Wash Trading Fears Push OpenSea to Suspend XP Reward Program

The non-fungible token (NFT) marketplace introduced the system as part of the beta launch of its updated platform, OS2, on January 28. Users could earn XP points, which would later determine their eligibility for an upcoming SEA token airdrop.

However, many in the community criticized the system, arguing that it encouraged wash trading and favored traders over creators and builders.

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NFT collector @waleswoosh compared OpenSea’s XP system to Blur’s farming mechanics but claimed it was even more aggressive. They pointed out that top traders were repeatedly selling NFTs back and forth to accumulate XP without real financial risk.

Some users shared examples of how much this system was benefiting traders. @stonkrates pointed out that top traders were essentially “wash trading the same NFTs, dumping on each other’s bids to compete for points”.

Aside from trading concerns, others felt the system ignored artists, builders, and creators contributing to the NFT ecosystem. @HelloBenWhite criticized the XP reward system, saying it had “zero consideration” for those groups.

In response to the backlash, OpenSea CEO Devin Finzer announced that XP rewards for listing and bidding would be suspended. Instead, the platform will focus on XP shipments, a new mechanism introduced on February 14.

OpenSea recently denied speculation about rumors of an NFT airdrop. What did Finzer say about it? Read the full story.