Amir Soleymani, also known as mondoir, has filed a UK lawsuit against Nifty Gateway – a marketplace for digital art and collectibles responsible for the sale of the second and third most expensive NFTs ever sold – over an auction for an original Beeple piece Abundance that was eventually sold for $1.2m on Nifty Gateway.
Nifty Gateway hosted an auction which resulted in the highest bidders or ‘winners’ receiving numbered editions of the Beeple Abundance artwork corresponding to the position of their respective bids. Bidders were subsequently required to pay for the ranked editions, although Soleymani’s sole intention was to own the unique, first edition piece. He has therefore challenged Nifty Gateway over whether the Beeple auction was legal or not.
The auction for Abundance took place between 30 April and 2 May 2021, drawing interest from ‘Whales’ – a term used to describe an entity who holds premium NFTs or many coins of a particular cryptocurrency – including Justin Sun, founder of cryptocurrency Tron, and Taylor Gerring, co-founder of the second largest cryptocurrency Ethereum. Abundance was created by Beeple who in March sold an NFT for $69 million at Christie’s – the most expensive NFT ever.
After the Abundance auction closed and Soleymani was the third highest bidder, Nifty Gateway claimed that he’d ‘won’ an edition of the Beeple piece for which he was asked to pay but refused. Nifty Gateway proceeded to freeze his NFT collection on their site, composed of hundreds of thousands of dollars’ worth of NFTs he had bought previously, and the collection remains frozen by Nifty Gateway.
NFTs that are not ‘first edition’ are acknowledged to carry significantly lower value than first editions and it is highly unlikely that a third edition NFT, no matter the provenance of the work, would elicit a bid anywhere near the value of Mr Soleymani’s bid for the first edition of Abundance, if auctioned as an individual lot.
NFTs have developed rapidly as virtual securitisations of art and collectibles, with digital works fetching huge price tags. Between May 2020 and April 2021, total sales of NFTs on Nifty Gateway amounted to roughly $303.8 million overall. Nifty Gateway was acquired by Gemini, a cryptocurrency exchange and custodian founded by Tyler and Cameron Winklevoss. A legal action is now underway in the High Court in London although Nifty Gateway is yet to engage in the process.