About The Balloonsville Rug Pull At Magic Eden

Here we examine the sales volume and price trends for the Balloonsville secondary market since February 5th. What is the average selling price of Balloonsville NFTs over the same time period?

Balloonsville Rug Pull

Crypto companies and mainstream financial institutions utilize the term “rug pull” all over the crypto industry and mainstream finance, especially within the DeFi sector, to describe a lot of disastrous situations that can occur in cryptocurrency and other forms of decentralized finance that can lead to extreme losses for investors.

Balloonsville appears to be a very popular NFT project, based just on secondary sales on Magic Eden. There have been more secondary sales than balloons minted (5000) in the first few days after launch.  Suddenly 16-24 hours after the near instant sell-out mint of Balloonsville , Balloonsville’s account wrote a series of tweets about how Magic Eden, a marketplace owned by Solana, didn’t even bother to verify the team’s identity. In addition, the team admitted they did not adhere to Solana’s protocols and did not provide proof of concept. And the founder decided to loudly announce Balloonsville was a rug and decided to start trolling Magic Eden.

It was expected that prices of Balloonsville NFTs sold on the secondary market would drop drastically following the announcement of the rug. As a result, the price of NFT has dropped by more than 90% in a matter of hours. Over the weekend, the price rose as high as 4.3 SOL, but after the rugpull, the price plummeted to around 0.1 SOL . Magic Eden posted on its Twitter account that it would refund users whose balloons have been sold below the mint price of 1 SOL (US$118), but not those who bought after the mint and then sold them at a loss.

https://twitter.com/MagicEden_NFT/status/1490552178205159428?s=20u0026t=dclFCfiuGZJgNt2ryhS7EA

The price of these NFTs made a slight increase again following the derugging announcement by Magic Eden. From the below tweet we can see the Magic Eden’s Debugging announcement and their decisions.

https://twitter.com/MagicEden_NFT/status/1490551580193878016?s=20u0026t=AEpSvUpJciKynyjf9wKk8g

Balloonsville Secondary Sales Volume And Transaction On Magic Eden

In the graph below, we can see the daily volume of secondary sales for Ballonville on Magic Eden. On February 5, 2022, there was a maximum volume(usd) of $1.13M. From February 5, 2022 to February 21, 2022, the total volume (USD) decreased by more than 95%. On February 8, 2022, volume(USD) was lower than normal. Volume(usd) shows a decreasing trend over time.

In the graph below, we show the daily transactions for Balloonsville Secondary sales on Magic Eden. The highest number of transactions, 6,552, was recorded on February 6, 2022.In February 8, 2022, total transactions are lower than normal while in February 6, 2022, total transactions are higher than normal. The number of transactions declined by 98% from 4,393 in February 5, 2022 to 76 in February 21, 2022. Transactions are showing a decreasing trend.

Balloonsville Secondary Sales Avg. Sales Price On Magic Eden

In the below graph we can see the secondary sales average price for Balloonsville on Magic Eden for Feb 5,6,7, and 8 of 2022. On February 6, 2022, at 8:00 a.m., we can see the maximum sale price 4.1 of Balloonsville NFT, but within a few hours it changes to a 0.2 sale price at 15:00. On their site, the rug pull was noticed. After a brief tweetstorm, the rug pull was accepted as their responsibility, and it was announced through the site that it would be dug up and are going to derugging on some conditions. With the announcement by Magic Eden of derugging, the average sale price is increasing.

Magic Eden earns commission on a daily basis as shown here. There were 74,36K in total Magic Eden Commissions (USD) from February 5, 2022 to February 21, 2022.

Can see from the graphs below how the number of Paper hands is distributed as a percentage of their losses. The top two loss categories (50-60% losses and 70-80% losses) accounted for 40.7% of total sales. ‘More than 90% Loss’ represents the lowest total Sales, while ‘50% – 60% Loss’ represents the highest total Sales. If we compare the percentage of losses with other losses, we can say that more than 90% loss was less than 1% .

Looking at the day-by-day distribution of paper hands for the 6th of February,2022, we can see that most of the people lost the sale price compared to the 7th. In the below graph, you can also see what kind of losses were experienced on Feb 6, 2022.

Observations

From the above analysis,

  • It can be seen that the maximum sale volume occurred on February 5, 2022, and the total volume (USD) decreased by over 95% between February 5, 2022 and February 21, 2022. Also, the volume of sales was decreasing.
  • As seen on the chart of the number of transactions on Magic Eden on February 6,2022, the highest sale price for Balloonsville NFT’s was 4.1(SOL) on the same day, but suddenly after a couple of hours the sale price was 0.2(SOL).This is a drop of almost more than 90%. This was noticed by rug fall on Balloonsville NFT on Magic Eden.  Due to the announcement by Magic Eden, it would be dug up and derugged under certain conditions. With the announcement by Magic Eden, the average sale price has increased.
  • We can also see the distribution of paper hands the lowest total sales amount is ‘More than 90% Loss’, while the highest total sales amount is ‘50% – 60% Loss’. From this we discovered that the more number of losses ‘ 50-60% losses’ were experienced by most of the Balloonsville NFTs. ‘More than 90% Losses’ of the loss was less than 1% if we compare it with other losses.
  • Based on the distribution of paper hands day by day for the 6th of February,2022, we can see that most people lost their sale price as compared to the 7th February.

Referred From : https://solanart.io/collections/balloonsville

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