Bored Ape Yacht Club owner Yuga Labs's latest NFT drop, Otherdeed, resulted in millions lost in scams and enormous transaction fees, impacted the entire Ethereum blockchain and cratered ApeCoin to the tune of $320 million in revenue for the NFT giant.
Many criticisms of Yuga Labs’ practices in conducting the Otherdeed sale have surfaced from users, but some of the most pointed were aimed at how the buying spree reinforced issues of financial inequality in the crypto space.
According to Yuga Labs, it implemented “Know Your Consumer” or KYC measures meant to vet buyers and limited approved wallets to two mints. That along with the “significant clearing price” of 305 ApeCoin was supposed to, in the company’s mind, prevent gas fee hikes and impacts on the Ethereum blockchain. But multiple people pointed to how these measures would favor those with large Ethereum holdings as gas fees had to be paid in Ethereum.
There were also accusations that some buyers circumvented the two mint restriction, including self-described crypto enthusiast and eCommerce entrepreneur Steve Tan who noted his purchase of 306 Otherdeeds plots in a. When criticized for doing so, Tan said buyers that weren’t able to mint “aren’t willing to pay for gas” rather than those with smaller Ethereum holdings not being able to afford the seismic rise in gas fees caused by the stresses to the blockchain.
“Yuga deserves better class people to be in their community. Not selfish ponsy brats,” wrote one Twitter user. “They fucking want the next 100K airdropped to them alone. Yuga, just see what pathetic selfish shitholes of people who call themselves elite in your community.” When the most popular and financially successful company in the NFT space still runs headlong into these kinds of issues without proper mitigation processes in place, it says a lot about how far the space as a whole still has to go in terms of consumer protections and management. And it isn’t anything good.
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