Non-fungible token (NFT) market OpenSea has paused its new XP reward system following criticism from customers.
On February 13, OpenSea launched the beta model of its upgraded platform, OS2, calling it “a fully reimagined product built entirely from the ground up.” The replace included a brand new factors system that may decide eligibility for an upcoming airdrop of the platform’s native token, $SEA.
Nevertheless, many customers criticized the system, arguing it may encourage wash buying and selling and was designed primarily to generate charges.
In response, OpenSea CEO Devin Finzer addressed the backlash on X (previously Twitter). He wrote, “we’ve heard the feedback on the current XP system, and we’re putting a pause on XP given directly for listing and bidding.”
He added, “I appreciate the feedback. we’ll continue to work closely with those who have helpful ideas. but some of the vitriol I saw on X this weekend appeared to be primarily motivated by extraction / attempts to bring OS down.”
Talks of a “revamped” platform had been circulating since final yr, when Finzer said the workforce would “reimagine everything” and rebuild OpenSea “from the ground up” to enhance safety and ship a extra customized expertise.
To assist the overhaul, OpenSea restructured its operations in 2023, slicing its workforce by as much as 50%. It was the second spherical of main layoffs after a earlier one in 2022.
The platform has confronted rising challenges. In Could 2024, OpenSea’s buying and selling quantity dropped to ranges final seen in April 2021, signaling a decline in NFT market exercise.
Regulatory stress has additionally elevated. In August 2024, the SEC issued OpenSea a Wells discover, suggesting that NFTs bought on the platform could be categorised as securities.
Authorized points adopted. In September 2024, two customers filed a class-action lawsuit accusing OpenSea of promoting unregistered securities. Nevertheless, the lawsuit ended when each customers withdrew their claims after OpenSea invoked binding arbitration.
