CryptoPunk Sells for $56M, Internet Speculates Wash Trade

On Oct 5. a CryptoPunk NFT sold for 24,000 ETH (or around $56.2 million at current prices), sending Crypto Twitter into a frenzy. However, there are several problems with the sale that are raising suspicions in the community. First, according to data from Rarity Sniper, Punk #1563 is only ranked 3724 in rarity. That puts it in the top 50% for rarity in the iconic 10,000-piece collection, but it certainly doesn’t beget a price tag in the millions, much less $50+ million.

Here are a few other issues about the record-breaking transaction that are raising eyebrows:

• The sale is more than double the price of the next largest CryptoPunk sale, which occurred in February 2022 for the price of $23 million. Punk #5822 is 1/9 Alien Punks and ranked 17th in overall rarity.
• A review of onchain data from Etherscan shows the “buyer” took out a 24,000 ETH flash loan from Balancer, an automated market maker (AMM). After the purchase, the buyer returned the. 24,000 ETH to Balancer, indicating the buyer likely sold the Punk to himself. This is called a wash trade.
• A crypto analyst that goes by OxQuit said that the sale was likely part of a promotional campaign for “Kamala Harris Punk,” a new political memecoin. He added that it was probably a “psyop” and “maybe a political statement given the name and the clown makeup.”

For now, Larva Labs, the creators of CryptoPunks, has chosen not to classify the sale as legitimate and most NFT platforms have followed suite. Also, this isn’t the first time we’ve seen an enormous CryptoPunk purchase that was likely a wash trade. Back in 2021, a user bought CryptoPunk 9998 with a $532 million flash loan that was quickly repaid to the AMM.