OpenSea Halts Trading Of Staked-Ether NFTs, Ether.Fi CEO Responds

Ether.Fi has responded to the suspension of its newly-launched NFT (non-fungible token) collection on OpenSea after the prominent digital marketplace stopped the trading of the staked-ether NFTs, citing its concern about financial activities that require registration and licensing.

OpenSea Halts Trading Of Staked-Ether NFTs

On Tuesday, July 11, liquid staking protocol Ether.Fi launched its NFT collection called Ether.Fan. According to the team, the NFTs in this collection are based on “staked ETH and focused on Ethereum decentralization.”

Mike Silagadze, CEO of Ether.Fi, dubbed the 3,000-NFT collection launch as “wildly successful,” claiming that all the non-fungible tokens were minted within a day, with more than 6,200 ETH staked in the process.

However, OpenSea removed the Ether.Fan collection not long after it started getting listed on its platform. Following this, Ether.Fi claims that it didn’t get a warning, notice, or a reason before its collection was disabled on the marketplace.

Furthermore, Ether.Fi CEO revealed in an open letter that his team reached out to OpenSea immediately through multiple channels but received no reply within the first few days. The protocol later got a “form letter” response, with the marketplace explaining the reason behind their action.

According to the open letter, OpenSea said it doesn’t permit NFT collections that “carry out financial activities subject to registration or licensing.”

Ether.Fi CEO Criticizes OpenSea In Open Letter

On Tuesday, in an open letter published on Medium, Mike Silagadze criticized OpenSea’s decision to halt the trading of its Ether.Fan NFT collection. The CEO expressed his disappointment, stating that his team didn’t get any notice or warning despite its supposed good relationship with the marketplace.

Silagadze stated that his team was in constant contact with Opensea before the launch of its Ether.Fan collection and this was to ensure that the NFTs “looked right” and were compatible with OpenSea’s platform.

“Through that whole process, we didn’t get any indication that anything we were doing would be an issue. Why would it be? This was frankly an intentionally prosaic non-speculative project in the NFTfi category of utility NFTs,” he also said.

According to the Ether.Fi CEO, the non-fungible tokens in its collection are just wrapped staked Ether with a PFP. The protocol’s executive believes that, with this action, OpenSea is taking a conservative “stance that staked ETH is subject to licensing and registration.”

Interestingly, Silagadze fired a direct shot at OpenSea, calling the marketplace a “de facto unlicensed casino where people engage in ruinous gambling and spend millions on pictures of monkeys.”

“This is all great and ok apparently, but listing a collection that actually has utility is disallowed because it has utility,” he added.

While the EtherFan collection is currently still not listed on OpenSea, it is available on Rarible, with a floor price of 0.12 ETH.

ETHUSD trading at $1,908 | Source: ETHUSD chart from TradingView