But there were a few positive stories from the weekend

Bitcoin Frogs Pass $20k

Bitcoin led all blockchains in "NFT" trading volume on CryptoSlam this weekend, mostly on the back of BRC-20 trading.

But one NFT collection did benefit from the volume.

Bitcoin Frogs.

The Frogs soared from 0.14 BTC to a 0.46 BTC floor early Sunday morning ($19,250 or 8.7 ETH) before settling at 0.35. 

That makes them the 4th highest PFP by floor price for a 10k collection, behind just Punks, Apes and Penguins.

They weren't alone in their pump. According to NFT Stats, 3 other project saw major gains:

• BTC Punks: 0.03 --> 0.056
• Ordinal Maxi Biz: 0.39 --> 0.57
• Goosinals: 0.02 --> 0.04

Given frustrations on ETH right now, BTC is set up well to see more volume and interest.

As is another blockchain...

SOL Phone 3x's

The Solana Saga phone caught headlines last week when $BONK soared past a $1B marketcap.

Why? Because the phone comes with 30M BONK, meaning the BONK was worth more than the $600 phone.

But the fun didn't stop at the sellout. 

The Saga phones have been selling like hotcakes on Ebay, with dozens of sales between $2k-$3k (a quick 3-4x for buyers).

It's not just the BONK causing this action. Teams are lining up to reward Saga holders with airdrops and mint opportunities.

Teams that have already mentioned potential airdrops for Saga holders include $MYRO, $GECKO, $SAME, $SHDW and the Solend Protocol.

That's on top of BONK and the Clayno mint opportunity for early buyers.

Those opportunities have effectively turned the Saga phone into a 20k utility NFT collection. And it seems the opportunities are just getting started.

Overworld Makes It Right

The Overworld team faced some serious fud on Friday after its mint was over-allocated and heavily botted.

It seemed the goodwill they had built up pre-mint had been lost. Sentiment was shifting.

Then co-founder Jeremy Horn stepped in and fixed everything.

He shared a detailed post admitting to mistakes and how they'd make it right, including:

• Rewards for those who tried but failed to mint
• Future benefits for everyone on the whitelist
• A bonus claim for holders and early buyers
• Using future treasury to reward the community

This was enough to calm some concerns and sent the Overworld floor up about 30% to 2 ETH.

Now we'll see if the sentiment sustains.

NFT Market Overview

Now for a quick look at broader price action.

Here is a quick rundown of the notable floors (on ETH) and their 7-day price changes:

• Fidenza: 63.77 ETH (-4%)
• CryptoPunks: 54 ETH (-3%)
• Ringers: 33.5 ETH (even)
• BAYC: 26.45 ETH (-10%)
• Gazers: 10.49 ETH (-3%)
• Pudgy Penguins: 9.26 ETH (-15%)
• Grifters: 9.6 ETH (-7%)
• Chromie Squiggle: 8.99 ETH (-5%)
• Winds of Yawanawa: 7.5 ETH (-6%)
• Azuki: 5.65 ETH (-12%)
• MAYC: 5.08 ETH (-11%)
• Captainz: 4.45 ETH (-11%)
• Otherside Koda: 3.95 ETH (+11%)
• DeGods: 2.66 (-16%)
• Milady: 2.64 ETH (-17%)
• PROOF: 2.35 ETH (-30%)

So it was a very red week with leaders down 5-15%.

The top end held up the strongest, with Kodas the only real green set after a Beanie-inspired pump.

The PROOF pass fell the hardest, down 30% and in danger of being removed from this tracker entirely.

The 2 week post-Blur airdrop pump seems to have diminished, and after this weekend's exploits, it's hard to see the near-term rally scenario (except maybe a surprise airdrop).

But for right now, it looks like ETH NFTs may see a red Christmas...

🚚 What else is happening in NFTs?

Here is the list of other notable headlines from the weekend in NFTs:

• ETH trading volume came in at $18.5M on Sunday, $11M less than last Sunday; NFT leaders mostly saw red
• Blips, Keepers and Seedworld led top movers on ETH, each up in the 50% range on the day
• Gordon Goner bought his first SOL NFT in a Bodoggos late Sunday, leading to a 120% spike in the Dog floor to 15.8 SOL (they became 3rd highest traded project by volume as well)
• Solana NFTs flipped ETH in trading volume with Tensor flipping Blur for the firs time; SOL leaders saw soft green with Mad Lads at 207 SOL floor and Tensorians at 109
• PROOF Grails V revealed on Sunday, featuring artists Botto, 0xTjo, Martin Grasser, Dave Krugman and more; see the full reveal here
• A new XCOPY DAO formed called Doomed DAO, with intent to build an XCOPY portfolio, attract and engage X fans, and promote his legacy
• Legends of the Mara introduced Kodamara Fusion, a new feature allowing players to evolve their Mara using unique Creation Season Catalysts
• Oracle Red Bull Racing is launching "Oracle Red Bull Racing Champions Collection 2023," free digital collectibles on the Sui blockchain via Bybit.

🌎 Around Crypto and Web3

A few other Crypto and Web3 headlines that caught my eye:

• Crypto majors fell hard on the day; BTC -2.3% at $40,890; ETH -4% at $2,130; SOL -5.6% at $68.60
• BONK fell 10% on the day to a $1.1B market cap, now down 40% from local high after the Coinbase listing
• Leading memecoins had a great weekend, with COQ (Avax) hitting $150M, NINJA (INJ) reaching $20M and NOLA ($5M); WIF also broke $100M on SOL
• Solana flipped ETH in DEX volume for the first time in its history this weekend, $1.47B to $1.16B
• NFTperp announced a $3M raise led by 1kx to build out the next version of its NFT future protocol

🚀 NFT Total Volume (ETH)

• MAYC (1,017 ETH, 5.08 ETH Floor)
• Azuki (876 ETH, 5.65 ETH)
• BAYC (655 ETH, 25.97 ETH)
• DeGods (624 ETH, 2.66 ETH)
• Matr1x Kuku (552 ETH, 3.08 ETH)

📈 NFT Floor Price Increase (ETH)

• Blips (57%, 0.22 ETH Floor)
• Keepers v2 (54%, 0.14 ETH)
• Seedworld Vanguards (50%, 0.57 ETH)
• Kokodi (34%, 0.12 ETH)
• Ether Avatars (25%, 0.19 ETH)

🗓 Upcoming NFT Mints and Reveals

Today has several drops but mostly from lesser known artists.

With a lack of highlights, Courtyard's partnership with OpenSea may be the highlight.

Expect a slower couple weeks as the holiday season ramps up, but we'll call out the major exceptions here.

See the full list and dive in for more details with Swizzy's daily mint monitor. 

• Memes by 6529 (11:00 a.m. ET)
• Courtyard x OpenSea - Holiday Box (1:00 p.m. ET)
• young wknd - Track Waves (6:30 p.m. ET)

Enjoy this write-up and/or want to sponsor the Morning Minute? Follow along with me on Twitter @tyler_did_it or reach out via email tyler.warner@luckytrader.com.