In an astonishing turn of events, an anonymous user on the OpenSea NFT marketplace has purchased a CrypToadz nonfungible token (NFT) for an eye-popping $1.6 million, equivalent to 1,055 Wrapped Ethereum (wETH). This purchase has left the crypto community puzzled, given that the average price for CrypToadz NFTs typically doesn’t exceed $1,000. The transaction took place on October 9, 2023, and has ignited a wave of speculation about its legitimacy and the origin of the funds involved.
The NFT in question is part of the CrypToadz collection, which features small, warty, amphibious creatures and was created by the pseudonymous digital artist Gremplin. Interestingly, this particular NFT was acquired just two weeks prior for a mere 0.95 ETH, roughly equivalent to $1,600. The drastic increase in value, amounting to a thousandfold, has naturally raised eyebrows within the NFT community.
Adding another layer of complexity to this transaction is the source of funds. The purchase was funded through a digital wallet that has been linked to a chain of transactions anonymized by the Ethereum coin mixing service Tornado cash
Tornado cash’s controversial role in NFT transactions
The use of Tornado Cash in this transaction has raised concerns about the origin and legitimacy of the funds involved. Tornado Cash has been associated with various instances of fundwashing, and its reputation has come under scrutiny due to its role in obfuscating the source of funds. Notably, in July 2023, nearly $60 million in Ether, which had been stolen from AnubisDAO two years earlier, was funneled through Tornado Cash. The person responsible for the theft divided and transferred the stolen funds into 100 ETH transactions, further highlighting the potential misuse of the service.
The crypto community is divided in its interpretation of this extraordinary NFT purchase. While some on Twitter have suggested that it might have been a “fat finger mistake” during the transaction, others are suspicious of the possibility of wash trading.
Wash trading involves the manipulation of market prices by repeatedly buying and selling an asset to create the illusion of high trading volume and inflate its value. It can also serve as a means to legitimize funds of questionable origin through a convoluted series of transactions and exchanges.
