Given that it is being sued for its allegedly stolen NFT policy, OpenSea is now sailing through some difficult waters. Jesse Halfon, an advocate for NFTs and DAOs, filed the case.
The platform’s somewhat frustrating approach of handling stolen NFTs has long infuriated users, and it appears that the unhappiness has reached a tipping point. With the lawsuit looming big, OpenSea will likely need to reevaluate its approach. Follow along to learn more.
The What and Why
Despite their popularity, NFTs have their own set of issues and problems. The extent of difficulties brought on by stolen NFTs is hard to fathom. Attorney Jesse Halfon has launched a lawsuit against OpenSea, the NFT marketplace, over its handling of allegedly “stolen” NFTs. This OpenSea policy has generated a great deal of user resentment and has been the subject of close study several times.
The guideline stipulates that selling stolen NFTs on the OpenSea platform is prohibited. However, because the NFTs are restricted, the policy also prevents users from selling them. This is owing to the fact that prior owners have locked their NFTs after reporting them as stolen.
Despite not taking part in the theft, this presents problems for the existing owners because they are unable to sell their NFTs. The small claims court was used to file the action. If additional customers sign up for the case, it may develop into a class action lawsuit. However, in accordance with OpenSea’s conditions,
“All claims and disputes within the ambit of the arbitration agreement shall be arbitrated only on an individual basis, without resort to any kind of class arbitration or representative arbitration.” This might put a stop to a class action lawsuit. Halfon, though, remains optimistic. Although the terms make a class action lawsuit more challenging, he claimed that it is still doable.