Studio Yuga Labs returned the money to some participants in their new NFT project. Who received compensation?
Yuga Labs, the developer studio behind the popular Bored Ape Yacht Club (BAYC) NFT collection, has announced a “gas fee refund” for all users whose transactions were not confirmed during the recent Otherdeed token issuance and ended in loss of money. Otherdeed itself is the rights to a virtual earth in the Otherside metaverse, which combines several well-known NFT series at once. Thus, the developers tried to improve their own reputation and at the same time get rid of the criticism of the users of the project. Let's talk about the situation in more detail.
The launch of a new collection of NFTs ended with a new record of fees spent on the Ethereum network. In particular, the indicator reached $227 million per day, which is exactly how much blockchain users spent on May 1, 2022 to conduct transactions in it.
The previous high was $112 million, and it was recorded in May 2021 during a huge market crash .
What happens to NFT from Bored Ape Yacht Club
During the release of Otherdeed tokens, over $157 million was spent on commissions on the Ethereum network. This led to a short-term increase in the cost of the average transaction in the Ethereum network to an all-time high. Such large numbers are caused by the general excitement around Yuga Labs and new studio projects.
Recall that for any interaction with the cryptocurrency network, the user must pay a commission, which is measured in gas. The more commission he pays to the miners, the higher his transaction will be in the queue for adding to the block. Because Otherdeed had a limited supply, crypto enthusiasts tried to be the first to get their hands on the coveted NFTs and were therefore willing to pay thousands of times the average transaction value.
In particular, some participants in the sale reported that they paid a fee of at least twice the cost of the NFTs themselves, which were valued at 305 ApeCoin (APE) or approximately $5,800 at the time of token release. Often, even such amounts were not enough, but at the same time, funds for gas were still charged - because this is how the blockchain works.
Recall that the transaction will be broadcast to the network even at a low gas price. As a result, the latter may be used up, as a result of which the operation will not be performed. However, since the gas will be burned, the user will lose money for the transaction. Moreover, during the overload of the blockchain, the amounts can be quite large. It was they who were reimbursed by representatives of the Yuga Labs project.
Assess the scale of what happened for yourself: in the period from April 25 to May 2, 56 percent of all burned Ethereum accounted for the emission of Otherdeed. That is, it was this project that made the greatest contribution to the destruction of ethers, which are burned as commissions.
One of the users wanted to participate in the sale so much that he spent more than 44 thousand dollars on commissions. According to Decrypt sources , his transaction "passed" to the blockchain, so he did not receive a refund. In total, developers from Yuga Labs spent 90.57 ETH to compensate other participants in the sale. The largest compensation amount is 2.6 ETH or $7,500.
In just a year of its existence, the Bored Ape Yacht Club collection has already become a well-known brand in the crypto market. The top three NFT projects to date are owned by BAYC developers. Third place goes to a separate collection called Mutant Ape Yacht Club (MAYC). In second place is the original BAYC line. The top spot is currently occupied by Otherdeed, with $50 million in transactions in the last 24 hours.
While BAYC and MAYC are essentially unique digital avatars, Otherdeed's concept is a bit more complex. These are 55 thousand unique tokens that give their holders the right to own virtual property in the Otherside metaverse.
By the way, after the issue of Otherside, a wave of criticism hit Yuga Labs. Many suggested that the company could have chosen a more efficient format for launching the project. Later, representatives of Yuga Labs hinted that they could well transfer the native ApeCoin token for the BAYC ecosystem to their own blockchain. Perhaps it would be more centralized than Ethereum, but this would solve the problem with huge fees. Therefore, it is likely that the project ecosystem will develop further, including reaching the scale of its own block chain.
We believe that such a step by the developers is optional, but quite understandable. In this way, they wanted to keep the loyalty of the fans who wanted to connect with the project, but were unable to do so. Still, the average commission for conducting transactions on the Ethereum network that day was the equivalent of $193, so the bonus is quite pleasant. Obviously, thanks to this, some investors will reconsider their attitude towards Yuga Labs, which could have deteriorated due to an unsuccessful transaction and loss of money.
You can follow the development of the situation in our millionaire crypto chat . There we also discuss other popular NFT tokens that bring huge profits to their investors.
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