Common NFT Scams & Safety Tips

1. Fake Marketplaces

• Find a platform where you can purchase and sell NFTs if you’re considering making your first investment in one

• These fraudulent websites don’t offer genuine NFTs, therefore if you purchase one, the website will record your login information from the specifics of your transaction

• Additionally, these websites may request your private keys or 12-word security seed phrases and utilize them to empty your virtual wallet of all its contents

• Never submit your information in links, pop-ups, or emails in order to avoid these frauds; instead, always pick trustworthy NFT trading platforms, such as Binance NFT marketplace, for cryptocurrency transactions

2. Fake Offers

• NFT scammers frequently send you fake emails saying that you have received an offer for your NFT by impersonating trustworthy NFT trading sites

• The goal of these phishing emails is to trick you into clicking on an embedded link that will lead you to a fake NFT marketplace

• Like many previous phishing scams, clicking the button will take you to a fake page that requests your digital wallet’s link and seed phrase, enabling criminals to access your wallet

• Always check and double-check the sender address of any email you receive from an NFT trading platform in order to prevent falling victim to these kinds of scams

3. Fake Giveaways

• Scammers will contact you via social media and invite you to participate in their NFT giveaway campaign while posing as employees from well-known NFT trading platforms

• If you spread the word about the offer and register for an account on their website — a phishing site — they might guarantee you a free NFT

• They will also record what you type, obtain access to your account, and maybe steal your collection of NFTs once they have persuaded you to attach your digital wallet credentials in order to claim your prize

• Check out that person’s social media accounts and confirm that the link you’ve obtained from them matches the company’s official domain name to avoid falling for this kind of NFT scam

4. Rug Pull Scams

• Rug pull scams occur when an individual or organization releases a preliminary collection of NFTs to launch a larger project that will eventually include a game component, merchandise, or an event

• The trick is when they steal the millions of dollars collected before any of the promised activities can be carried out

• This occurs frequently and swiftly, but there have also been examples of slow rug pulls, in which the project is gradually abandoned without any fresh advancements or updates

• DYORing is the best defense against falling for a rug-pull scam

• Look into the project’s personnel and assess their long-term business strategies

• Follow the project on Twitter, Discord, or other public forums since an NFT project needs a huge active community of involved investors to have strong liquidity or lasting aesthetic value

5. Counterfeit NFTs

• The act of creating a digital file as an NFT does not grant you ownership of it or create a new work of intellectual property

• Instead, it merely converts a digital file into a blockchain storage object

• A digital creator’s work can be easily stolen by con artists, who then make an account on an NFT marketplace and post the fake work for auction

• When the community finds that the NFT you bought is fake, it will become worthless and there will be no way for you to get your money back

• How can this con be avoided? Check the seller’s social media or Discord profile for a verification checkmark before placing a bid on the NFT for further credibility

6. Pump and Dump Schemes

• In this instance, the phrase describes the act of someone or some group aggressively buying up a large quantity of NFTs to artificially increased demand

• They do this quickly to give the impression that the NFT is well-liked, and once it attracts attention, they will cash out when the selling price reaches the level at which they feel comfortable

• leaving left worthless assets for the highest bidders

• Having said that, always check the NFT you wish to purchase transaction history

• A pump and dump strategy may be revealed by numerous transactions occurring on the same day

7. Bidding scams

• When investors wish to resell their purchased NFTs on a secondary market, bidder scams take place

• After you have advertised your NFT sales, bidders may substitute your preferred currency with a lower-value cryptocurrency without informing you

• If the seller doesn’t confirm the currency before finalizing the sale, this could result in possible losses for them

8. Customer support scams

• Hackers contact unwary targets on Telegram or Discord by posing as technical or customer support workers for blockchain marketplaces, which is similar to phishing scams

• Scammers provide links to fake official-looking websites while pretending to help with problems in order to obtain personal data and access to bitcoin wallets

• Alternately, they can ask you to share your screen to fix the problem when what they really want is to see and screenshot the password to your cryptocurrency wallet

• How do you prevent them? Verify the site domain and only request assistance through the official NFT marketplace

• Scammers may pretend to be sending you security alerts regarding your account or NFT collection, but their methods are often the same

• Before clicking on anything, be sure it is legitimate

REFERENCE

1. https://www.binance.com/en/blog/nft/common-nft-scams--safety-tips-2022-421499824684903591

2. https://www.kaspersky.com/resource-center/preemptive-safety/how-to-avoid-nft-scams

DISCLOSURE:

None of these articles constitutes financial advice. Articles are highly summarised to make it easy for the reader and save your time, so please DYOR further before putting your hard-earned money into any product mentioned.

Please note that the tech industry evolves rapidly and the info in this article is correct at the time of publishing. As Heraclitus said, “Change is the only constant,” so if anything sounds old or off, please holler on the socials or comment here so everyone stays peeled.

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