Original CryptoPunks Contract Bug Allowed 80+ Exploitative Transactions, Fueling V1 vs. V2 Debate

A long-standing controversy surrounding the authenticity of early CryptoPunks, particularly the "V1" tokens, has been brought to light through a recent social media post by NFT collector Sov. The discussion centers on a critical bug in the original 2017 CryptoPunks smart contract that allowed buyers to acquire NFTs without payment, and the subsequent efforts by some early holders to promote these "bugged" V1 tokens as the true originals. This historical context reveals a complex interplay of technical flaws, market dynamics, and community narratives within the nascent NFT space.

The initial CryptoPunks V1 contract, deployed in June 2017, contained a significant flaw: the offerpunkforsale method allowed a buyer to receive the CryptoPunk while simultaneously withdrawing their Ethereum, leaving the seller uncompensated. Larva Labs, the creators of CryptoPunks, swiftly identified this issue. To rectify the problem, they released a new, corrected contract, known as V2, and airdropped the V2 Punks to the original V1 holders, effectively deprecating the V1 contract for official trading.

Despite the V2 contract becoming the recognized standard, the V1 tokens persisted on the blockchain. According to Sov's tweet, a campaign emerged prior to the 2021 NFT boom, led by certain large punkholders who had previously sold their V2 Punks, to promote these V1s as the "authentic version." The tweet further alleges that the individual who exploited the V1 bug most frequently, acquiring dozens of Punks without payment, later became a prominent advocate for the V1 narrative. Historical records indicate approximately 80 CryptoPunks were affected by this exploit, with a significant portion attributed to a single large claimer, Hemba.

"Before the 2021 NFT boom, some large punkholders (1000+ punks claimed) sold all / most of their punks — mostly below 3 ETH. But they still had 1000+ bugged contract tokens (”v1s”). A campaign was started to promote the “v1s” as the authentic version (“the originals”)."

The resurgence of V1 Punks in early 2022, facilitated by community-built "wrappers" that enabled their safe trading on modern marketplaces, intensified the debate. While some view V1s as valuable historical artifacts, others, including CryptoPunks V2 holders and some original creators, consider them voided or unofficial. Yuga Labs, which acquired the CryptoPunks IP from Larva Labs, currently recognizes only the V2 contract for commercial rights and has stated no immediate plans for the V1 collection.

Sov, who disclosed owning 144 Punks and 108 V1s, emphasized the importance of understanding this history. "I know how it started, how it unfolded, and the motivation behind promotion of the 'v1s'," Sov stated, highlighting the need for transparency regarding the origins and evolution of significant digital assets. This ongoing discussion underscores the complexities of provenance, authenticity, and community consensus in the rapidly evolving landscape of blockchain-based collectibles.