Despite the less-than-ideal state of the NFT market, scammers continue to operate within the industry.
The US Federal Bureau of Investigation (FBI) recently warned about a new fraudulent trend: criminals impersonating NFT developers to execute financial scams. Scammers employ a dual approach, infiltrating legitimate developers’ social media profiles or creating nearly identical accounts.
These perpetrators then promote fake NFT releases with aggressive media campaigns using urgency-inducing phrases to garner intrigue — like “limited supply” and “exclusive mints.”
After a victim invests, scammers lead them to counterfeit websites through phishing links. The websites also prompt victims to connect their crypto wallets to make asset purchases. The FBI explained that this process typically results in transferring cryptocurrency and NFTs to the scammers’ wallets.
Discord channels dedicated to NFT collections remain among the most prevalent platforms for scams.
A Pudgy Penguins Discord incident revealed scammers using a new tactic to deceive NFT sellers in over-the-counter (OTC) deals. The scam entails a fake buyer sending a pending cryptocurrency transaction to pressure sellers into releasing their NFT prematurely. Despite the buyer’s convincing approach, the transaction eventually fails, exposing a vulnerability that scammers manipulate.
Pudgy Penguins’ Community Safety Lead, known on Twitter as TheChild, shared on X (formerly known as Twitter) that scammers initiate a cryptocurrency transaction, specifically in USDT, to the seller’s wallet. They then share transaction details to create a false impression of payment.
Afterward, the scammer employs psychological tactics, posing urgent queries such as “Did you get the money?” — insinuating doubts about the seller’s intentions to coerce them into releasing their NFT before the transaction’s finalization.
These scammers often suggest the Exodus wallet, falsely boosting portfolio value with pending transactions – a loophole needing Exodus’ attention. Trust manipulation underscores how scammers exploit emotions, driving costly errors.
“Also worth noting this scammer was operating in our token-gated discord channels. Just because someone owns an NFT from your favorite collection doesn’t mean they are a good actor!,” TheChild wrote on Twitter.
Security experts emphasize conducting OTC deals based on the seller’s terms and exercising caution if a counterparty demands specific tools. Sellers must retain NFTs until they securely receive payment. Although the allure of quick deals exists, established platforms offer greater safety.
The Pudgy Penguin incident underscores the necessity for caution and due diligence to avoid scams.
Millions Worth of NFTs Stolen Monthly in 2023
NFT thefts in July 2023 amounted to $1.73 million, marking a 31% decrease from June’s $2.27 million theft. The year’s highest NFT theft occurred in February at $16.2 million, followed by March with $10.9 million stolen. January and February saw 50% of stolen NFTs sold on OpenSea. In June, over 80% of stolen NFTs were sold on Blur.
July witnessed 19.63% of NFT thefts from OpenSea, 20% from X2Y2, and a majority, 67.3%, from Blur—the current leader in monthly NFT trading volume.
Stolen NFTs were rapidly sold across various platforms within 165 minutes post-theft, as reported by blockchain security firm PeckShield.
Source: mPost
