OpenSea

OpenSea is an American non-fungible token (NFT) marketplace headquartered in New York City. The company was founded by Devin Finzer and Alex Atallah in 2017.[2][3]

OpenSea
TypePrivate
Founded2017
Headquarters
United States
Area served
Worldwide
Key people
Websiteopensea.io

OpenSea offers a marketplace online allowing for non-fungible tokens to be sold directly at a fixed price, or through an auction.

In 2021, following a heightened interest in non-fungible tokens, the company's revenue reached $95 million in February and $2.75 billion in September of that year. By January 2022, the company had been valued at $13.3 billion and was described as the largest non-fungible token marketplace.[4][5] The daily trading volume on the OpenSea marketplace reached a record $2.7 billion on May 1, 2022, but four months later had dropped by 99%.[6][7]

History

In 2017, Devin Finzer and Alex Atallah, Inspired by the release of CryptoKitties, founded OpenSea.[2]

In September 2021, OpenSea admitted that an employee engaged in insider trading. OpenSea's Head of Product hoarded NFTs just before they were featured on the homepage.[8]

After a 2018 pre-seed round by Y Combinator, OpenSea raised $2.1 million in venture capital in November 2019. In March 2021, the company raised $23 million in venture capital; four months later the company announced another investment round of $100 million making it a unicorn.[9]

In January 2022, OpenSea acquired Ethereum wallet-maker Dharma Labs.[10]

Later that month, OpenSea reimbursed users about $1.8 million after a user interface bug allowed users to buy more than $1 million worth of NFTs at a discount.[11][12]

On January 27, 2022, OpenSea announced it would limit how many NFTs a user can create using the free minting tool.[13] The following day, OpenSea reversed the decision following user backlash and later admitted that 80% of NFTs created with the tool were plagiarism or spam.[14][15]

On February 19, 2022, some users began to report that some of their NFTs disappeared. OpenSea later revealed a phishing attack had taken place on its platform via an exploit in the Wyvern Platform.[16] The company denied rumors the source of the theft was its website, its listing systems, emails from the company, or an upgraded contract system. The next day, The Verge reported that hundreds of NFTs were stolen from OpenSea users causing a huge panic among the platform community. The estimated value of the stolen tokens is more than $1.7 million. According to OpenSea, only 32 users had been affected. OpenSea later revised its statement to note that 17 users were directly affected, while the other 15 users had interacted with the attacker but had not lost tokens as a result.[17]

In March 2022, OpenSea announced that it would block accounts subject to United States sanctions.[18]

On April 25, 2022, OpenSea announced the acquisition of the NFT marketplace aggregator company Gem.xyz.[19]

In June 2022, former OpenSea product manager Nathaniel Chastain was charged with wire fraud and money laundering in connection with an insider trading scheme of digital assets.[20][21] On May 3, 2023 Chastain was convicted of both charges.[22]

On 30 June 2022 OpenSea reported a massive email data breach after a Customer.io staff member misused his employee access to download and share the email addresses of OpenSea's users. Over 1.8 million email addresses are said to have been leaked.[23]

On 14 July 2022, chief executive Devin Finzer tweeted that the company was cutting one in five of its employees.[24][25]

The daily volume of NFT transactions on OpenSea peaked at $2.7 billion on May 1, 2022, but then dropped by 99% within four months to just $9.34 million on August 28, with daily users down a third to 24,020.[26]

Funding
Funding rounds
DateAmount
(millions of $)		FromNotes
2018[27] Y Combinator, Animoca Brands Pre-seed round
November 2019[27] 2.1 Multiple sources
March 2021[28] 23 Andreessen Horowitz, others Series A
July 2021[29] 100 Andreessen Horowitz, others Series B; valued at $1.5 billion
January 2022[30] 300 Paradigm and Coatue Management, others Valuation at $13.3 billion

Features

In December 2020, OpenSea announced that any user can mint NFTs on its platform for free. Later, in March 2021, OpenSea announced NFT collections would not need to be approved to be listed; this decision was later criticized for allowing rampant plagiarism on the platform.[31]

On September 17, 2021, OpenSea released an app for Android and iOS. The app allows for browsing the marketplace, but as of March 2023, the app does not allow buying or selling NFTs.[32][33]

References
  1. "Long-time Lyft CFO departs to become CFO at NFT marketplace OpenSea". 6 December 2021.
  2. Ehrlich, Steven (6 July 2021). "NFT Marketplace CEO Explains Why The Industry Is Moving Beyond Ideological Purists". Forbes. Retrieved 29 November 2021.
  3. Adams, Luca (22 March 2020). "OpenSea is the world's first and largest NFT marketplace". OpenSea. Retrieved 18 June 2021.
  4. "NFT kingpin OpenSea lands monster $13.3B valuation in new raise". TechCrunch. 5 January 2022. Retrieved 2022-04-30.
  5. Isaac, Mike (2022-01-05). "OpenSea valued at $13.3 billion in new round of venture funding". The New York Times. ISSN 0362-4331. Retrieved 2022-04-30.
  6. "Trading volume on top NFT marketplace OpenSea down 99% since May". Fortune Crypto. Retrieved 2023-03-22.
  7. "NFT marketplace OpenSea's trading volume nosedives 99%. Is the bubble bursting?". Music Business Worldwide. 2022-09-05. Retrieved 2023-03-22.
  8. "OpenSea admits insider trading of NFTs it promoted". BBC. 16 September 2021. Archived from the original on 7 January 2022. Retrieved 15 January 2022.
  9. Matney, Lucas (2021-07-20). "NFT market OpenSea hits $1.5 billion valuation". TechCrunch. Retrieved 2023-03-22.
  10. "OpenSea acquires ethereum wallet Dharma Labs as the NFT marketplace's trading boom continues after landmark 2021". uk.news.yahoo.com. Retrieved 2022-01-18.
  11. Egkolfopoulou, Misyrlena (2022-01-28). "OpenSea reimburses users $1.8 million after bug led them to sell NFTs at a discount". Fortune. Retrieved 2022-01-28.
  12. Faife, Corin (2022-01-24). "An OpenSea bug let attackers boss Apes from owners at six-figure discounts". The Verge. Retrieved 2022-01-28.
  13. Mattei, Shanti Escalante-De (2022-01-28). "After Announcing NFT Limit, OpenSea Reverses Course Amid User Uproar". ARTnews.com. Retrieved 2022-01-28.
  14. "Over 80 percent of NFTs minted for free on OpenSea are fake, plagiarized or spam". Engadget. Retrieved 2022-02-02.
  15. "More Than 80% of NFTs Created for Free on OpenSea Are Fraud or Spam, Company Says". www.vice.com. Retrieved 2022-02-02.
  16. McCarthy, Adam Morgan. "OpenSea confirms hackers made $1.7 million on NFTs stolen in a phishing attack at the weekend". Markets Insider. Retrieved 2023-03-22.
  17. "$1.7 million in NFTs stolen in apparent phishing attack on OpenSea users". The Verge. 20 February 2022. Retrieved 2022-02-20.
  18. "OpenSea users find out that even 'decentralized' internet has to obey sanctions". Fortune. Retrieved 2022-03-06.
  19. Ramaswamy, Anita (25 April 2022). "NFT aggregator Gem.xyz acquired by OpenSea shortly after ousting co-founder for sexual misconduct". TechCrunch. Retrieved 2022-04-26.
  20. "Former OpenSea employee arrested, charged with NFT insider trading". NBC News. Retrieved 2 June 2022.
  21. "Disgraced OpenSea manager arrested for insider trading". The Verge. June 2022. Retrieved 2 June 2022.
  22. Cohen, Luc (2023-05-03). "Ex-OpenSea manager convicted in NFT insider trading case". Reuters. Retrieved 2023-05-12.
  23. "NFT giant OpenSea reports major email data breach". TechCrunch. 30 June 2022. Retrieved 2022-06-30.
  24. "FT Cryptofinance: Celsius's fall into bankruptcy and the future of crypto". Financial Times. 2022-07-15. Retrieved 2023-04-06.
  25. Richard Lawler (July 14, 2022). "Giant NFT marketplace OpenSea lays off about 20 percent of its staff". The Verge.
  26. Quiroz-Gutierrez, Marco (2022-08-29). "Trading volume on top NFT marketplace OpenSea down 99% since May". Fortune. Archived from the original on 2022-08-29. Retrieved 2022-09-10.
  27. Finzer, Devin (9 November 2019). "Bringing on additional strategic investors to OpenSea". OpenSea. OpenSea. Retrieved 29 November 2021.
  28. Matney, Lucas (18 March 2021). "NFT marketplace OpenSea raises $23 million from a16z". TechCrunch. TechCrunch. Retrieved 29 November 2021.
  29. Matney, Lucas (20 July 2021). "NFT market OpenSea hits $1.5 billion valuation". TechCrunch. TechCrunch. Retrieved 29 November 2021.
  30. Isaac, Mike (4 January 2022). "OpenSea valued at $13.3 billion in new round of venture funding". The New York Times. Archived from the original on 10 January 2022. Retrieved 15 January 2022.
  31. Volpicelli, Gian M. "Why OpenSea's NFT Marketplace Can't Win". Wired. ISSN 1059-1028. Retrieved 2022-02-11.
  32. Silberling, Amanda (17 September 2021). "OpenSea released an app — but it's for browsing, not buying and selling". TechCrunch. TechCrunch. Retrieved 29 November 2021.
  33. Campbell, Ian (20 September 2021). "OpenSea has an app, but you can't buy NFTs on it". The Verge. The Verge. Retrieved 29 November 2021.
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