OpenSea is an American non-fungible token (NFT) marketplace headquartered in New York City. The company was founded by Devin Finzer and Alex Atallah in 2017.[2][3]
 | |
| Company type | Private |
|---|---|
| Founded | 2017 |
| Headquarters | |
Area served | Worldwide |
Key people |
|
| Website | opensea |
OpenSea offers a marketplace online allowing for non-fungible tokens to be sold directly at a fixed price, or through an auction.
History
Devin Finzer and Alex Atallah founded OpenSea in December 2017.[4] They were inspired by CryptoKitties, a blockchain-based game featuring non-fungible tokens that had been released earlier that year.[4] Finzer and Atallah believed that OpenSea could be a marketplace for buying NFT tokens like those.[4] Y Combinator accepted OpenSea into its accelerator program in 2018,[4] and in an announcement described the startup as a "peer-to-peer marketplace for cryptogoods".[5]
After finishing the pre-seed round by Y Combinator, OpenSea raised $2.1 million in venture capital in November 2019.[6]
In March 2020, the platform had 4,000 active users completing $1.1 million in transactions a month.[7] By July 2021, users were completing $350 million in transactions a month,[7] and the company was valued at $1.5 billion—meaning unicorn status—after a $100 million Series B venture round led by Andreessen Horowitz.[8] In August 2021, the value of monthly transactions spiked to $3.4 billion, and in November OpenSea had 1.8 million active users.[7]
On September 14 of that same year, Nate Chastain, the then-head of product at OpenSea, was accused of insider trading after it was revealed that he bought NFTs shortly before they were showcased on OpenSea's front page, subsequently selling them at higher values.[9][10] The next day OpenSea acknowledged the accusations and launched an internal review.[9] On September 16, OpenSea announced that Chastain had resigned.[11] In May 2023, Chastain was convicted of wire fraud and money laundering in federal court and later sentenced to three months in prison.[12]
In January 2022, the company was valued at $13.3 billion and was described by The New York Times as being "one of the most talked-about blockchain start-ups in Silicon Valley".[13] The daily trading volume on the OpenSea marketplace reached $2.7 billion on May 1, 2022, but four months later had dropped by 99%.[14][15]
In January 2022, OpenSea acquired Ethereum wallet-maker Dharma Labs.[16]
Later that month, OpenSea reimbursed users about $1.8 million after a user interface bug allowed users to buy more than $1 million worth of NFTs at a discount.[17][18]
On January 27, 2022, OpenSea announced it would limit how many NFTs a user could create using the free minting tool.[19] The following day, OpenSea reversed the decision.[20] The company stated that its initial decision was based on concern about theft, plagiarism, and spam,[19] as 80% of the NFTs removed from OpenSea for violations were minted using the tool.[21]
On February 19, 2022, some users began to report that some of their NFTs disappeared. OpenSea later revealed a phishing attack had taken place on its platform via an exploit in the Wyvern Platform.[22] The next day, The Verge reported that hundreds of NFTs were stolen from OpenSea users causing a huge panic among the platform community. The estimated value of the stolen tokens was more than $1.7 million. According to OpenSea, only 32 users had been affected. OpenSea later revised its statement to note that 17 users were directly affected, while the other 15 users had interacted with the attacker but had not lost tokens as a result.[23]
In March 2022, OpenSea confirmed that it was blocking accounts in countries that are subject to United States sanctions.[24]
On April 25, 2022, OpenSea announced the acquisition of the NFT marketplace aggregator company Gem.xyz.[25]
On June 30, 2022 OpenSea reported a major email data breach had occurred when a senior engineer at an email vendor, Customer.io, misused his employee access to download and share OpenSea user email addresses with an "external bad actor." Over 1.8 million email addresses are said to have been leaked.[26] In July 2022, Customer.io revealed that five other companies were also impacted by the employee's data leak.[27]
On July 14, 2022, chief executive Devin Finzer tweeted that the company was cutting one in five of its employees.[28][29]
The daily volume of NFT transactions on OpenSea peaked at $2.7 billion on May 1, 2022, but then dropped by 99% within four months to just $9.34 million on August 28, with daily users down a third to 24,020.[30]
Funding
| Date | Amount (millions of $) | From | Notes |
|---|---|---|---|
| 2018[31] | Y Combinator, Animoca Brands | Pre-seed round | |
| November 2019[31] | 2.1 | Multiple sources | |
| March 2021[32] | 23 | Andreessen Horowitz, others | Series A |
| July 2021[33] | 100 | Andreessen Horowitz, others | Series B; valued at $1.5 billion |
| January 2022[34][35] | 300 | Paradigm and Coatue Management, others | Series C; valued at $13.3 billion |
Features
In December 2020, OpenSea announced that any user could mint NFTs on its platform for free. Later, in March 2021, OpenSea announced NFT collections would not need to be approved to be listed; this decision was later criticized for allowing rampant plagiarism on the platform.[36]
On September 17, 2021, OpenSea released an app for Android and iOS. The app allows for browsing the marketplace, but as of March 2023, the app does not allow buying or selling NFTs.[37][38]