MekaVerse NFT Minting Fraud Accusation

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MekaVerse

MekaVerse launched a set of 8,888 NFTs which were supposedly randomly generated. All NFTs were bought at a constant market price, since no one knew how rare they would be. Controversy ensued when one of the rarest NFTs had been bought by one of the project developers, who was accused of having inside information into the random generation algorithm.

The evidence to support the allegations appears weak. Only one NFT was luck. A malicious developer could easily have picked one of 15 NFTs that were rarer or repeated their trick multiple times. In the end, the NFT in question was sold with the proceeds donated to charity.

This is a global/international case not involving a specific country.

About MekaVerse

"In the distant future, drivers fight in a world divided into 4 Factions. Originals Meka, Mirage, F9, and Gadians are the Titans who rule this planet." "The MekaVerse is a collection of 8,888 generative Mekas inspired by the Japanese Anime universe." "Each MekaVerse NFT holder has access to exclusive events on Discord, Twitter, and more. The Mekaverse does not stop at one planet, it extends far beyond that!"

"MekaVerse is an Ethereum-based collection of 8,888 randomly generated avatars and started on July 10th. Investors who buy NFTs don’t know exactly which images they bought. It’s like an IOU (proof of loan): Owners see a placeholder image in front of a collection start planned for later days. Even the secondary market buyers do not know what they are getting."

"When MekaVerse—an Ethereum-based collection of 8,888 randomly-generated profile pictures—held its minting process on October 7, the new NFT owners didn’t immediately know which image they had bought. It was like an IOU: holders saw a placeholder image ahead of a planned collection-wide reveal days later. Even secondary market buyers didn’t know what they were getting."

"Every image on OpenSea looked the same in the meantime, and secondary prices soared as users took a trading card pack-like gamble on possibly pulling a rare, especially valuable image. Ahead of the launch, unrevealed MekaVerse NFTs had an average sale price above 7.1 ETH, or about $25,000 at the time."

"Rather, buyers shouldn’t have known what they were buying. However, since the launch, a number of allegations have surfaced on social media suggesting that some buyers may have had early access to the metadata, or the information that describes which attributes each NFT image contains. That data could have been used to purchase rare NFTs, sight unseen."

"Twitter user MOLOTOV accusations MekaVerse launch event is “cheating”. He points to public data from OpenSea and other sources showing that one of the project’s developers, Wyb0 from Miinded Studio, “played around” buying rare NFTs at a bargain price before they were even revealed."

"In a viral tweet thread, Twitter user MOLOTOV accused the MekaVerse launch of being “rigged.” They highlighted public data from OpenSea and other resources that suggest one of the developers on the project, Wyb0 from Miinded Studio, managed to purchase one of the rarest NFTs around the average going price before the reveal."

"The @MekaVerse reveal was rigged: yesterday, @_Wyb0 bought Meka #6764 for 6.83ETH. Guess what?" "Meka #6764 is ranked #16 in rarity. How could @_Wyb0 have known this yesterday?" "@_Wyb0 is the co-founder of @MiindedStudio who collaborated with @MekaVerse for the launch of the collection. Does this need more explanation?" "Yesterday, @_Wyb0 already knew the rarity traits of each Meka and exploited this information to purchase for a cheap price a rare Meka. How fair is this?"

"In other words, metadata can leak in the time between the imprint and the publication of the image a few days later. These disclosures were used to purchase a number of MekaVerse NFTs – which could become much more valuable after their announcement."

"Decrypt reached out to the MekaVerse team on Thursday, including directly to co-creators Matt Braccini and Mattey, but did not hear back from any of them."

"On Thursday, the creators addressed the allegations in an announcement post via its public Discord server. According to the team, the reveal process included a custom Python script to aid with randomization, along with a seed system for regenerating the order if needed. It also used a private server, not on a blockchain, to complete the randomizing process."

“It allows us to safely randomize everything on our side, which was done solely to avoid any security issues and to have something clear and controlled,” the team wrote.

“To avoid any risk of leakage or cheating, our team kept the secret until the very last moment of the reveal date,” it continued. “We performed the final randomization just before the reveal to ensure that nothing leaked and that everything was distributed clearly, fairly, and randomly.”

"Wyb0—the aforementioned Miinded Studios developer accused of using inside information to buy a rare MekaVerse NFT—tweeted about his purchase, saying that it happened before the MekaVerse creators “​​sent the metadata and final images” to Miinded. In any case, apparently due to the controversy, the NFT in question will be auctioned off for charity."

This is a global/international case not involving a specific country.

The background of the exchange platform, service, or individuals involved, as it would have been seen or understood at the time of the events.

Include:

• Known history of when and how the service was started.
• What problems does the company or service claim to solve?
• What marketing materials were used by the firm or business?
• Audits performed, and excerpts that may have been included.
• Business registration documents shown (fake or legitimate).
• How were people recruited to participate?
• Public warnings and announcements prior to the event.

Don't Include:

• Any wording which directly states or implies that the business is/was illegitimate, or that a vulnerability existed.
• Anything that wasn't reasonably knowable at the time of the event.

There could be more than one section here. If the same platform is involved with multiple incidents, then it can be linked to a main article page.

The Reality

This sections is included if a case involved deception or information that was unknown at the time. Examples include:

• When the service was actually started (if different than the "official story").
• Who actually ran a service and their own personal history.
• How the service was structured behind the scenes. (For example, there was no "trading bot".)
• Details of what audits reported and how vulnerabilities were missed during auditing.

What Happened

The specific events of the loss and how it came about. What actually happened to cause the loss and some of the events leading up to it.

Key Event Timeline - MekaVerse NFT Minting Fraud Accusation

Date	Event	Description
October 14th, 2021 9:43:00 AM MDT	Main Event	Expand this into a brief description of what happened and the impact. If multiple lines are necessary, add them here.

Technical Details

This section includes specific detailed technical analysis of any security breaches which happened. What specific software vulnerabilities contributed to the problem and how were they exploited?

Total Amount Lost

The total amount at risk has been estimated at $8,000,000 USD. No funds were lost.

How much was lost and how was it calculated? If there are conflicting reports, which are accurate and where does the discrepancy lie?

Immediate Reactions

How did the various parties involved (firm, platform, management, and/or affected individual(s)) deal with the events? Were services shut down? Were announcements made? Were groups formed?

Ultimate Outcome

What was the end result? Was any investigation done? Were any individuals prosecuted? Was there a lawsuit? Was any tracing done?

Total Amount Recovered

There do not appear to have been any funds recovered in this case.

What funds were recovered? What funds were reimbursed for those affected users?

Ongoing Developments

What parts of this case are still remaining to be concluded?

General Prevention Policies

Randomized NFT or token launches should source their randomness from a source which is out of the control and predictability of any individual or group. Having a neutral third party to validate the fairness of the random launch can limit the possibility of rigging.

Individual Prevention Policies

No specific policies for individual prevention have yet been identified in this case.

For the full list of how to protect your funds as an individual, check our Prevention Policies for Individuals guide.

Platform Prevention Policies

Policies for platforms to take to prevent this situation have not yet been selected in this case.

For the full list of how to protect your funds as a financial service, check our Prevention Policies for Platforms guide.

Regulatory Prevention Policies

No specific regulatory policies have yet been identified in this case.

For the full list of regulatory policies that can prevent loss, check our Prevention Policies for Regulators guide.