Magic Eden hops on the optional creator royalties trend

GM Baos,

It's a new week! You know what that means – new news, new trades. And this week we have some juicy content in the world of creator royalties.

We cover:

• Magic Eden 0% royalties

• The largest DeFi bug bounty 🥴

• CoinShares’ Twitter bot

Magic Eden’s optional royalties

It was a sad weekend for the NFT community. Magic Eden announced their switch to optional royalties. The reality is that royalties aren’t enforceable on chain.

Shortly after the announcement they held a town hall Twitter space so everyone could talk with the founders and share ideas.

Town hall notes:

• Magic Eden didn’t want to be put in this position & it happened way faster than they anticipated. But this was inevitable from the moment 0% royalty marketplaces starting coming out. They want to survive so they have to adapt.

• Just because they moved to optional royalties doesn’t mean they won’t implement tools to help creators enforce royalties. They’re investing $1m to launch a Creator Monetization Hackathon

• Social norms go a long way in the NFT space, it wasn’t until marketplaces took away royalties that there was knowledge royalties were optional

• One of the mistakes they made with MetaShield was only talking to creators—not any NFT collectors/traders. This time they’ve talked with various people across the space

• When they launched MetaShield people hated them. Then when they decide to follow the trend, people hate them. Magic Eden is experimental & they’re doing their best

Magic Eden has been losing marketshare to NFT marketplaces Yawww, Solanart and Hadeswap. Maybe this move towards optional royalties will help. Where do you stand in the royalties debate?

Mango Markets hacked for $100 million 🥭

Solana can’t catch a break.

Another $100m has been stolen from the crypto markets this month. This time it’s Mango Markets — a decentralized spot margin and perpetual futures exchange built on Solana.

How the exploit happened:

• The hacker manipulated the price oracle of MNGO (Mango governance token) 📈

• He deposits $10m USDC onto Mango from FTX. He then opens a MASSIVE long position ($480m) that causes MNGO’s price to pump ~1,000%.

• After the hackers account collateral goes up, they borrow against their unrealized MNGO gains. Leaving them with under-collateralized loans and having effectively drained the entire protocol.

The next day the hacker submitted a governance proposal. He wanted to keep $70m USDC as a bug bounty reward and send $50m back to cover the remaining bad debt in the protocol.

Not only did he submit the proposal, he cast 33 million yes votes using the stolen MNGO funds 😱 Luckily, that wasn’t enough votes to pass and the proposal was rejected!

Mango Markets countered his proposal and offered him the chance to collect a $47 mil bug bounty in exchange for returning $67 mil of stolen funds. With an agreement to not pursue any criminal investigations/freeze funds after the tokens are sent back.

The community voted to pass the proposal and the money was returned by the exploiter. Then in a shocking turn of events, Avraham Eisenberg reveals himself as the culprit. On Twitter he claimed that what he did was 100% legal. He believes it’s similar to how auto-deleveraging works on exchanges like Binance.

Honestly, I’m sooo relieved I wasn’t trading on Mango during all this chaos 😬

CoinShares’ Twitter Bot

Digital asset manager, CoinShares launched a experimental Twitter bot that lets you check the fair market value of an NFT.

How do you use the bot? Tweet at @CoinSharesNFTAI and include the OpenSea link! Right now the bot only works with a select number of NFT collections. Mainly blue chip projects like Doodles, Bored Ape Yacht Club, Moonbirds and Azuki.

I saw that four days ago Azuki #5558 was sold for 200 ETH on X2Y2. So I tried it on that Azuki NFT and the bot said it‘s fair value is 13.73 ETH ($17,901.61) 😆

Several Twitter users have said this bot sucks. What do you guys think? Is this AI experiment a fail?

Bao-Sized News

• Beeple is building a physical studio for NFTs

• Magic Eden is losing market share with other marketplaces removing creator royalties

• DeGods dropped creator royalties to 0

Made us Kek

Happy Monday, let's smash this week out Baos 💙

–Cassidy