A Solana engineer has revealed that FTX was using Web2 APIs for the metadata of non-fungible tokens (NFTs) offered on its platform. Now, the NFTs are redirected to the FTX bankruptcy site and their data is corrupted. As a result, holders of some of these NFTs are left with worthless coins.
Web2 and blockchain don’t mix well at FTX
Almost a month after FTX declared bankruptcy, the collapse of the platform continues to take its toll and its underpinnings are also starting to cause concern.
Indeed, we now learn that the metadata of NFTs hosted at FTX now redirects to a restructuring website providing information about the exchange’s collapse.
The news was revealed by Solana blockchain engineer Jac0xb.sol, who also informs us that FTX was using an API for Web2 use.
Oh look FTX hosted all the NFTs minted on their platform using a web2 API and now all those NFTs have broken metadata and the links go to a restructuring website. pic.twitter.com/hsQgVru4BL
– jac0xb.sol (Yaʿaqov) (@jacobdotsol) December 7, 2022
“Oh look, FTX hosted all the mint NFTs on their platform using a Web2 API and now all these NFTs have corrupted metadata and the links go to a restructured website […] There’s a lesson to be learned here, but the collections are still hosting the metadata on AWS. “
Here, Jac0xb is referring to Amazon Web Services, the cloud computing service of the giant Amazon. Indeed, it may be interesting to measure the relevance of hosting NFT on a totally centralized solution, such as Google Cloud or Microsoft Azure, while totally decentralized solutions exist today to meet this type of need.
NFTs are simply unusable
So users affected by this unfortunate news are left with NFTs with corrupted metadata, which is the essential component of an NFT, especially when it is intended to provide added value, as is the case with the “Coachella: Desert Reflections” collection.
This collection joins a set of 3 NFT ranges launched by the Coachella festival last February, each offering different rewards, including lifetime access to the festival for the most expensive. In total, these 3 collections were able to raise no less than 1.5 million dollars.
And yet, today, this is what the NFTs in question look like:
Although FTX users had the option of leaving their NFTs hosted directly on the platform, they could also transfer them to an external wallet. However, the metadata itself is corrupted, so unfortunately this will not save them.
This news will not help to provide the impetus the NFT market needs, as the market is currently seeing the lowest daily trading volume, with the equivalent of $25 million traded on the whole day of December 7.
NFT volume traded over the last 12 months (in pink)
