CryptoPunk Heist: $1M NFT Snagged For $18,000 In Smart Contract Exploit

A savvy crypto enthusiast has acquired a valuable CryptoPunk NFT for a fraction of its market value, exploiting a dormant smart contract from a defunct fractional ownership platform.

What Happened: The CryptoPunk in question, Ape #2386, was originally fractionalized on Niftex, a now-defunct platform, at a valuation of approximately 450 Ether ETH/USD (over $800,000 at current prices).

The NFT remained trapped in an escrow contract even after Niftex shut down operations.

According to crypto analyst @niftynaut on X, the smart contract governing the fractionalized ownership had a little-known buyout clause.

This clause allowed for a 14-day grace period during which shareholders could accept or reject a buyout offer.

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Two weeks ago, an unnamed individual proposed a buyout at 0.001 ETH per share. With 10,000 shares outstanding, this amounted to a total offer of just 10 ETH (approximately $18,000).

Astonishingly, this proposal went unchallenged during the grace period, allowing the buyer to acquire full ownership of the CryptoPunk for a mere fraction of its value.

For context, recent sales of similar CryptoPunks have ranged from 620 ETH to 3,300 ETH, putting the potential value of Ape #2386 well into the millions of dollars.

What’s Next: The risks and opportunities associated with smart contracts and NFTs will be key topics at Benzinga’s Future of Digital Assets event on Nov. 19, where industry leaders will explore how these technologies are reshaping the financial landscape.

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