Sometimes, it’s best to “hodl”—even if it means putting one of the biggest art auction houses on earth to shame.
Earlier this week, Sotheby’s auction for 104 crypto punk non-fungible tokens (NFTs) was abruptly withdrawn. NFTs have become a highly lucrative asset class in their own right, driven by the growing popularity of smart-contract digital tokens such as Ethereum (ETH-USD), with unique images showing eye-popping sales amid growing mainstream interest. gives.
But minutes before the auction, Sotheby’s announced that, after discussion with collector Crypto Punk, the sale would be cancelled. pseudonym collector, ox650dconfirmed that they decided to “hodl” – using the term cryptocurrency to ‘hold’ an asset.
The exact reason the mysterious collector stepped out remains a mystery. Although the Aux 650 had previously expressed optimism about the sale, an auction earlier this month offered the collection the prominence it has yet to receive from the wider fine arts market.
“I cannot miss the opportunity to elevate Cryptopunks in the international art community. And with this sale, the Cryptopunk collection will be stronger in the wider art world.” ox650d wrote on Twitter.
The collector did not respond to Yahoo Finance’s request for comment, but claimed on Twitter how the decision may have accomplished the same goal he had originally set out to achieve.
Over the past year, Sotheby’s, as well as their rival auction house Christie’s, have generated huge revenue and fanfare from the sale of NFTs. Back in September, Sotheby’s sold the same lot of 101 NFTs from Bored Ape Yacht Club in a single auction lot for $24 million.
A Sotheby’s spokesperson did not respond to Yahoo Finance’s request for comment.
According to Noel Acheson, Head of Market Insights at crypto prime broker, Genesis, the cancellation happened during a week when NFT investor confidence took a huge blow. Last week, hackers stole nearly $3 million worth of NFTs from 17 different OpenC customer wallets, thanks to the first phishing attack sent to customer emails.
“This is the largest NFT exploit ever to hit one of the largest NFT platforms in the industry by sale,” Acheson wrote in a research note this week.
Acheson added: “Severe losses in one segment of the cryptocurrency are likely to have different effects on other parts of the market.”
Lack of demand for NFTs is one possible theory why the Sotheby’s auction took place. According to crypto data provider Dune Analytics, trading and fees revenue on OpenC – the largest NFT marketplace – halved by early February, after seeing trading volume hit a record high in January. The decline coincided with an intense period of volatility in crypto, which has been weighed down by broader risk.
David Hollerith covers cryptocurrencies for Yahoo Finance. follow him @dshollers,
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