Another $34 Million in ETH Burned... Thanks For The Deflation! — #16
Another $34 Million in ETH Burned... Thanks For The Deflation! — #16
Before writing this week’s newsletter, I was stuck between a rock and a hard spot. Yes, the Moonbirds’ great mooning was the talk of the week, but then again I figured you would be tired of hearing the same old, same old. Luckily, something rather interesting popped up… a $34 million smart contract lockup, forever?
Welcome back to ART HAUS WKLY, where we summarize the major crypto and NFT happenings for the week. If you haven’t done so already, do check out our Twitter for regular updates on what’s poppin’ in the Haus. If you’re enjoying our weekly content, feel free to subscribe so you never miss out on another unit.
And now that that’s out of the way, let’s get onto some long-awaited updates.
Gnarly Business
This week at Gnars-Haus seems to have been pretty stagnant, but trust me, Gnarly business is working behind the scenes!
Just a friendly reminder, Nouns DAO Prop 51 was passed two weeks ago, which means Gnars now has an extra 69 ETH at its disposal. Our treasury currently stands at approximately 73.5 ETH, all funds going towards Shredding the Gnars (and Nouns)!
Gami also posted an amazing thread encompassing what Gnars is, and why we are working towards being the “Red bull of web3”.
Ambitious? Of course. Here’s a one-page write-up of our vision.
And finally, do check out our Gnarly Discord for exclusive updates; such as BTS developments in the Haus. Come on in, it’s free!
Below is one such sneak peek into Gnarnia…
And now, let’s get onto the recent smart contract lockup.
News Of The Week: Akutar’s Bugged Smart Contract Locks Up $34 Million, Forever
Akutar, a very recently dropped NFT collection that had substantial hype, but ultimately turned into a nightmare due to poor code in their smart contract.
So everyone keeps talking about $34 million in ETH locked forever. How did that even happen? And as it stands, would this amount ever be able to be recovered?
Here’s a non-technical breakdown of the Akutar situation.
The Exploit
Akutar decided to launch their NFT project in a novel manner - a Dutch auction starting at 3.5ETH. A Dutch auction is a bidding system in which the price of NFTs is systematically lowered at every chosen interval (every few hours), until the collection is eventually sold out, or reaches the minimum price.
This has worked great for quite a few other projects, but Akutar took a spin on the concept. Those who minted earlier (at 3.5 ETH), would be refunded the difference between that and the NFTs final resting price.
And that is where the first exploit happened.
The attack on Akutar’s smart contract was a griefing on its code. This means that while the attacker didn’t gain anything from exploiting the smart contract, it still came at the expense of others; in this case, not being able to get refunded.
Coming out as one without ill-intent, the situation was cleared after a while with the AkuDreams team (devs behind Akutar) coming out and admitting their errors, and the attacker subsequently removed the block.
So now, everything’s back to normal. Everyone makes mistakes, and everything is solved now… so we good?
Crisis Averted, Then Disaster Strikes
Having the smart contract exploited would be human error, but having the smart contract fail twice would be human negligence. In this case, it seems like the AkuDreams devs have been negligent.
It turns out that the smart contract had another error - also concerning the bidding and withdrawal process.
In non-technical terms, the contract was programmed to track the number of bids on the NFTs, as well as the number of requested refunds/withdrawals. The total requested refunds would never be allowed to exceed the total number of bids.
However, the team had not accounted for the multi-bidding of NFTs in the same transaction. As a result, there were nearly 2000 legitimate requests for refunds over the total number of bids… and hence these withdrawals could never be processed.
Crucial Takeaways
What can we learn from this Akutars smart contract oversight?
Competent devs and open-source contract auditing. There are tons of capable ethical hackers in the space, who would gladly help the AkuDreams devs out with any issues they face.
In fact, Twitter user Hasan tried to warn the team of this exploit, but was treated as FUD earlier. We really got to start treating criticism more seriously, and not dismiss something as FUD just because it paints an ugly picture of a project.
For a technical breakdown of this matter, Twitter user 0xInuarashi does a great job with it. Do check it out!
News Daily
18.04.2022
Remember the $600 million+ exploit of Axie’s Ronin Bridge? Well, it seems like US authorities have narrowed the suspected culprits down to an infamous North Korean hacker group, Lazarus.
More info on what the current stance is in the piece below.
US Treasury Identify Culprits Behind Ronin Bridge Breach
19.04.2022
Azuki is a PFP NFT collection of anime-inspired artwork. After bursting into popularity a few weeks back, its sidekick collection Azuki BEANZ has been at the center of attention as well. Perhaps, they’re finally ready to discuss more details about the BEANZ?
More details on the BEANZ in the article below.
Azuki NFT Finally Announces The Details Of BEANZ NFT Collection
20.04.2022
Coinbase NFT Beta has arrived! A hyped NFT marketplace that cryptocurrency exchange Coinbase is setting up, the organization has said that their marketplace will be one like no other.
And oh well, their waitlist to enter the marketplace is insanely lengthy! More details about the Coinbase NFT Beta below.
Coinbase NFT Officially Launches Marketplace Beta
21.04.2022
Justin Sun, the founder of cryptocurrency network TRON, has announced that they would be introducing a new stablecoin USDD, backed by $10 billion worth of crypto. The stablecoin is “algorithmic”, think Terra’s UST to draw a comparison.
It will be interesting to see how USDD turns out. Will it keep 1:1 peg?
Justin Sun to launch algorithmic stablecoin USDD on Tron, will use $10 billion of crypto as collateral
22.04.2022
Zachxbt, well-known on-chain sleuth on Twitter, has found the people behind yet another high-profile NFT rugpull. Project Shura, an anime-style NFT collection riding the hype of fellow project Azuki, was rugged by the devs who ran away with $1.7 million in Ether.
In the piece below, you’ll find out how Zachxbt found the culprits.
Zackxbt Reveals Details in a $1.7M Rug Pull Involving Project Shura
23.04.2022
RTFKT, a sneakers-based NFT studio purchased by Nike, has just revealed the MNLTH collection, as airdropped to CloneX and PodX holders a while back. While the floor price of these NFTs has been volatile (because of some paperhands selling at a loss), it’s not too shabby for a free airdrop!
More details on this collection below.
Everything You Need To Know About RTFKT MNLTH NFT Sneakers
24.04.2022
New York Senator Kevin Thomas has recently pushed for a new bill in parliament: criminalizing crypto and NFT rug pulls. His bill outlines a clear legal framework that policymakers will be able to follow and tackle these crypto scams effectively… honestly something we absolutely need in the crypto space right now.
More details in the piece below.
NY Sen. Thomas proposes to criminalize rug pulls and other crypto frauds
Art Haus Blog Releases
Last week, I wrote about the top 10 Solana NFT projects, and why you should invest in each of them. This week, we’re working with a continuation of that - Solana NFT tools for trading.
Solana NFT Tools Every Trader Must Have (For Free!)
In this article, we cover a host of Solana NFT tools that will help you analyze NFT collections, in real-time! The best thing is that these tools are all free… yet surprisingly effective in fulfilling your trading needs.
For budding traders in the Solana NFT space, this piece would be extra helpful for you!
Podcasts: Worth A Listen
pr1s0n.art — Restoring Justice And The Dignity of Returning Citizens
Abe Uccello, founder of pr1s0n.art, joins the Digitally Rare podcast. pris0n.art is a non-profit initiative that helps lessen the financial burden on ex-prisoners who have just finished their sentence.
The non-profit banks on creating NFTs out of these ex-convicts’ personal art and documentation of their lives. It’s interesting to listen in on the unique journey of their isolation from the world, and the restorative journey of ex-prisoners.
Do hop onto this episode if you’re interested to find out how you can be a part of this initiative!
Daniel Arsham - How NFTs Can Evolve Your Artwork
Daniel Arsham joins Gmoney on the Cutting Edge podcast for this episode. He is an artist, working in architecture and performance, among others. With works featured in renowned museums and having collaborated with brands like Pokemon and Apple, Daniel talks about why artists should join the NFT space.
In this podcast, they discuss Daniel’s background in art, as well as how he views artwork as a business. From there, they talk about his entry into the NFT space, along with community-building, as well as lots of NFT-related advice, especially for artists!
For an insightful take from an artist’s POV, I highly recommend listening to this episode.
Tyler Reynolds: Reminiscences of a Crypto Cowboy 🤠
In this interesting episode of the Delphi Podcast, veteran Tyler Reynolds joins the cast. He is known as the cowboy CryptoPunk, dabbling in the crypto space ever since the wee days of 2013. After playing out the DeFi summer, Tyler is still here and more focused on angel investing.
They discuss Tyler’s introduction to crypto, his thoughts on Bitcoin maxis, and how the DeFi summer period played out. From there, the Cowboy goes into a variety of topics, such as regulations in the crypto market, value creation vs capture, and the role of DAOs in this community.
This 2-hour-long episode is truly packed with tons of insights from a veteran with nearly a decade of crypto experience… do listen in if you have the time!
Wrap Up
That’s it for this week’s edition of ART HAUS WKLY, hoped you enjoyed it! This has been a slightly longer post due to the more comprehensive write-up of the Akutar smart contract oversight… hope it was worth it though.
And if there’s nothing else, stay Gnarly! More updates soon…
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