Jack Kubinec

The NFT sector is buzzing about ERC-404s, a new standard enabling the conversion between NFTs and fungible tokens, merging uniqueness with liquidity.



A project named Pandora popularized the concept last week when it launched the so-called ERC-404 standard. Pandora contains a collection of 10,000 NFTs that are linked to 10,000 PANDORA tokens created on Ethereum’s ERC-20 standard.&nbsp;



When a PANDORA token is purchased from a liquidity pool, a unique NFT known as a &#8220;Replicant&#8221; is created. This process links the fungible token with a one-of-a-kind digital asset, embodying distinct characteristics. If the owner decides to sell the PANDORA token, the associated NFT is burned, meaning it&#8217;s permanently removed from circulation.



Read more: <a href="https://blockworks.co/news/web3-watch-farcaster-nfts-memecoins">Web3 Watch: Farcaster’s most popular posts are NFT and altcoin promos</a>



Additionally, the ERC-404 standard introduces an element of semi-fungibility through dynamic interaction between the fungible token and its non-fungible counterpart. Specifically, when a PANDORA token is moved between wallets, the associated Replicant NFT &#8220;regenerates,&#8221; taking on new characteristics. This mechanism allows for a blend of NFT uniqueness with the liquidity of fungible tokens.



The ERC-404 framework also allows for the minting or burning of <a href="https://blockworks.co/tag/nfts">NFTs</a> in relation to the ownership status of PANDORA tokens, enabling fractional buying and selling. This means that users can engage in transactions involving fractions of a PANDORA token—and by extension, fractions of the underlying NFT.



Read more: <a href="https://blockworks.co/news/polygon-first-node-mint">PowerLoom to host first node mint on Polygon’s PoS</a>



In the two weeks since launching on Feb 2., the “experimental and <a href="https://github.com/0xacme/ERC404">unaudited</a>” NFT standard had already <a href="https://www.cryptoslam.io/">seen</a> roughly $95 million in trading volume as of Friday morning, by far the most over that period according to CryptoSlam.&nbsp;



The token was more of a mixed bag. PANDORA <a href="https://www.coingecko.com/en/coins/pandora">fell</a> 55% in a week from its Feb. 9 high of over $32,000, according to CoinGecko. It was trading at around $14,400 at press time.&nbsp;



Following the success of Pandora’s ERC-404, other developers tried their hand at sort-of-fungible tokens. Asserting the ERC-404 “doesn&#8217;t follow existing standards, is inefficient and breaks at certain edge cases,” a group of devs <a href="https://x.com/0xCygaar/status/1757136657286119916?s=20">released</a> the DN-404 standard earlier this week. DN-404 is an attempt to create NFT fractionalization while complying with the existing Ethereum ERC-20 and ERC-721 standards.



Notably, neither standard is yet recognized by the Ethereum Foundation as an official token standard. That would depend on a passed <a href="https://blockworks.co/news/ethereum-improvement-proposals-2024">Ethereum Improvement Proposal </a>(EIP).&nbsp;



Aside from trading hype, a 404-type standard has real promise. NFTs have historically suffered from illiquidity, but semi-fungible tokens could deepen the pool by letting NFTs be traded in <a href="https://x.com/crypticd22/status/1754173700943859868?s=20">fractions</a>. And the “re-roll” mechanism caused by moving a 404 from one wallet to another could have interesting implications for Web3 <a href="https://twitter.com/0xren_cf/status/1758192228848042009">games</a>, for instance.



<h2 class="wp-block-heading">EtherRock goes to Sotheby’s</h2>



The major art auction house <a href="https://blockworks.co/tag/sothebys">Sotheby’s</a> is currently hosting an online sealed auction for an EtherRock, one of 100 rock NFTs minted on <a href="https://blockworks.co/tag/ethereum">Ethereum</a> in 2017.



The early digital collectible is on auction until Feb. 21. The sale is expected to close at $500,000-700,000, according to the auction <a href="https://sealed.sothebys.com/ether-rock/auction">site</a>. It’s all <a href="https://x.com/Sothebysverse/status/1757925283095519315?s=20">happening</a> off-chain though, with the sale price only being made known to the buyer and seller.



Hype surrounding the sale has caused other EtherRocks to <a href="https://x.com/nftnow/status/1757291355116568579?s=20">fetch</a> hundreds of thousands of dollars in the past couple weeks.&nbsp;



<h2 class="wp-block-heading">One interesting stat:</h2>



<ul>
<li>The seven-day <a href="https://dune.com/pixelhack/farcaster">average</a> of <a href="https://blockworks.co/tag/farcaster">Farcaster</a> daily active users (DAUs) fell nearly 15% from their Sunday high to under 30,000, according to a Dune Analytics dashboard.&nbsp;</li>
</ul>



Read more: <a href="https://blockworks.co/news/farcaster-just-might-be-the-new-crypto-twitter">Farcaster just might be the new Crypto Twitter</a>



<h2 class="wp-block-heading">Also of note:</h2>



<ul>
<li>Deutsche Telekom, Europe’s largest telecom provider, <a href="https://www.telekom.com/en/media/media-information/archive/dt-cooperates-with-bosch-and-the-fetch-ai-foundation-1058956">became</a> the first corporate partner of the <a href="https://blockworks.co/tag/artificial-intelligence">AI</a>-focused blockchain Fetch.ai this week. Fetch.ai is a Cosmos-built chain looking to facilitate the building, deployment and monetization of AI tools.&nbsp;</li>



<li>Spanish telecom company Telefonica <a href="https://x.com/chainlink/status/1758114142643208584?s=20">integrated</a> with oracle platform Chainlink to help prevent SIM swaps.</li>
</ul>



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Web3 Watch: Pandora ERC-404 collection tops $90M in sales, token falls 55%

Bessie Liu

A new NFT marketplace that enables users to anonymously bid on NFTs has landed on zkSync Era, Polygon PoS and Ethereum.&nbsp;



Blockframe is designing an NFT platform that innovates proprietary features and wants to ensure that creators are being prioritized.&nbsp;



In an interview with Blockworks, Mohamed El Tahawy, the president and CEO of Blockframe, said that existing barriers to entry to crypto are insurmountable.



“It’s very difficult for people to figure out how to get a MetaMask wallet, then once you have a MetaMask wallet, what are all these currencies and how do I make swaps,” El Tahawy said.



To resolve this, El Tahawy explains that Blockframe, backed by Matter Labs, will simplify this process for its users.&nbsp;



“At Blockframe, we’ve implemented a single sign-on, which means users can sign in with Google, Discord, Twitter, and we would automatically create a wallet for them,” he said.



Once a wallet is created, users can use the same interface to on-ramp, send and swap cryptocurrencies. User private keys will not be stored or accessible by Blockframe, El Tahawy notes.



<h2 class="wp-block-heading">Honest price discovery</h2>



To ensure NFT prices on Blockframe remain reliable, the team is introducing sealed bid auctions.



Rather than relying on <a href="https://blockworks.co/tag/oracles">oracles</a> to determine NFT pricing, multiple bidders will be able to place collateralized bids anonymously to establish the value of a given digital collectible. It’s made possible by zero knowledge (ZK) technology.&nbsp;



Using zkTrees designed by Polymer Labs, the team has created “<a href="https://blockframe.substack.com/p/bulk-semaphore-garden-variety-nft">Bulk Semaphore</a>,” a protocol designed to form market consensus for the price of an NFT through mass unidentified membership and signaling.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">4/ Despite their advantages, the implementation of a sealed-bid auction on the <a href="https://twitter.com/hashtag/blockchain?src=hash&amp;ref_src=twsrc%5Etfw">#blockchain</a> was impossible due to prohibitive gas costs — until now using ZK tech.&mdash; Blockframe (@Blockframe_io) <a href="https://twitter.com/Blockframe_io/status/1676584227180257280?ref_src=twsrc%5Etfw">July 5, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Using this protocol, an unlimited number of participants will be able to bid on auctions at a consistent cost. El Tahawy said the tool can also be used for anonymous voting in <a href="https://blockworks.co/tag/daos">DAOs</a>.&nbsp;



“Our partnership with Matter Labs was very strategic for their mission of scale and their contributions in creating the Block Semaphore protocol,” El Tahawy said.



<h2 class="wp-block-heading">Simplifying NFTs for creators</h2>



Creators looking to launch their own <a href="https://blockworks.co/tag/nfts">NFT</a> collections can do so directly on the Blockframe user interface (UI).



“The idea is that creators can come here and claim royalties for their collection, thereby tokenizing it,” El Tahawy said.&nbsp;



Creators can create royalty contracts for their own NFT collections, which will later represent all future cash flows. Once a royalty token is created, they can set parameters for royalty revenue.&nbsp; <img loading="lazy" decoding="async" src="https://lh5.googleusercontent.com/llXqAjr8xgqJzg8MogH98uV_L00m62cqCOl88Q8siBBxowPJkMoaYMmabNW-zd2nS2jZyrkeWBhotGJOIuHgHxfbXigT0erEnkT1zyOPoO2WrD0GTy1U7tQw0QBUTTHcXcgWHbCLywaSXLKKXMZbXA8" width="356" height="348">



Source: Blockframe



At launch, NFTs without claimed royalties will have a 0% royalty rate. The exception: the top 200 collections, which impose automatic royalty contracts.&nbsp;



Once pricing for NFTs is standardized, Blockframe plans to ensure royalties on new collections created are applied across different marketplaces —&nbsp; a <a href="https://blockworks.co/news/nft-royalties-sometimes-they-work-sometimes-they-dont">problem that has yet to be resolved</a>.



Updated Aug. 31, 2023 at 10:13 am ET: Clarified context throughout.



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Blockframe using sealed bid auctions for NFT price discovery

Macauley Peterson

Bounce Finance, which is pioneering new DeFi auction mechanics, debuted the proof of concept for its “mutant English auction” format at 10 am ET Friday.



The item on offer is a “Diamond Hand” necklace paired with two NFTs which Bounce calls an “homage to the &#8216;Hodl&#8217; philosophy” — a reference to the oft used meme of crypto holders through thick and thin having “diamond hands.”



The auction system is not intended to compete with auction houses, CEO Jack Lu told Blockworks.



“For a long time we wanted to work with Christie&#8217;s and Sotheby’s,” Lu said, adding they proved to be very conservative. “But I think it’s a good opportunity for us to experiment.”



Read more: <a href="https://blockworks.co/news/bounce-finance-auction-defi">Not just for the highest bidder: ‘Mutant’ auction seeks to ensure everyone benefits</a>



The necklace features a lab-created 5.5 carat diamond at its center, cradled by a hand on a 14-carat diamond chain.



From a floor price of 5 ether (about $8,300), bids will increase in 3% intervals until no higher bid is placed within a 24 hours period.



The auction mechanics reward early bidders as subsequent bids not only refund the unsuccessful bidders’ gas fees on the <a href="https://blockworks.co/tag/ethereum">Ethereum</a> mainnet, but also generate a small bonus.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">🎊 𝐃𝐈𝐀𝐌𝐎𝐍𝐃 𝐇𝐀𝐍𝐃 𝐍𝐄𝐂𝐊𝐋𝐀𝐂𝐄 𝐀𝐔𝐂𝐓𝐈𝐎𝐍 𝐈𝐒 𝐋𝐈𝐕𝐄🔥 &#8211; 1st Bid Price: 5 ETH &#8211; 2nd Bid Price: 5.15 ETH &#8211; 1st Bidder’s Rewards: 0.079797 ETH Start bidding to earn rewards! 🤑🚀 📍: <a href="https://t.co/SPqXyd937R">https://t.co/SPqXyd937R</a> Guide: <a href="https://t.co/dw9mvU71rL">https://t.co/dw9mvU71rL</a> <a href="https://t.co/paHkFuo6jp">pic.twitter.com/paHkFuo6jp</a>&mdash; Bounce Finance (@bounce_finance) <a href="https://twitter.com/bounce_finance/status/1695073922729861587?ref_src=twsrc%5Etfw">August 25, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



The necklace is designed by artist Nahiya Su and produced by FOUNDO, which describes itself as a Web3-native jewelry brand.



The final winner will receive a pair of NFTs — one embedded in the necklace using a Near-Field Communication chip — and a second commemorative NFT designed by a Sotheby’s featured surrealist artist called <a href="https://1dontknows.art/">1dontknows</a>.



Bounce’s aim is to apply its research on auction formats to a variety of DeFi use cases including <a href="https://blockworks.co/tag/nfts">NFTs</a>, tokens and advertising space. Currently, four standardized auction formats, which have been audited by Salus Security, are available to developers via an SDK.



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DeFi auction platform puts ‘diamond hand’ necklace under gavel

Bounce Finance has designed a unique decentralized auction model called the Mutant English Auction.



Incorporating elements of a classic English auction with DeFi techniques, this auction aims to provide more opportunities and benefits to participants and spur higher participation rates.



In an English auction, bidders publicly increase their offers to buy an item starting from a base price. The highest bidder wins. Losers go home with nothing.



<h2 class="wp-block-heading">The “Mutant” twist</h2>



In the modified auction method, both the auctioneer and the previous bidder benefit from a higher bid, unlike standard auctions where only the winner gains an advantage.



This encourages more people to participate&nbsp; — in game theory terms, overcoming “entry deterrence” — since they won’t go home empty-handed even if they tap out.



In this auction, the highest bidder doesn&#8217;t always pay the final price. The sharing mechanism can lead to a higher actual price, potentially increasing revenue for the auctioneer. Thus, both bidders and the auction house have incentives to participate.



Encouraging more participation increases the final price for the auctioneer. It’s an enticing prospect inspired by DeFi&#8217;s yield optimization principles.



<h2 class="wp-block-heading">The math behind the mutant</h2>



The paper goes into detail about the mathematics, but in simple terms:



<ul>
<li>The price of an item increases with each bid.</li>



<li>The difference between the current and previous bid is the &#8220;price appreciation.&#8221;</li>



<li>This appreciation is shared between the auctioneer and the previous bidder.</li>



<li>Bidders earn rewards based on a set percentage from the difference in consecutive bids.</li>
</ul>



As the world of <a href="https://blockworks.co/tag/blockchain">blockchain</a> and <a href="https://blockworks.co/tag/defi">DeFi</a> grows, this auction format could become a game-changer in how decentralized auctions are conducted in various sectors.



Bounce Finance intends to present builders with a turnkey inventory of auctions formats suitable for a variety of applications — the “<a href="https://blockworks.co/tag/yearn-finance">Yearn Finance</a> for auctions,” CEO Jack Lu told Blockworks.



Different auction types can satisfy the objectives of the seller, whether they want to maximize participation, ensure a fair distribution or maximize money earned.



For example, fair token launch goals can be met more effectively by random selection with a shuffle no-loss lottery-like mechanism, better than <a href="https://medium.com/@simondlr/tokens-2-0-curved-token-bonding-in-curation-markets-1764a2e0bee5">a bonding curve</a>, Lu said.



Bounce will be <a href="https://diamondhand.bounce.finance/home">trialing</a> the Mutant English Auction itself, with a physical-digital auction combining a real-life diamond necklace paired with an NFT, later this month.







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Not just for the highest bidder: ‘Mutant’ auction seeks to ensure everyone benefits

Shalini Nagarajan

<div id="highlights-block_6319a0f7648bd" class="highlights">
 <ul>
 <li>Voyager last said it was in active discussions with 22 interested parties, but didn’t name them</li>
 <li>FTX/Alameda, Binance and Coinbase have reportedly shown interest in the lender’s assets</li>
 </ul>
 
</div>



Voyager Digital will part with its remaining assets at an auction scheduled for next week, two months after <a href="https://cms.blockworks.co/voyager-files-for-bankruptcy-days-after-freezing-withdrawals/" target="_blank" rel="noreferrer noopener">filing for bankruptcy</a>. 



A <a href="https://cases.stretto.com/public/x193/11753/PLEADINGS/1175309072280000000008.pdf" target="_blank" rel="noreferrer noopener">court document</a> filed Tuesday showed the auction will take place on Sept. 13 at 10 am ET at the New York office of Voyager’s investment banker Moelis &amp; Company. The results will be announced at a court hearing on Sept. 29 at 2 pm ET. 



Holding an auction implies that Voyager received more than one substantial bid for its assets. Finalization of the best bidder would be the first step for customers to recover their funds locked on the brokerage’s platform.



In bankruptcy auctions, a debtor may decide to liquidate its debt by allowing external parties to bid on its possessions. The external parties view this as an opportunity to buy high-cost assets at a cheaper price. Post the auction, proceeds are generally meant to go to creditors.



Voyager’s lawyers have previously said <a href="https://cms.blockworks.co/bankrupt-voyager-higher-and-better-bids-than-ftx-low-ball-on-table/" target="_blank" rel="noreferrer noopener">88 interested parties</a> had reached out to the firm, but there may have been more after the deadline for bids extended from August 26 to Sept. 6. At the time, it was in active discussions with 22 parties. 



The lender hasn’t disclosed which parties have shown interest, but Sam Bankman-Fried made a joint offer via Alameda Ventures and FTX in late July. Voyager was quick to reject that proposal, describing it as a “low-ball bid dressed up as a white knight rescue.”



Binance is another major player in the industry that was interested in snapping up Voyager’s distressed assets, while Coinbase reviewed an offer but pulled out, according to <a href="https://www.coindesk.com/business/2022/08/25/binance-ftx-among-crypto-players-in-hunt-to-buy-voyager-digital-assets-as-coinbase-backs-out-sources/" target="_blank" rel="noreferrer noopener">CoinDesk</a>.



Aside from seeking a buyer, Voyager has been attempting to extricate customer funds. Last month, it got court clearance to <a href="https://www.wsj.com/articles/voyager-digital-to-return-270-million-to-customers-11659648633" target="_blank" rel="noreferrer noopener">return $270 million</a> to customers. Another $1.3 billion in digital assets on the company’s platform will be distributed among creditors during bankruptcy proceedings.



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Voyager To Liquidate Assets at Auction

Morgan Chittum

<div id="highlights-block_62193847671c7" class="highlights">
 <ul>
 <li>The original tweet advertising the NFT auction has since been deleted by the AP</li>
 <li>AP launched its photojournalism NFT marketplace at the end of January</li>
 </ul>
 
</div>



Following widespread outcry, the Associated Press has nixed the sale of a video NFT depicting an overcrowded group of migrants clinging to an inflatable raft in the Mediterranean.



The 145-year-old news collective initially touted the NFT (non-fungible token) sale, slated to begin Friday, on Twitter. The AP backtracked Thursday night in the face of heavy social media criticism.



“Tomorrow’s drop at noon EST on the AP Photography NFT Marketplace will feature video by @felipedana of migrants drifting in an overcrowded boat in the Mediterranean,” the agency wrote in a tweet that has since been deleted.



<div class="wp-block-image"><figure class="aligncenter size-large"><img loading="lazy" decoding="async" width="608" height="1024" src="https://blockworks-co.imgix.net/wp-content/uploads/2022/02/IMG_9872-608x1024.jpg" alt="" class="wp-image-17967" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2022/02/IMG_9872-608x1024.jpg?w=608 608w, https://blockworks-co.imgix.net/wp-content/uploads/2022/02/IMG_9872-608x1024.jpg?w=178 178w, https://blockworks-co.imgix.net/wp-content/uploads/2022/02/IMG_9872-608x1024.jpg?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2022/02/IMG_9872-608x1024.jpg?w=912 912w, https://blockworks-co.imgix.net/wp-content/uploads/2022/02/IMG_9872-608x1024.jpg?w=153 153w, https://blockworks-co.imgix.net/wp-content/uploads/2022/02/IMG_9872-608x1024.jpg?w=155 155w, https://blockworks-co.imgix.net/wp-content/uploads/2022/02/IMG_9872-608x1024.jpg?w=130 130w, https://blockworks-co.imgix.net/wp-content/uploads/2022/02/IMG_9872-608x1024.jpg?w=48 48w, https://blockworks-co.imgix.net/wp-content/uploads/2022/02/IMG_9872-608x1024.jpg?w=30 30w, https://blockworks-co.imgix.net/wp-content/uploads/2022/02/IMG_9872-608x1024.jpg?w=1125 1125w" sizes="(max-width: 608px) 100vw, 608px" /><figcaption>A screenshot of the now-deleted Associated Press tweet</figcaption></figure></div>



The sale illuminates questions about journalism as a public service — especially when it comes to <a href="https://www.theguardian.com/technology/2022/feb/24/profiting-off-suffering-ap-cancels-sale-of-migrant-boat-nft-amid-backlash" target="_blank" rel="noreferrer noopener">laying bare human suffering</a> and uncovering inequities — and profiting from those accounts.



“The Associated Press is lost. Journalists at this organization should speak up and say, “When we document human suffering, the purpose is to inform the world, not to profit off NFT sales,” Michael David Smith, managing editor at NBC Sports, <a href="https://twitter.com/MichaelDavSmith/status/1496986139269419009?s=20&amp;t=Q8rMWjM3gmTwUzBic66bNA" target="_blank" rel="noreferrer noopener">tweeted</a>.



<figure class="wp-block-embed aligncenter is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">The Associated Press is lost. Journalists at this organization should speak up and say, &quot;When we document human suffering, the purpose is to inform the world, not to profit off NFT sales.&quot; <a href="https://t.co/SaBVNSpDsH">https://t.co/SaBVNSpDsH</a>&mdash; Michael David Smith (@MichaelDavSmith) <a href="https://twitter.com/MichaelDavSmith/status/1496986139269419009?ref_src=twsrc%5Etfw">February 24, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Software engineer and Web3 writer Molly White said the decision to “monetize a video of human suffering” made obsolete “any goodwill the AP might have had for their NFT project.”



“The already horrific NFT announcement was particularly ill-timed, given its juxtaposition on many Twitter feeds amongst news of Russian military action against Ukraine,” White <a href="https://web3isgoinggreat.com/?id=2022-02-24-1" target="_blank" rel="noreferrer noopener">tweeted</a>.



Lauren Easton, an AP spokesperson, told Blockworks in a statement that the NFT was “a poor choice of imagery” that “has not or will not be up for auction.”



“AP’s NFT marketplace is a very early pilot program, and we are immediately reviewing our efforts,” Easton said. “As a not-for-profit, AP’s mission is to inform the world with accurate, unbiased journalism. That remains our primary focus.”



AP <a href="https://cms.blockworks.co/associated-press-archive-photography-to-be-sold-via-nfts/" target="_blank" rel="noreferrer noopener">first launched</a> its photography NFT marketplace at the end of January, then billed as a way to give “collectors the opportunity to access AP archives and collect unique NFTs — including AP’s Pulitzer Prize-winning images.”



The marketplace has since released NFTs on a rolling basis, with prices ranging from $219 to $1,799. Proceeds go to the non-profit newsroom.



“AP’s photographers have recorded the world’s biggest stories through gripping and poignant images that continue to resonate today,” Dwayne Desaulniers, AP director of blockchain and data licensing, previously told Blockworks. “As new audiences and opportunities emerge on-chain and adopt the benefits of NFTs, we’re watching closely and responding in order to find the right models to present AP journalism on-chain.”



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AP Calls Off Sale of Stranded Migrants NFT After Twitter Outcry

<div id="highlights-block_115dd61d8d1f64221c40b2bd051eb171" class="highlights">
 <ul>
 <li>The NFTs were valued at $20 million to $30 million</li>
 <li>The group of CryptoPunks were originally acquired in a single transaction by collector “0x650d”</li>
 </ul>
 
</div>



Sotheby’s did not auction off the 104 CryptoPunks originally slated for Wednesday evening. In a turn of events for the New York auction house, the bid was withdrawn.



Derek Parsons, senior press officer of Sotheby’s Americas, told Blockworks in an email that the CryptoPunks were withdrawn prior to the sale following “discussions with the consignor.”



“nvm, decided to hodl,” the pseudonymous consignor of the auction <a href="https://twitter.com/0x650d/status/1496646517003800578?s=20&amp;t=VNVK5V6cEDJmhAwPiZFIqw" target="_blank" rel="noreferrer noopener">tweeted</a> following Sotheby’s <a href="https://twitter.com/Sothebysverse/status/1496641937083969543?s=20&amp;t=EIa07KM8FifubypGLMT2DQ" target="_blank" rel="noreferrer noopener">announcement.</a>&nbsp;



The withdrawal announcement was made in the crowded auction room roughly 23 minutes after bidding was scheduled to commence. However, onlookers were encouraged to enjoy an afterparty with live music by DJ <a href="https://blockworks.co/news/what-are-seed-phrases">Seed Phrase</a>. 



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">nvm, decided to hodl <a href="https://t.co/WdQ5H7I0fl">https://t.co/WdQ5H7I0fl</a>&mdash; 0x650d (@0x650d) <a href="https://twitter.com/0x650d/status/1496646517003800578?ref_src=twsrc%5Etfw">February 24, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
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Two sources familiar with the matter told Blockworks that there were not enough bidders on the single-lot auction. Sotheby’s declined to comment on any logistics regarding bidders.&nbsp;



The group of CryptoPunks were originally acquired together in a single transaction by anonymous collector “0x650d.” CryptoPunks were released in 2017 by studio Larva Labs and currently have a floor price of $177,663, according to blockchain data dashboard <a href="https://nftpricefloor.com/cryptoPunks" target="_blank" rel="noreferrer noopener">NFT Price Floor</a>.



The NFTs (non-fungible tokens) were valued at $20 million to $30 million.



Michael Bouhanna, co-head of digital art at Sotheby’s, had earlier described the sale as a “first-of-its kind” due to its focus on CryptoPunks in the auction house’s Feb. 8 <a href="https://cms.blockworks.co/sothebys-set-to-auction-off-104-cryptopunks-valued-at-20m-to-30m/" target="_blank" rel="noreferrer noopener">announcement</a>.



“CryptoPunks are the original PFP [profile picture] series that created the template for other NFT projects that have followed, and which helped propel NFTs to the global stage as one of the most recognizable visual styles that have become synonymous with the digital art movement,” Bouhanna said in a statement.&nbsp;



Last year, Sotheby’s launched an NFT marketplace and sold $100 million worth of the blockchain-based digital collectibles, according to an annual <a href="https://cms.blockworks.co/sothebys-reports-100m-in-nft-sales-attracts-younger-tech-savvy-collectors/" target="_blank" rel="noreferrer noopener">report</a> from the auction house.



Bouhanna told Blockworks that NFT sales have expanded Sotheby’s audience reach to a “whole new group of collectors.”&nbsp;



“I think we will continue to see growth of new collectors at Sotheby’s who come to us via our NFT sales, as well as more art collectors more familiar with contemporary and modern art exploring NFTs as they continue to become more prominent in pop culture,” Bouhanna said.



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Sotheby’s CryptoPunk Auction Canceled After Seller Withdraws

<div id="highlights-block_620eb6ad49980" class="highlights">
 <ul>
 <li>The new collection will consist of 10,000 NFTs and each will cost $50</li>
 <li>The forthcoming sale will begin on Feb. 21 — Presidents’ Day</li>
 </ul>
 
</div>



Despite <a href="https://www.bloomberg.com/news/articles/2022-02-16/who-won-the-melania-trump-nft-auction-trump-crypto-wallet-linked-to-185k-funds" target="_blank" rel="noreferrer noopener">reports</a> that Melania Trump herself won an auction for her first NFT, the former first lady is rolling out another set of digital collectibles.



“POTUS NFT Collection” will “recognize important moments in [America’s] history,” such as NFTs (non-fungible tokens) depicting Mount Rushmore, the White House and Air Force One, Trump said in a statement. Up for sale: 10,000 solana NFTs priced at $50.



“Collectors will enjoy an element of surprise, as the artwork of each NFT is revealed only after purchase,” Trump said. “Of course, collectors can make multiple purchases to own the entire POTUS Trump Collection.”



The sale is set to begin on Feb. 21 — Presidents’ Day.



Trump’s NFT efforts are in question after <a href="https://www.bloomberg.com/news/articles/2022-02-16/who-won-the-melania-trump-nft-auction-trump-crypto-wallet-linked-to-185k-funds" target="_blank" rel="noreferrer noopener">Bloomberg reported</a> the former first lady purchased her first NFT herself. The funds used to purchase Trump’s collection were traced back to a wallet that belongs to the creators of the project.



Trump announced her <a href="https://melaniatrump.com/head-of-state" target="_blank" rel="noreferrer noopener">“Head of State Collection”</a> late last year, which featured a white hat, along with a painting of herself and voice recording, as part of the “historic auction.”  Although the starting bid was $250,000, the NFT sold for roughly $180,000.



A spokesperson for Trump denied that the project&#8217;s creator purchased its NFT.



&#8220;The nature of Blockchain protocol is entirely transparent. Accordingly, the public can view each transaction on the [blockchain],” a representative said in a <a href="https://www.bloomberg.com/news/articles/2022-02-16/who-won-the-melania-trump-nft-auction-trump-crypto-wallet-linked-to-185k-funds" target="_blank" rel="noreferrer noopener">statement</a>. “The transaction was facilitated on behalf of a third-party buyer.”



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Melania Trump Announces ‘POTUS NFT Collection’ Amid Controversy

<div id="highlights-block_6202a22b4b83d" class="highlights">
 <ul>
 <li>Sotheby’s previously sold one CryptoPunk NFT for $11.8 million in June 2021</li>
 <li>The auction house sold $100 million worth of NFTs in 2021, according to its annual report</li>
 </ul>
 
</div>



Sotheby’s will auction 104 CryptoPunks Feb. 23, the New York auction house said Tuesday. The NFTs carry an estimated value of $20 million to $30 million.



Michael Bouhanna, Sotheby’s co-head of digital art, described the sale as a “first-of-its kind” and “monumental” in part due to its focus on CryptoPunks.



“CryptoPunks are the original PFP series that created the template for other NFT projects that have followed, and which helped propel NFTs to the global stage as one of the most recognizable visual styles that have become synonymous with the digital art movement,” Bouhanna said in a statement.&nbsp;



The group of CryptoPunks set to be auctioned was originally acquired together in a single transaction by the anonymous collector “0x650d.” CryptoPunks, which were released in 2017 by studio Larva Labs, currently have a floor price of $210,374 each, according to crypto data provider <a href="https://nftpricefloor.com/cryptoPunks" target="_blank" rel="noreferrer noopener">NFT Price Floor</a>.



For the evening auction, Sotheby’s will accept cryptocurrencies like bitcoin and ether, as well as fiat currencies. All 104 CrypoPunks will be bundled together in a single-lot sale.&nbsp;



However, this isn&#8217;t Sotheby&#8217;s first foray into blockchain-based digital collectibles.



Sotheby’s <a href="https://cms.blockworks.co/sothebys-reports-100m-in-nft-sales-attracts-younger-tech-savvy-collectors/" target="_blank" rel="noreferrer noopener">launched</a> an NFT (non-fungible token) marketplace called Sotheby’s Metaverse in October 2021,&nbsp; making it the first auction house to start such a platform. Sotheby’s earlier sold CryptoPunk #7523 for $11.8 million in June 2021.



The auction house dubbed its performance in 2021 as “the strongest total in [the] company’s 277-year history,” in an <a href="https://cms.blockworks.co/sothebys-reports-100m-in-nft-sales-attracts-younger-tech-savvy-collectors/" target="_blank" rel="noreferrer noopener">annual report</a>, in part due to its $100 million of NFT sales.



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