Issue 18 🍵 A surprise Visitor

A Meebits exploit, the Christie's Punk auction, and more.

Disclaimer: This newsletter is not financial advice. We buy what we like, and you should buy what you like.

If you were watching over the weekend, you might have seen this Meebits story (and if you still haven’t caught up on Meebits, there’s a brief summary in Issue 17).

The gist of it is this: @0xNietzsche managed to exploit the Meebits contract.

Remember how each Punk and Glyph NFT are entitled to a random free Meebit? Well, 0xNietzsche managed to reject the contract’s random result 160 times, until it settled on the rare Visitor.

And well, this is crypto! Code is law, the rare Meebit had been pulled out. 0xNietzsche ultimately managed to sell it to renowned NFT flipper Pranksy, and Larva Labs managed to paused their contract before anyone else could abuse it.

All’s well that ends well.

This got us thinking about fees and security, though. Because the Ethereum network, where most NFTs like Punks and Meebits live, has been notoriously expensive lately. We’re talking about a few hundred dollars just to mint a piece of art.

The metaphor that people always say is that Ethereum is Manhattan—it’s where everything happens! But because it’s only so big, it’s not able to facilitate everyone who’s now interested in being in the city.

And it’s old, so you can’t just revamp in a few day without disrupting a lot of major activity! So, other people started building new cities. These faster networks are trying to take some of the traffic from Ethereum, which so far, works very well for financial purposes.

But it doesn’t quite work for art. You can use a bank anywhere, but if you want to buy a premium piece of art or a luxury car, you don’t just buy it off of the street. You go to the trusted galleries and dealers.

And well, most of these new networks haven’t been running for over a year, and it’s hard to trust them with a few hundred thousand dollars parked in an NFT. These chains haven’t been tried and tested; what if a node crashes and suddenly deletes a few NFTs?

(That’s probably not how it works, but you get the point.)

Ultimately, we do hope that things get cheaper, either by upgrading the Ethereum network or these chains grow more robust.

But it is interesting to think about: what if 0xNietzsche was able to spam attack the contract over the course of a few minutes, instead of a few hours? What if each try only cost a few cents? And what if others were quickly able to follow?

Would more successful exploits change the way we view the Meebits project?

Ethereum may be disgustingly expensive, but it also makes it expensive to hack projects. Inadvertent security?

~A Cup hiatus: until June 16th~

Didn’t want to do this after taking a break just a few weeks ago. But despite using “we” in here, it’s really just a “me,” and some personal things have happened. Making money with NFTs and crypto is fun, but it can’t buy time with friends and family.

So, I will be spending the next few weeks doing just that. Don’t forget to get your vaccines and stay safe out there, y’all.

Other news

👽 The Christie’s Punk auction settled for $16.7M (after buyer’s fees, it puts the total lot to about $14M). There’s some discontent around how it was handled—the rare Alien should have been separated!—so keep an eye out for discussions on Twitter.

🛒 It’s confirmed now: Ebay is really going to allow NFTs to be traded on their platform! Gonna be interesting to see how they implement it.

👀 An upcoming new platform: LGND. It’s on the WAX blockchain, and it caught our eye because they actually have a pretty good roster of artists. They’re also heavily marketing with the “clean NFT” angle, and it’s interesting how that is such a selling point for artists.

Reading list

  • Packy McCormick wrote this great piece about the Great Internet Game. This is all just a game, and it’s especially relevant for cryptocurrencies—tokens are just an in-game currency! Here’s the quote on NFTs:

If people want to buy skins in Fortnite to express themselves, or clothes in meatspace to do the same, of course they’d want to buy NFTs to express themselves online. In an open world like the internet, the more you signal who you are and what you care about, the more you open yourself up to new possibilities. It’s an abundant game. NFTs are online art, cars, outfits, and houses. They’re the digital trappings of digital wealth. 

Creative corner: PUNKS Comic

The mechanics of the CryptoPunks comic has been pretty fascinating, so we’re sharing it today.

You buy one of 10,000 NFTs, which comes with a physical comic.

But, you can also stake them to get fractional shares in a vault of Punks, or burn the NFT altogether to get an exclusive token backed by the Founders Vault.

A NFT that can entitle you to a vault of other NFTs is pretty interesting, no?

If you wanna dig deeper, check out PUNKS Comic on their website.

Try this: donate to a mint fund!

This week’s prompt is pretty inspired by this tweet.

First mint funds give a grant to artists who can’t afford to mint otherwise. It’s a lovely initiative, and they also end up curating some cool talent too!

Some examples include the Sevens Foundation, the Mint Fund, and First Mint Fund!

🍵 See you again in June.