Sam Bankman-Fried’s FTX exchange once again made headlines, immediately after it launched its NFT minting feature, and not for good reasons. The exchange that wanted to expand into the artistic marketplace recently discovered that there are more than a few willing to exploit free access to NFT minting. As a result, FTX had to urgently introduce a $10 paywall behind the feature, in order to discourage spammers.
FTX brought the new feature yesterday, September 6th, which is also when its CEO, Sam Bankman-Fried announced it via Twitter. He even posted a link to the first NFT that served as an example, simply featuring a word TEST written on the white background. The exchange’s first NFT attracted a total of 60 bids by now, with the highest bid being $200,000.
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The thread further revealed that the NFTs will be cross-chain compatible with Solana (SOL/USD) and Ethereum (ETH/USD) and that deposits and withdrawals will arrive in a few weeks. Since then, outside NFTs are also expected to be available for storing on the platform.
Spammers force the exchange to put up an entry barrier
The problem, however, is that the feature was left open to abuse, and it was abused pretty much as soon as it was revealed. It took about seven hours following Bankman-Fried’s announcement that he returned to Twitter with another post, stating that the amount of submissions that the platform received was over the top.
There were just too many submissions with images of the fish, which was quickly characterized as spam. The exchange had to react quickly, and it introduced a one-time $500 fee for first-time NFT submissions. The move caused a major backlash from the community, with many saying that this is an extremely expensive barrier just to gain entry. Some even pointed out that it would be cheaper to go and mint on Ethereum, which is known for high fees these days.
So, to satisfy the community, FTX quickly removed the $500 entry fee, and instead, it implemented a $10 fee per NFT. This will discourage spam, while regular users will still find it affordable. So far, it appears that it worked well enough, and the community seems to be satisfied with the speed at which the exchange handled the situation, as well as the way it did it.
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