Did a CryptoPunks NFT on Ethereum really sell for a record $56.3 million as the broader NFT market continues its long, slow decline? No. Here’s why.
While it’s true that CryptoPunk 1563 was transacted this afternoon, and that 24,000 ETH—or $56.3 million worth at the time—was “paid” for the asset, there were both surface-level and behind-the-scenes red flags that quickly cast doubt on the legitimacy of the purchase.
First off, this particular CryptoPunk was last purchased for about $69,000 worth of ETH in September. It doesn’t have any particularly rare attributes, which means it typically sells near the entry-level (or floor) price for the collection. It’s a “floor Punk.” There’s no obvious reason why it would jump in value by 81,000% in a matter of weeks.
A look at on-chain data shows that the purchase was conducted via crafty use of flash loans, aka uncollateralized crypto loans that must be paid back in the same…
