At the beginning of August 2021, it was reported that a buyer purchase over 100 Ethereum based Non-Fungible Tokens (NFTs) from the popular collection CryptoPunks. According to the reports, the anonymous investor tried not the attract too much attention and used the decentralized block production protocol MiningDAO.
Therefore, he bride a miner to include all the CryptoPunks purchases on a single Ethereum block. The trade was well planned and calculated, as a community member reported. Previously, the anonymous buyer made a smaller purchase at the height of block 12924823, Etherscan recorded.
Usually, to buy one of these NFTs, a user executes a “normal” Ethereum transaction. The anonymous buyer tried to mitigate a reaction from the NFT market. Thus, why they included operated under the radar.
In total, the CryptoPunks, some of the cheapest in the collection amounted to a staggering $7 million. The actions taken by the buyer could be a preview of a standard use by big players to carry out high-value transactions without spooking the market, as the community member said:
(…) the buyer paid a miner a bribe to take all their “buy punk” transactions and put them all in the front of a block sequentially in private. this did not give anyone a chance to react to raise their price or delist because no one saw the txs until the block was mined.
The event was just one of many that led the Ethereum NFT market into a state of frenzy. Around the same period as the anonymous purchase, the CEO of Vaynermedia Gary Vaynerchuk bought a single CryptoPunks for $3,76 million.
In the next 24 hours after that purchase, the items that comprised the CryptoPunks collection saw $50 million in sales.
Ethereum Network Activity Explodes On CryptoPunks Fever
A recent report by research firm Coinmetrics records a massive growth in the Ethereum based NFT sector for 2021. As seen below, the sector saw an important growth in September 2020 and a declined in November and December that year.
The amount of ERC-721, the Ethereum standard used by CryptoPunks and other NFTs, transfer count exploded during March 2021. This metric saw an important decline two months later but jumped to all-time highs with over 50,000 transactions in July.
Since its inception, the CryptoPunks NFT collection has been increasing its sales on Ethereum exponentially. 2018 and 2019 represent its least selling years, but the metric skyrocketed in July 2020, with the “DeFi Summer”.
This has translated into other NFT based art platforms, such as Art Block, Coinmetrics noted:
Art Blocks, a platform for creating generative NFT art, has also registered all-time high activity in recent weeks after Three Arrows Capital went on an NFT buying spree mostly focused on Art Blocks and CryptoPunks. With NFTs becoming a mainstay of the burgeoning digital economy on Ethereum, institutional players may be taking notice and contributing to this recent rise in volume and activity.
At the time of writing, ETH trades at $3,208 with a 6.3% profit in the daily chart.