CNN Ends NFT Vault effectively rugging collectors

*Correction: in the original publication NFTCulture staff said the project only lasted 6 weeks and had an inaccurate graphic describing the project as a rug.

After CNN abruptly closed its web portal for collecting digital assets, some crypto enthusiasts were left without access to their digital collections.

Many others were outraged when they learned that CNN had abandoned its very first blockchain token sale.

On Monday, members were informed that the experiment has been canceled and that they will receive compensation pro rata based on their purchases at the time of the cancellation. Roughly twenty percent of the original value of each Vault NFT purchased during the six week period will be paid out.

As developers explained, the NFTs would continue to belong to their owners, and the site would remain open for people to buy and sell items. Unsold NFTs would then be burnt, which makes the remaining ones “rarer.”

Despite reassurances, some members of the community were disappointed. They feared that they would not receive their refunds and blamed CNN for a “rug pull,” a term used when an investor or collector is blindsided by a project being abruptly abandoned by its developers, leaving them with no refund at all.

“Is an announcement of rug” meant to console a community who has been waiting patiently for slow-but promising utility?” A user in the Discord referred to the upcoming features as “coming soon.”

A third person described the choice as made “in a ruthless manner without consideration for collectors and plans.”

“A poor decision for a company of this scale,” wrote another user. “No person would welcome CNN into Web 3 if NFTs ever blew up again.”

Some people were confused by the fact that CNN used the term “experiment” instead of “trial.” However, they didn’t answer any questions about it.

The announcement did not come with any explanation, but several indications suggest that CNN was planning to keep up its NFT program. A document on the site’s marketplaces features a 2022 roadmap that describes upcoming benefits for members, among them an exclusive gallery for collectors, special events for collectors, and the ability for collectors to create their own CNN-related NFTs.

While CNN earned over $300,000 in revenue from selling NFTs, the value of these tokens has fallen dramatically since their peak in January 2019. According to Bloomberg, citing research by Dune Analytics, the number of trades per month for NFTs fell 97 percent between January and September 2019.