Yuga Labs To Offer Gas Refunds After ‘Otherside’ NFT Mint Burned $157 Million in ETH

May 04, 2022, 10:45 AM AEST - 2 weeks ago

ApeCoin (APE), the governance token of the Bored Ape Yacht Club (BAYC), has plunged as much as 11 percent after a catastrophic NFT sale by Yuga Labs.

Single NFT Collection Shuts Down Ethereum

The price drop came shortly after Yuga Labs (the company behind BAYC) made over US$550 million with the sale of “Otherdeeds“, a new Ethereum-based NFT collection that’s part of the Otherside metaverse.

However, the sale came with a few problems. The NFTs sold at a fixed price of 305 ApeCoin, or roughly US$7,000 each, but the high demand congested the Ethereum network to the point of rendering it practically useless:

Up to $14k in Gas Fees

Users reported paying gas fees from up to US$9,000 to $14,000, while others saw their transactions declined as a result of high network traffic. Yuga Labs said it would refund gas to affected users, but didn’t disclose when:

Over 71,000 ETH – approximately US$200 million at time of writing – was paid in gas fees, a new record for the Ethereum network. Fees were burned or destroyed, taking $200 million in liquidity out of the market.

While Ethereum gas fees are back to their usual levels, the price of ApeCoin dropped sharply after the event. At press time APE was trading at $14.19, down 4 percent from its recent weekly high, and trading volumes are still in the red with a 34.81 percent drop.

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