Home » Coachella NFTs Sold for $1.5M—Now They’re Stuck on FTX

Coachella NFTs Sold for $1.5M—Now They’re Stuck on FTX

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in a nutshell

  • FTX NFTs users have said they will not be able to withdraw their assets from the platform after the company filed for bankruptcy.
  • Coachella’s innovation lead said the concert festival is “actively working on solutions” to help affected NFT owners.

FTX customers around the world have been frozen after cryptocurrency exchange assets were frozen. Last week’s sudden collapse, apparently worth billions of dollars in total.And it’s a cryptocurrency DeFi one of the tokens — some users have NFTs Also stuck in FTX.

The Discord server associated with the project launched last year via the FTX NFTs platform is currently filled with complaints from users unable to withdraw. Solana– Base assets from your FTX account wallet.

In some cases, even people who have transferred NFTs to an external self-custody wallet may not see the NFT artwork due to obvious FTX server issues. Links to many projects launched through the FTX NFTs Marketplace are broken as well. FTX announced on Friday that it had Filing for Chapter 11 Bankruptcy Protection.

Affected projects include major music and sports brands, including concert festivals. Coachella When Tomorrowland, NBA star Stephen Curry2974 NFT collection, as well as Formula One themed NFTs Mercedes AMG Petronas racing team.

Coachella Announcing partnership with FTX US In February, the company’s plan to release 10 Lifetime Festival Passes as NFTs was hailed as a step forward into the mainstream. Web3 Not to mention the real-world utility of such digital assets.

In addition to the pass, various NFT goods were released at this festival. billboardIt first reported problems with NFTs on Tuesday.

However, users on Coachella’s Discord server are currently reporting that they are unable to transfer purchased NFTs from their FTX wallets. Some say the Coachella NFT, which is kept in a self-contained purse, doesn’t show any artwork. Discord moderators say it’s because FTX’s servers, which hosted the artwork associated with the NFT, are down.

“We currently do not have a means of contacting the FTX team,” wrote a Coachella server administrator on Friday. “We assembled an internal team to come up with a solution based on the tools we had access to. Our priority is to get the Coachella NFT from his FTX, which now appears to be disabled. is.”

In a statement to Decryption Coachella Innovation Lead Sam Schoonover confirmed today that the festival is working to develop a response for NFT holders. “We are actively working on a solution and we are confident he at Coachella can protect the interests of NFT owners,” he wrote.

custody concerns

Unlike many NFT marketplaces, FTX NFTs were a custodial platform— This meant that buyers kept their purchased NFTs unless they chose to transfer them to an external wallet. And given that FTX’s partners are major mainstream brands, it likely served more casual buyers who didn’t mind transferring their assets to self-custody wallets.

Anyone seeking to sell another supported NFT from Solana or through the marketplace in addition to the assets originally sold through the FTX NFTs platform ethereum— You have to give FTX custody first.

metaplexCEO Stephen Hess, creator of Solana’s NFT protocol, said: Decryption This situation presents the risks associated with a centralized custody market, as users currently have no way to access assets purchased on the platform.

“Unfortunately, FTX has always operated a centralized NFT marketplace, so any Metaplex NFT that was not withdrawn prior to the platform’s demise could be caught in the ongoing bankruptcy process for years,” Hess said. says. “I hope this serves as a wake-up call to his NFT collectors and creators that escrow-based marketplaces pose significant risks.”

Solana’s largest NFT marketplace, Magic Eden, also uses an escrow-based model. Despite the platform’s popularity, It also faces criticism for potential problems You will have to face attacks and future bankruptcies. Hess believes that developing decentralized marketplaces such as Metaplex’s own Auction House using his protocol would be a better fit for developers.

“With an auction house, users can continue to store their NFTs and withdraw their listings on-chain, even if the marketplace collapses,” he added.

Whether Coachella and other FTX NFT partners can regain control of the project remains to be seen. Hess said that if the creator retains the ability to change the metadata (i.e., the data that specifies the NFT’s functionality), he can “revoke his original NFT that is stacked in FTX and create a new token.” It states that there is a possibility that it can be reissued as But all of that remains unknown for now.

“It may take some time.”

FTX NFT users are part of a growing customer base with potentially valuable digital assets trapped throughout the FTX ecosystem. Top 1 million creditorsAs suggested by Hess, the bankruptcy process can go on for quite some time.

Decryption We reached out to FTX representatives regarding the NFT issue and whether users would be able to access assets on the platform, but did not hear back immediately.

“Did you lose $500?” user “baller4adollar” asked in a room dedicated to Steph Curry’s 2974 NFT project on the official FTXLand Discord server. but others seem to have given up on their fate that there may not be a solution in the near future.

“My friend, let’s take it easy here. [a] lots of people [are] There is no reason to turn against each other as we deal with difficult times,” user ‘outlawtorn.eth’ wrote on the 2974 channel. “We will stay strong and find a way forward, but it may take time.”

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