Blur Airdrop: Did Whales Game the System? Report
- The 23 most active traders got over one million in Blur tokens. One trader received more than 3.2 million BLUR tokens.
- Reports suggest that this address traded large quantities of NFTs back and forth. This could indicate that the trader engaged in wash trading or trying to game the Blur airdrop.
Blur, the professional NFT marketplace, is airdropping Blur tokens to NFT traders. Since Wednesday, eligible traders can get Blur tokens for free, which they can keep or sell for profit.
Most already took advantage of the situation. Traders claimed over 90% of the 360 million tokens, valued at $0.9 each. However, the Blur token airdrop disproportionately benefited a small number of traders. Moreover, reports suggest that these traders might have gamed the system.
According to Nansen, the 23 most active users received more than one million blur tokens. Moreover, one trader received more than 3.2 million BLUR tokens. These tokens are worth about $0.9 each, meaning that the biggest traders received a multi-million dollar windfall.
The biggest trader got nearly $3.2 million in Blur tokens, according to data gathered by a blockchain intelligence agency Dune.
It is a relatively new wallet from only three months ago. According to Decrypt, a look at the address shows that the wallet traded the same NFTs repeatedly.
Interestingly, the wallets with the second and the third biggest airdrop values (2.9M and 2.5M Blur, respectively) also interacted with the first wallet. This behavior raises concerns over potential wash trading, or an attempt at gaming Blur’s airdrop mechanics.
Vijay Pravin, the founder and CEO of NFT analytics firm bitsCrunch, also raised concern over wash trading.
“All of these addresses have been trading NFTs back and forth with each other,” Pravin said about the three biggest winners of the Blur airdrop. “They wash-traded!” he continued.
According to on-chain data, the second-largest airdrop recipient cashed out 1.7 million in Blur tokens. The other two wallets are still holding all their Blur tokens.
Blur offered about 12% of their tokens in the airdrop. 86% of Blur tokens are in three wallets associated with the founders.
Wash Trading: Ongoing Issue for NFTs
Wash trading is when a trader buys and sells an asset to artificially inflate its price. The purpose of wash trading is to feed false information to the market and to sell assets at artificially high prices.
In traditional markets, wash trading is highly illegal. However, similar regulations are missing on NFT marketplaces, where wash trading is incredibly common.
Wash trading has been a constant issue in the NFT space, which Blur also highlights. In December 2022, Blur shared a chart showing the relative volume of NFT wash trades since 2020.
The chart came from data scientist hildobby, who works with the Dragonfly crypto venture fund. He created a filter that separates wash trades from the rest of the market. According to the chart, wash trades made up 44% of all NFT trading volume from 2021 to November 2022.
On the Flipside
- There is no definitive proof that the wallets in question had the intention of manipulating the market or gaming Blur.
- After the FTX collapse, US regulators are currently cracking down on crypto practices that take advantage of smaller investors.
Why You Should Care
Blur has become one of the biggest NFT marketplaces, rivaling OpenSea. NFT traders should be worried about potential wash trading on its platform.
Read more about the token airdrop:
Blur Airdrop: Just 23 Users Received More Than $1 Million in BLUR Each
NFTs have still not recovered from their 2022 crash. Read more about it here:
NFT Trading Volume Has Crashed 97% from 2022 Highs
Read more: https://dailycoin.com/blur-airdrop-did-whales-game-system/
Text source: DailyCoin.com
