NFTs hosted on the FTX platform were impacted by the firm’s collapse

SNEAK PEEK

  • The recent FTX collapse has brought several flaws in the crypto industry to the surface, and the effects of the FTX fall have broken into the NFT space.
  • NFT owners are not able to see the image associated with their NFTs, even when they are viewing them within wallets.
  • Executives suggested that it is crucial for the NFT community to concentrate on bringing more utility to their collections.

In a recent revelation, it has come to light that the NFTs hosted on the FTX platform have been affected by the company’s collapse. This is because they are showing blank images in place of the original art. Well, this highlights yet another flaw in the crypto industry caused by manipulative large players.

Example of an NFT hosted by FTX
Example of an NFT hosted by FTX. Source: Magiceden

As revealed in a tweet by a Solana engineer, the metadata of FTX-hosted NFTs points to a restructuring website that provides information and data regarding the bankruptcy proceedings. In accordance with what he revealed, the NFTs minted on the FTX exchange were hosted utilizing a Web2 application programming interface, which is why images are not showing. 

Following the fall of the FTX exchange and the firm filing for bankruptcy, the FTX.US domain got redirected to the bankruptcy proceedings page. This was the main reason why NFT owners were still able to see that their NFTs were still in existence. 

However, owners are not able to see the images, even when they are trying to view them within wallets or listing them on the NFT trading platforms

The Solana engineer called out collections persistent in holding metadata on Amazon Web Services and suggested that FTX hosting their NFTs using a Web2 API service is a lesson to be learned. 

In addition to this, there were some users who commented that this highlighted problems with Web3 firms depending on centralized services such as the Google Cloud Platform and AWS.