Crypto News Roundup: August 19, 2023 📰

Welcome to Crypto News Roundup, where I bring you the latest and most exciting developments in the crypto space. Today, I have four stories that you don’t want to miss:

OpenSea Faces Backlash Over NFT Royalties Change 🥶

OpenSea, the largest NFT marketplace, has announced that it will stop enforcing creator royalties on secondary sales for new collections starting from August 31. This means that sellers will have the option to pay the original artist a percentage of the sale price or not. The decision has sparked outrage among many NFT creators and collectors, who see royalties as a way to reward and support artists for their work.

One of the most vocal critics of OpenSea’s policy change is Mark Cuban, the billionaire owner of the Dallas Mavericks and an investor in OpenSea. He tweeted:

Not collecting and paying royalties on NFT sales is a HUGE mistake by OpenSea. It diminished trust in the platform and hurts the industry. And I say this as an OpenSea investor.

Another prominent NFT project that expressed its dissatisfaction with OpenSea is Yuga Labs, the creator of Bored Ape Yacht Club (BAYC), one of the most popular and valuable NFT collections. Yuga Labs announced that it will begin the process of sunsetting its compatibility with OpenSea and look for alternative platforms that respect creator royalties. The tweet reads:

Yuga Labs will begin the process of sunsetting support for OpenSea’s SeaPort for all upgradable contracts and any new collections, with the aim of this being complete in February 2024 in tandem with OpenSea’s approach. For as much as NFTs have been about users truly owning their digital assets, they’ve also been about empowering creators. Yuga believes in protecting creator royalties so creators are properly compensated for their work.

OpenSea’s CEO Devin Finzer defended the decision, saying that it was necessary to align resources with the most promising efforts and to empower innovation beyond a single use case or business model. He also hinted that OpenSea will introduce new features and tools to help creators monetize their work in different ways.

However, many in the NFT community are not convinced by Finzer’s explanation and view OpenSea’s move as a betrayal of the core values of Web3 and NFTs. Some have even called for a boycott of OpenSea or a migration to other NFT marketplaces that respect creator royalties.

Exactly Protocol Suffers $12M Bridge Exploit ❗️

Exactly Protocol, a decentralized lending platform based on Optimism, a layer-2 scaling solution for Ethereum, has been hit by a security breach that resulted in the loss of approximately 7,160 ether (worth $12.04 million at the time of writing). The exploit involved a cross-chain bridge that allows users to transfer assets between Ethereum and Optimism.

According to blockchain security firm PeckShield, the attacker used an exploiter contract on Ethereum that transferred deposits to Optimism before ultimately bridging stolen funds back to Ethereum. The attack was detected and confirmed by De.Fi Web3 antivirus, a decentralized security platform.

Exactly Protocol announced that it had temporarily paused its protocol after the attack, but assured users that they could still withdraw their assets. The team also said that it was investigating the incident and working on a post-mortem report.
The price of Exactly Protocol’s native governance token (EXA) dropped by more than 12% following the exploit, according to CoinGecko.

This is not the first time that a cross-chain bridge has been exploited in the DeFi space. In July, ThorChain suffered two major attacks that resulted in the loss of over $13 million worth of crypto assets. In June, Poly Network was hacked for over $600 million worth of various tokens, although most of the funds were later returned by the hacker.

OpenSea Drops Support for BNB Smart Chain ❌

OpenSea, the largest NFT marketplace, has reportedly dropped support for NFTs built on BNB Smart Chain (BSC), a layer-1 blockchain that is compatible with Ethereum Virtual Machine (EVM) and claims to offer fast and cheap transactions. OpenSea stated that the decision to remove BSC was due to the "need to align resources with the most promising efforts.”

OpenSea also tweeted:

Starting today, you will no longer be able to create new listings for or make new offers on BSC NFTs. However, you will still be able to view, discover, and transfer BSC NFTs on our site. We’re confident this decision will help us direct resources to keep pace with the rapid innovation in our ecosystem.

OpenSea had initially integrated BSC in August 2022, along with other blockchains such as Polygon, Klaytn, Solana, Arbitrum, Optimism, Avalanche, Zora, and Base. However, it seems that OpenSea has decided to focus on other layer-2 solutions that offer better scalability and security for Ethereum-based NFTs.

The move by OpenSea has disappointed some BSC NFT projects and users, who were hoping to leverage OpenSea’s large user base and liquidity. Some have also questioned OpenSea’s criteria for choosing the most promising efforts, as BSC has a significant market share and activity in the crypto space.

BNB Hacker Loses Over $53M After Getting Liquidated in Market Crash 📉

The hacker behind the infamous $600 million BNB Smart Chain exploit that occurred in October 2022 was among the list of traders liquidated by the sudden market pullback in the crypto space yesterday. Specifically, a crypto wallet linked to the exploit had its $53 million collateral liquidated on the crypto lending platform Venus Protocol. The hacker apparently used the tokens as collateral for a $30 million USDT loan on the protocol.

The liquidation was triggered by the sharp drop in the price of BNB, which fell below $220 yesterday, according to CoinGecko. The BNB Core team had previously passed a governance proposal in November 2022 to manually liquidate the hacker’s position in order to minimize the impact on the BNB Chain ecosystem. However, the market crash gave them an opportunity to execute the liquidation without causing further damage.

The hacker had exploited the BNB Chain bridge and minted 2 million BNB tokens before using 900,000 BNB as collateral to borrow $150 million worth of stablecoins on Venus. The hacker later returned most of the stolen funds, except for 900,000 BNB that remained locked as collateral on Venus.

The market crash also affected many other traders and investors, who saw their positions wiped out by over $1 billion worth of liquidations in the last 24 hours, according to Coinglass. However, some were able to minimize their losses by selling their assets before the crash. For example, a crypto whale sold over 22,000 ETH, worth around $41 million, and avoided a potential loss of over $5 million in value.

Conclusion

That’s all for today’s Crypto News Roundup. I hope you enjoyed this episode and learned something new. If you did, please give a thumbs up and subscribe to my newsletter for more crypto news and updates. Thank you for watching and see you next time! 🙌

Sources 🔗

1. Mark Cuban, Yuga Labs Lead Backlash Over OpenSea's NFT Royalties Change | Source: Decrypt
2. Crypto Lender Exactly Hit by $12M Bridge Exploit | Source: CoinDesk
3. OpenSea Ends Support for BNB Smart Chain | Source: The Block
4. BNB Hacker Loses Over $53M After Getting Liquidated in Market Crash | Source: Cointelegraph

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