How To Identity Unique NFTs And Dodge The Scams

How To Identity Unique NFTs And Dodge The Scams


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Scams and frauds in the cryptocurrency space have been well-documented. The crypto market; however, is a hotbed of dubious behaviour due to a lack of reliable information and no controls. According to a recent Chainalysis estimate, Indians visited the crypto fraud sites over nine million times in 2021. Crypto scammers have widened their nets, and investors in non-fungible tokens are the next to fall victim (NFTs).

Artists and collectors gain from NFTs in a variety of ways, but only if the system works as planned. Scammers, on the other hand, often benefit as much as or more than artists, thanks to new technology. It’s exciting to own a digital piece of art or music, but it’s not so exciting to lose hard-earned cash. So, here’s a quick guide on how to recognise and avoid these scams.

What Are NFT Scams?

Before we discuss NFT frauds, we must first understand the NFT meaning.

An Non Fungible Token is a unit of data kept on a digital ledger known as a blockchain, which guarantees that a digital asset is unique and, hence, not interchangeable. It can be used to represent a variety of things, such as images, movies, audio, and other digital files. 

NFTs work similarly to cryptocurrencies. They demonstrate ownership in some way. They cannot; however, be traded like bitcoin tokens. As a result, they’re referred to as “non-fungible.” Furthermore, unlike Bitcoins and other cryptocurrencies, NFTs have no monetary value. An NFT for a painting by a well-known artist, for example, is more expensive than one for a book.

NFT scams happen when scamsters often disguise themselves as officials from an NFT marketplace and try to offer a lucrative fake giveaway or airdrop in the name of promoting a project.

How Does One Get Scammed?

Many NFT buyers are sure that their tokens are safe because of the blockchain’s nature as a distributed, decentralised record that can’t be tampered with. However, some old-school hacking techniques are very efficient in scamming.

On both sides of a transaction, impersonation has resulted in the loss of both- NFTs and crypto. Although these assets are stored on the blockchain, third-party marketplaces such as OpenSea exist to help with transactions. They ensure that each sale is backed up by institutional security. However, hoaxers may easily set up replica marketplaces with similar URLs, and because the visible component of an NFT is only an easily duplicated image with some plaintext information, these websites can look very identical to authentic ones.

Scammers frequently use social media to do their business. Imitation accounts for NFT inventors and investors abound, and they frequently target users wishing to buy or sell in their DMs with false promises of gifts. They get access to your crypto wallet in exchange for access to your money and valuables.

The riskiest aspect of investing in crypto and NFTs is that the industry is still relatively unregulated, leaving room for bad actors to exploit loopholes.

7 NFT Scams You Need To Know About

  1. Replica Stores

In the area of online fraud, the problem of replica stores is well-known. Scammers create websites that appear just like the real thing to fool people into giving away their credit card information or checking in with their passwords. We see online retailers in a variety of industries being targeted at Bolster, and stores selling NFTs are no exception.

  1. Artist Impersonation

This is when someone steals a digital artist’s work and passes it off as their own. They attempt to sell popular NFTs for a low price and are successful in selling some before their profiles.

Pro Tip: A word of caution: If something seems too good to be true, it’s probably best to avoid it. Second, always double-check that the artist you’re buying from is legitimate (or the product from the holder is verified).

  1. Brand Impersonation

This has been a typical scam in the cryptocurrency space since the beginning, and it has now spread to the NFT space as well. Brand impersonation is an assault that impersonates a trusted firm or brand to deceive victims into responding and providing personal or otherwise sensitive information.

Pro Tip: Never give out your private keys to anyone, never enter them online, and be mindful of where you’re looking for NFTs. Practise proper internet safety and security to avoid these problems in the future.

  1. Fake Storefronts

This will appear using a URL that is similar to or contains terms from the actual store’s URL. They may try to fool you into buying a counterfeit NFT or giving them your private key by making the site look similar to the one you are familiar with. Pay attention to the URL and how you arrived at the site, and report any errors you see.

  1. Fake Technical Assistance

Scammers will also approach you over Discord, posing as a bogus support team. For example, if you contact them for technical help, they will claim to be from OpenSea or another well-known website. The fraudster can then advise you to share your screen, causing you to reveal your wallet’s passcode by taking a screenshot of it. It could even email you a link to a phoney customer support page where you’ll be asked to submit your information. Always be on the lookout!

  1. Fake Gifts

People are often falling for frauds and receiving bogus giveaways. Scammers pose as representatives from well-known NFT trading platforms and find you on Discord or Telegram. They falsely claim to have an offer and give you free NFTs in exchange for your assistance in spreading their messages and participating in promotions on scam or phishing websites! Its goal is to steal your wallet information. If an offer appears to be too good to be true, it most often is!

  1. Fake Emails

Fake email notifications regarding offers relevant to your NFT are also sent by scammers posing as well-known NFT trading websites, inviting you to click on the attached button to examine the information. Of course, you should always keep an eye on the sender and the website to which the email is attempting to take you. Why would you click on something if you’ve never heard of the sender or website?

They also send out fake security alerts through email, claiming that you’ve been hacked or that someone has attempted to enter into your account. In this instance, it’s advisable to go straight to the website, rather than clicking on any links in the email, and try to call technical support to see if there’s anything wrong with your account. In any case, you should think about changing your password.

Phishing emails contain buttons and links that direct you to a phishing website. You’ll be asked to link your wallet and enter a recovery phrase on the bogus page. Similar to how social networking or bank phishing sites function. Scammers can steal all of your money by recording your credentials and hacking into your wallet.

How To Avoid NFT Scams?

There are a few things you may do to protect yourself from NFT scams. Let’s begin with the most critical:

  • To safeguard your accounts, use strong passwords and use ID Security to easily keep track of your personal information.
  • NEVER disclose your seed phrase or password unless you are 100% certain and have double-checked all you’ve done.
  • Incoming DMs from “friends” should always be checked for message history.
  • Don’t click on any links that claim to offer freebies, airdrops, or anything else. If you’re tempted to click, make sure you know who’s giving you the links first. Particularly on Discord.
  • Invest in a “cold wallet” to protect your most valuable valuables. A wallet that you don’t use regularly and that requires various security procedures to access.
  • Use a hardware wallet like a Ledger or a Trezor to store your coins. A hardware wallet is a bitcoin wallet with strong security that allows you to save your funds offline. Simply connect it to your computer when you need to manage your funds. Here’s where you can learn more about hardware wallets.
  • For all of your wallets and accounts, use a password manager like LastPass (or any other). A password manager helps you create and remember complicated passwords by storing them in an encrypted database.

Now, you might have a question regarding how to identify the real NFT’s as companies to Ponzi NFT’s? Well, we have got you covered!

How To Identify The Genuine NFT’s?

  • Check the NFT Metadata and Transaction History for further information.
  • Use a service that verifies NFTs.
  • Digital Certificates Can Be Used To Verify NFT Ownership
  • Examine the owner’s social media profiles as well as NFT platforms.
  • Check to see if the NFT may be sold using its ID.
  • Keep track of all the NFT numbers you own.
  • Monitor the selling price (For instance, when you’re getting something at a drastically low price, lower than the perceived value then it is not a good bargain but some plagiarised work.)

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