OpenSea, one of the largest NFT marketplaces, has paused its XP reward system for listing and bidding after receiving criticism from the community.
The system, introduced as part of OpenSea’s new OS2 marketplace beta, was designed to help users qualify for an upcoming airdrop of the SEA token. However, many users argued that the XP mechanics promoted wash trading and favored high-frequency traders rather than benefiting NFT creators and genuine collectors.
Issues with XP Farming and Wash Trading
Since launching on January 28, OpenSea’s new XP system allowed users to earn points based on their activity, contributing to their eligibility for SEA tokens. However, community members quickly pointed out issues with how the system was being used.
NFT traders, including collector and influencer Wale, described the trading activity of top XP farmers as exploitative. High-volume traders engaged in a cycle where they placed bids and immediately dumped assets on the next bidder, maximizing XP rewards without taking financial risks. Unlike competitor Blur, which implemented a cooldown period between sales, OpenSea had no such restrictions, enabling constant trading loops that artificially inflated XP scores.
Furthermore, OpenSea’s zero-royalty policy meant that creators did not benefit from the increased activity, unlike Blur, which enforces a minimum royalty fee. Some users noted that top traders were spending tens of thousands of dollars in fees while farming XP, highlighting how the system prioritized fee generation over genuine NFT engagement.
OpenSea Adjusts Reward Structure
In response to the criticism, OpenSea co-founder and CEO Devin Finzer announced that XP rewards for listing and bidding would be paused. Instead, OpenSea will focus on XP shipments, a new mechanic introduced on February 14, though details remain limited.
Additionally, the platform has shifted rewards toward buying and holding NFTs, encouraging users to engage with NFTs more meaningfully rather than focusing on rapid, repetitive transactions.
Mixed Reactions from the Community
While some users were disappointed that builders, artists, and creators were not prioritized in the original XP system, others appreciated OpenSea’s quick response to feedback.
NFT holder Langerius acknowledged the update as a positive step but expressed surprise that OpenSea had initially designed the system in a way that encouraged wash trading and unfair competition.
As OpenSea continues to refine its airdrop mechanics, the NFT community will be watching closely to see how the revised XP system balances fairness, engagement, and rewards for all participants.