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Twitter Most Famous NFT Loses 99.9% Of Its Value In The First Day Of Its Launch

And Why We Should Not Care About NFTs

By Kralik MiroslavPublished 2 years ago 3 min read
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Twitter Most Famous NFT Loses 99.9% Of Its Value In The First Day Of Its Launch
Photo by Maxim Hopman on Unsplash

After buying the NFT for over $2.9 million, hoping to get a dream-like return on his investment, crypto entrepreneur Sina Estavi tries to sell his valuable first-ever tweet NFT for a whooping $48 million and gets rolled. Buyers have had no interest in the NFT whatsoever and it lost its value almost immediately when the highest bid at the auction was 280$.

Sina Estavi was wishfully thinking that he could sell the NFT for a price that’s magnified by 17000% so that he could give half of its price, $25 million, to charity. News is, you would still keep a profit of 8500%, which is ridiculous given that he didn’t add any more value to an NFT that has no value in the first place.

Moreover, Estavi has a criminal record. He was arrested in his home country Iran last year and charged with “disrupting the economic system” following his controversial crypto project CryptoLand, which is a plan to buy a private island for only crypto geeks to live at and pursue their “crypto passion.” Estavi was forced to close the project by the Iranian authorities.

“Estavi’s arrest certainly played a role in the auction results,” says Merav Ozair, an NFT expert and financial technology professor at Rutgers University. “Some people in the crypto world view Estavi as a semi-criminal because he’s now looking for money to repay the investors of CryptoLand,” Ozair said.

What This Means For NFT Investors

Run as fast as you can and don’t look back. NFTs, along with meme coins with no fundamental value, are essentially a scam and investing in a scam is the worst thing you could do. In the real world, you can not add value to something without adding effort to justify that addition. In the NFT world, you can create value out of nowhere.

“There’s virtually nothing humans can’t turn into a market. But increasingly there are speculative bubbles in things with absolutely no fundamental value,” says John Hawkins, a professor at the Canberra School of Politics and an expert in finance. “NFTs have joined Bitcoin and celebrity meme-based cryptocurrencies such as Dogecoin and Shiba Inu as examples of tokens with no intrinsic worth, which speculators just buy in the hope the price will keep rising.”

Guess what? It’s almost impossible for the price to keep rising without scamming new people into the market, promising them that huge investors will never do a quick, swift, and smooth rug pull.

Rug Pull Crypto Scams

The most obvious type of crypto scams is rug pulls, and it happens when a content creator or a blockchain developer advertises for a new innovative and state of the art crypto project, promising investors thousands of dollars on their small investments. Most of the time, it will be a new crypto coin that the creators hope people will buy. And they do.

When the coin gathers enough support from investors, the creator starts a process where investors can buy but cannot sell. Soon enough, the creator pulls the rug on the project and steals all the money the coin made by changing it to cash, draining the liquidity pool from the exchange and plummeting the coin’s value to $0.

In a recent crypto scheme, an anonymous group of developers made the coin SQUID, claiming that they are affiliated with the popular show Squid Game when they had no ties to the show whatsoever. The group of scammers managed to get the coin’s value to $2,861 before pulling the rug and escaping with an estimated $3.38 million.

Last year, crypto investors lost over $2.8 billion in rug pull schemes, and if new people continued to enter the crypto industry with the mindset of making quick cash, this number is only going to go higher.

Personally, I have pulled out of every crypto project I have invested in, including popular coins such as Bitcoin. My advice is to re-evaluate how much crypto investments made you, and think if that’s a path you want to continue moving in.

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Kralik Miroslav

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