How to protect your NFTS

How to protect your NFTS

Last month, a crypto twitter influencer accidentally destroyed its $ 129,000 cryptopunk. Here are some best practices to protect their NFTs from losses through technical breakdowns with their crypto.

"This is really a devastating mistake for me.💔 But I did it myself, and it is not to blame for anyone. Both the beauty and the curse of self -government." tweeted Krypto investor Brandon Rile: " You are much more careful than me.

nft collector loses $ 129,000 cryptopunk

Riley reported on March 24 that he "accidentally burned a non -fungi token, Cryptopunk #685". The health, fitness and financial influencer tried to pack his cryptopunk.

wrapping extends the Smart Contract functionality of the NFT, so that it can be listed for trade in Ethereum NFT markets. This includes popular NFT exchanges such as OpenSea and Rarible.

But the NFT collector made a tragic mistake by entering the wrong address while he followed the instructions to pack his nft for the first time. As a result, he irretrievably sent his and destroyed a third of his net assets by investing in cryptocurrency:

"I was concentrated to follow the instructions that I made a mistake and destroyed a third of my net capacity in a single transaction."

riley wrote:

“For those who wonder how this happened ...

When trying to create a proxy wallet, something went wrong.

follow the instructions on the website, step 1. I have accessed the contract on Etherscan.

Step 2. I entered my own wallet address and tried to access my proxy wallet address.

Step 3 reads: “Spring step 2 if the address is not 0x00… 0000“

I understood that because the address was exactly the same, it had to be correct and I could go over to the next step. I thought that was the proxy address that I should use.

I followed step 4 to "write a contract" and "to register" proxy, then step 5 to copy the proxy address ...

I should have known that something was wrong and had to realize that this was a mistake, but I didn't. It was only when I wanted to shape my wrapped punk that the astronomical gas betrayed it. ”

Unfortunately, Riley went on his feet alone with $ 129,000 in tow and did what the developers call "lonely wolf". He carried out code to pack his NFT without having done it beforehand, and without advice or peer review from anyone else in the NFT community before heading head across the operation.

How to take care of yourself out there in Defi

If it was a centralized corporate application that Riley had to do, he could have sent customer support an email. For an account with a wealth of $ 129,000 on its platform, the company would certainly have fixed the problem and restored the ownership of the user.

But would the NFT have been so much worth so much in such a scenario with centralized company supervision? It is unlikely.

Nevertheless, the overall market capitalization of Ethereum in this mild market is well over $ 200 billion. It has a higher market capitalization during bull markets. On November 21, 2021, Ethereum was worth almost $ 600 billion. Why is it so valuable despite these dangers?

investors are ready to enter into the risks of this compromises for the freedom of centralized control that Defi offers. With Fiat assets, investors can wake up tomorrow and find that the value of their stocks has dropped. But with Defi, investors can be sure that their assets are rated from the market.

For this compromise, however, there is a higher duty of care from Ethereum investors. The NFT collector, who lost $ 129,000, should have been more careful if he tried a new technology on a P2P platform.

Before trying something new with a valuable digital asset, first try to pack another NFT that is worth a cent. Perhaps try to pack several penny nfts to find these problems and to fix it inexpensively.

This can be expanded for beginners on almost every excursion into the cryptocurrency.

If you are doing something new for the first time, it is a beginner, whether it is an absolute newcomer to set up his first coin base account, or a department of Binance that is launching a new product.

.