OpenSea platform compensated users almost $2 million in losses

The service had a malfunction that allowed the purchase of non-interchangeable tokens at an undervalued price
OpenSea platform compensated users almost $2 million in losses

The NFT OpenSea platform reimbursed users for a total of 750 ETH ($1.9 million, as of the morning of Jan. 31), Bloomberg writes. The project first reported a malfunction that allowed high-value tokens to be bought at an undervalue, the platform’s founder said last December 31.

Before the urgent listing feature (tokens are automatically removed from the platform after a certain time), users had to delist their NFTs themselves. This required the payment of additional fees, which in some cases were extremely high.

However, when a token was transferred to a third-party wallet and back, it was no longer displayed in the Marketplace interface. However, the delisting was not confirmed in the blockchain, so NFT could still be purchased through the API. This allowed you to buy tokens at the old prices, which were often much lower than the actual prices.

To fix the problem, OpenSea launched a review and cancellation feature for listings, and reduced the default duration of NFT listings from six months to one month. All users have also been notified to delist.

The company stressed that it was actively engaging with those affected and compensating them for their losses. Collector Robert Garcia told Bloomberg that the company reimbursed him 13.8 ETH after his NFT was sold at an undervalued 4.7 ETH.

Last week, an unidentified OpenSea user under the alias jpegdegenlove earned 347 ETH using an OpenSea vulnerability. He bought the tokens well below their market value and resold them at the current price.

In early 2022, OpenSea raised $300 million in investments from Paradigm and Coatue. After that, the valuation of the marketplace exceeded $13.3 billion. The platform will use the funds raised to create new products, hire employees and improve the user experience.

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The post was written by Crypto Expert John Belford

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