OAK — OnChain Attack Knowledge

Worked example · 2022-01

LooksRare wash-trading launch incentive — Ethereum — 2022-01-10 onward

Loss
unquantified in extraction terms; the LOOKS trading-reward mechanism produced incentivised wash trading that inflated the platform's reported volume above OpenSea's within days of launch. The harm is market-information-integrity erosion: wash-traded volume was reported as genuine trading activity.
OAK Techniques observed
OAK-T12.001 (NFT Wash Trading — primary; LOOKS rewards paid for volume that was self-dealing). OAK-T3.002 (Wash-Trade Volume Inflation — structurally co-occurring). OAK-T2.001 (Single-Sided Liquidity Plant — structurally adjacent; unverified in the cited sources and retained only as the original mapping).
Attribution
unattributed. LooksRare distributed LOOKS rewards based on a percentage of each day's total sales; the incentive was public and the wash trading was the rational economic response. LooksRare did not comment directly, but retweeted a seed investor's remark that the wash trading was happening "by design... probably" [decryptlooks1].
Corrected 2026-10-11
removed unsourced figures (95%+ wash share, named analyst reports, #2 ranking, CryptoSlam exclusion, airdrop threshold, Blur/X2Y2 2023 dates) and replaced them with Decrypt-sourced figures.
Key teaching point
A token-reward mechanism that distributes rewards proportional to nominal trading volume, without a wash-trading exclusion filter, structurally produces wash-trading volume. It is a mechanism-design property, not an attacker-behaviour property.

Summary

LooksRare launched in January 2022 as an OpenSea competitor with a LOOKS token. Traders earned LOOKS for trading NFTs, and LOOKS stakers received WETH from daily platform fees; about 185,000 eligible OpenSea wallets received an airdrop [decryptlooks1]. Over $12.1M of LOOKS was distributed daily at $4.23 per token at the time of reporting [decryptlooks1].

Decrypt (2022-01-12) observed back-and-forth trades using CryptoSlam sales data: a Meebits NFT sold for about $50M in WETH in each of two trades, and dozens of Loot and Meebits sales were about $3M in WETH each, against OpenSea averages of about 4.1 ETH for Meebits and under 2.2 ETH for Loot. Dune showed LooksRare at $377M volume that day after $325M the day before, above OpenSea's [decryptlooks1]. CryptoSlam said it was monitoring the activity [decryptlooks1].

By 2022-01-28 Decrypt reported more than $9.5B total Ethereum volume since launch (Dune) and more than $8.3B of wash trading identified by CryptoSlam, about 87% of volume [decryptlooks2]. The mechanism: users wash-traded between their own wallets at inflated prices to earn more LOOKS than the 2% marketplace fee plus gas [decryptlooks2].

Timeline

When Event OAK ref
2022-01 (launch) LooksRare launches; LOOKS airdrop and trading rewards go live [decryptlooks1] T12.001 surface created
2022-01-11/12 Reported volume ($325M, then $377M) exceeds OpenSea's; round-trip multi-million-dollar trades flagged [decryptlooks1] T3.002 execution
2022-01-28 CryptoSlam identifies over $8.3B of wash trading of over $9.5B volume [decryptlooks2] (analyst response)

What defenders observed

  • Volume-proportional token rewards without wash-trading exclusion predictably produce wash trading; the contracts functioned as designed.
  • Wash volume contaminates market-information surfaces: LooksRare's reported volume exceeded OpenSea's while organic activity was far smaller [decryptlooks1].
  • Detection came from third-party analytics (Dune, CryptoSlam), not from the marketplace [decryptlooks2].

Public references

Techniques demonstrated (3)