Everyone has an NFT or two they regret. This is simply the nature of the NFT ecosystem. Sometimes rock bottom prices plummet, and so do collectors left with few options. Or perhaps a creator turns out to be a scammer, leaving those who purchased their IP in limbo. Or worse, maybe one unsolicited NFT was dropped into a user’s wallet without permission.
Be that as it may, these unwanted NFTs can be a hindrance, an embarrassing reminder of the unsavory parts of the NFT space that enthusiasts often prefer to keep hidden. But sending them to unwanted wallets or using marketplace features to hide them from the public is just a Band-Aid. Surely there are better ways for collectors to get rid of unwanted NFTs.
Lucky for those there are. And we’re not talking about simply burning (destroying) it. No, instead, different platforms now offer holders unique rewards for dumping their NFTs.
Getting rid of NFTs for tax purposes
So you want to get rid of some NFTs. Do not worry; we won’t ask why, but just know that you are not alone. There are plenty of reasons why a collector would want to make an NFT disappear, with one of the most popular undoubtedly being tax loss collecting.
In traditional tax loss harvesting, an investor would sell an underperforming asset at a loss and then use that loss to reduce its taxable capital gains and offset the gains it had made on other investments. This can also be done with NFTs and is a significantly popular way to reduce taxes on digital collectibles.
Of course, there are all kinds of considerations to be made around NFTs and taxes. This includes charity, which you can read about in our full guide on the subject. But for those who simply want to offload and offset, there are a few services to choose from.
The NFT Loss Harvestoor
The NFT Loss Harvestooor is a free service created by the popular crypto tax software company CoinLedger. Essentially, the Harvestooor is a simple Ethereum smart contract that allows users to sell an NFT and receive a significant small amount of ETH (0.00000001) in return. By doing so, traders can realize capital losses on NFTs and reduce their taxable income.
What’s more, while the Harvestooor works well for collections that are still tradable, the service’s creators have teased a potential new service that would allow traders to get rid of even their “illiquid, worthless, back-pulled” NFTs. in the future.
Unmarketable NFTs
Unsaleable NFTs are another solid option for traders looking to reap NFT losses. The platform works much the same as the Loss Harvestooor, but comes with the added functionality of being able to claim losses on hundreds of NFTs at a time (up to 1,000). Users can expect to receive approximately 0.000007 ETH for each NFT, paying only transaction fees (up to 0.08 ETH).
Given that platforms like Blur have consumed a significant chunk of NFT market share in recent months – an example of the avid NFT trader’s affinity for zero-fee and high-volume trading – it makes sense that Unsellable would become a popular service has become for reaping tax losses due to their high batch sizes.
Other ways to get rid of an NFT
Perhaps you are not concerned about saving money, but rather about saving sight in getting rid of your horrible NFTs. Well, there are options that can be just as rewarding.
The junkyard
The Junkyard is a service somewhat parallel to tax loss harvesting that allows users to both dump their NFTs and win NFTs that have been dumped. By “dumping” an NFT in The Junkyard, a user earns not ETH but Junkcoin, a native currency of the platform. That currency can then be used to “fish” for NFTs dumped by others.
A wide variety of blue-chip NFTs have passed through The Junkyard to date, including pieces from Clone X, Doodles, Otherside, Cool Cats, and more.
Although the ecosystem could be are used for tax loss harvesting, The Junkyard is more of a gamified trading experience. The platform also hosts a variety of secondary and tertiary functionalities in development, such as free-mint NFT collections, membership-based experiences, token staking, and more.
Liquidity pool
Chances are there are other collectors holding a piece from the same collection as you and want to get rid of their unsatisfactory NFT as well. So why not try a liquidity pool? Services like NFT20 allow a user to deposit any NFT into an available pool or create a pool of their own (probably a necessity for bundling NFTs) and receive platform-native tokens in return.
Yes, this can be an unconventional way to get rid of an NFT given that liquidity pools are more commonly used to bolster trading and collector rewards. But it’s better than trying to hide a worthless NFT for eternity – even if it means losing out on profits in return.
Plaster solutions
If all else fails, even after considering or even trying the options listed above, you can always resort to the tried-and-true plaster solutions mentioned above.
First, you could use the “hide” feature offered by OpenSea and other NFT marketplaces. These features are usually built right into a marketplace’s interface and often only require a user to select which NFTs to hide, then submit and verify a transaction to hide them.
On the other hand, you could just choose to send an unsavory NFT to the universal Ethereum fire address. This is as easy as it looks. Just select a token in your wallet or marketplace profile, initiate a transfer, and send it to the 0x address associated with burning (0x00…dEaD).
HOW TO BURN A CRYPTOPUNK AND FEEL NOTHING…….THE TUTORIAL.
— ROBNESS V2 (@ROBNESSOFFICIAL) July 12, 2021
Of course, this particular burn option only works with Ethereum-based NFTs. Tezos and Solana based NFTs must be burned via other methods.
Take the shame out of throwing away
So you’re sticking with a garbage NFT. So? There are countless other collectors still out there owned by Blot or some other kind of unsavory derivatives. The fact is, you don’t have to HODL for “historical significance” or any other excuse.
It’s okay to let go. Better yet, why not use your unwanted NFT to reap a loss, try out a gamified experience, or even meet others who are in the same boat as you? After all, community is the most important part of the NFT space, right?
