September 26, 2023

You might encounter several scams as NFT traders. The most common ones include pump-and-dumps, counterfeit NFTs, and phishing.

Non-fungible tokens (NFTs) saw a boom in 2022. Nevertheless, new and popular technologies such as the Web3 and decentralized finance (DeFi) carry risks. Hackers will always follow fortunes. Last year, attackers made $14 billion from crypto-associated hacks, while crypto crime saw a 79% increase.

However, how can you protect yourself from scammers as an NFT investor? Firstly, education is paramount. You can guarantee yourself security after understanding common scams related to NFTs. Pump-and-dumps are fraudulent activities where NFT hackers utilize deceptive info to jack up the floor prices of your favorite NFT.

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After they succeed, they sell their assets and leave investors empty-handed. Other tricks involve technical support scams. If you use Discord or Telegram, you might have witnessed cryptocurrency scams of this kind.

Phishing scams involve fake pop-ups that direct to ‘normal’ pages, like your wallet. They can also happen when you accept NFTs investment assistance. The attacker asks for your valuable and sensitive info and uses it to steal your assets.

The 3rd NFT scam isn’t new in the intellectual property space. Artists spend time on original artworks. Remember, it can take many hours to build an NFT collection, and the last thing you may want is someone copying. Hackers take artists’ original designs and turn them into NFTs. Buyers trust the projects and place impressive bids.

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Avoiding NFT Scams

Investors are gaining familiarity with risks related to NFTs security. Meanwhile, it’s essential to know how to evade scamming activities when holding an NFT or planning to purchase one.

To escape pump-and-dump scams, evaluate transaction records of any non-fungible token you prefer buying. Also, check the creator’s contact details. Avoid deals with all transactions performed at a specific date.

While evading phishing attacks, avoid sharing your information with online individuals. Never disclose your wallet keys, and don’t react to contact requests and suspicious offers. Moreover, always use 2FA for security.

Stole artwork can be challenging to notice. Nevertheless, research the creator’s account, messages on social media, and the community. Some NFT markets are introducing new tools to scan blockchains for fake NFTs. Finally, non-fungible scammers do not have blue checkmarks on their usernames.

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