NFT Fraud in 2024 | Most Common NFT Scams

NFTs are also used to create and trade virtual property, digital collectibles, in-game items, and more. This makes NFTs an important tool in the virtual economy, providing the ability to monetize digital assets. However, despite this innovative technology, the popularity of NFTs has attracted many attackers who try to take advantage of users’ lack of awareness about safe practices for working with tokens.

The main purpose of NFT is to verify the authenticity and uniqueness of digital content. This has opened up great opportunities for creative individuals, collectors, and investors. NFTs have become popular among artists, musicians, and even brands that release limited edition digital goods. However, with the sharp increase in interest in NFTs, the number of scams associated with them has also increased some time ago.

NFTs are created using blockchain technology, most commonly on the Ethereum platform, where each token is recorded on the blockchain and can be tracked. This allows token owners to prove their ownership and the authenticity of the asset. Blockchain ensures that all transactions are transparent and cannot be changed retroactively, increasing trust in the system. Blockchain technology makes NFTs virtually immutable and counterfeit-proof.

In addition to Ethereum, NFTs can be created on other blockchains, such as Binance Smart Chain, Solana, etc. These blockchains offer their own features and capabilities for issuing and managing NFTs. For example, some blockchains may offer lower transaction fees or higher data processing speeds, which makes them attractive to users. However, it is important to remember that each platform has its own characteristics, and users should be aware of the possible risks.

Each NFT contains information about the owner, creation date, original author, and previous owners. This data is stored in a decentralized database, making NFTs a secure way to prove ownership of a digital asset. However, despite the use of blockchain technology, the NFT market is susceptible to many fraudulent schemes.

NFTs work not only as digital assets, but also as proof of ownership of a unique object. For example, if you buy an NFT of a piece of art, your token proves that you own the original digital image, even though copies of it may be available online. This opens the door to a new level of digital ownership, but also raises questions about security and protection of rights.

The popularity of NFT at the time attracted the attention of not only investors, but also scammers. They use various schemes to deceive users and steal their funds. Some of them look quite legitimate at first glance, but in reality, they can lead to the loss of significant amounts. For example, scammers can counterfeit NFTs, hack crypto wallets, or create fake platforms for selling assets. It is important to understand that despite the advantages of blockchain, users can become victims of social engineering or phishing attacks.

With the increase in the number of NFT projects and platforms, users have encountered situations where they cannot distinguish between a legitimate platform and a scam one. This is due to the fact that many scam projects imitate the interfaces of well-known platforms, attract users with favorable conditions, and then disappear, leaving them without funds.

One of the most common schemes is the creation of fake platforms for NFT trading. Fraudsters create fake nft websites that look like real ones, offer tempting conditions for buying or selling NFTs, but in fact steal users' data and their funds.

This scheme is often used by scammers who create fake websites that completely copy the design of well-known NFT trading platforms. The user registers on such a platform, enters their payment details, and after a while notices that money has been debited from the card for NFT. This happens because the fake website collects user data to use it to steal funds.

To avoid this type of scheme, it is important to always check the domain name of the site you plan to buy or sell NFTs on and use two-factor authentication to secure your account.

Another popular scheme is selling counterfeit NFTs, also known as NFT phishing scam. Fraudsters create copies of famous digital works and sell them, passing them off as the original. Buyers who have not verified the information about the work become victims, purchasing worthless tokens. Even on popular marketplaces there are many scam collections and it is difficult to say how many NFTs are fake.

To protect yourself from this type of fraud, it is recommended to always check the NFT author and the token ownership history. Many platforms provide information about when and by whom a particular token was created. If the author's information is missing or suspicious, it is better to refuse the purchase.

It is also worth paying attention to excessively low prices for popular works. If the price of an NFT is significantly lower than the market price, this may be a sign of fraud.

Scammers may offer "help" in withdrawing funds from NFT sales or withdrawing money from wallets, promising to make the process faster or more profitable. This can be especially dangerous, as it is possible to be tricked into withdrawing money from NFTs - one of the biggest NFT scams. In reality, this turns out to be a trick to steal your funds.

This scheme is often found on social networks and messengers, where fraudsters offer their "services" for exchanging or withdrawing funds. As soon as the user provides their data, the fraudsters write off the money and disappear. It is important to never share personal information with strangers and not to use dubious exchangers or intermediaries to withdraw funds.

Fraudsters can use social engineering to trick users by directing them to phishing sites where they ask for personal data or keys to crypto wallets. For example, you may be asked to confirm a transaction, click a link, where the data will then be stolen.

Social engineering is one of the most insidious forms of fraud, as it exploits human emotions and trust. Fraudsters may pose as technical support or platform employees, asking you for access to your wallet or account. To avoid this, always check official communication channels and never share your data with third parties.

Another popular method is hacking crypto wallets where NFTs are stored. Fraudsters use phishing attacks or malware to steal private keys, giving them full access to the user's assets.

Using hardware wallets can significantly increase the security of your assets. These devices store private keys offline, making them less vulnerable to cyber attacks. Even if scammers gain access to your computer or mobile device, they will not be able to access your hardware wallet without physical access to the device.

Some NFT scams use a "pump-and-dump" method. Scammers artificially inflate the value of certain NFTs by promising huge profits, then dump the assets, leaving participants with worthless tokens.

This scheme is especially dangerous for beginners, who may be attracted by promises of quick and easy money. To avoid participating in such schemes, it is important to carefully study the project, check the reputation of its founders and not trust promises of huge profits in a short time.

The scheme involves creating fake auctions that purport to sell rare and valuable NFTs. Once a buyer places a bid and transfers funds, the site shuts down and the seller disappears with the money.

Fake auctions may be part of a larger scheme involving hacking accounts on legitimate platforms where scammers pose as legitimate sellers. It is important to always use official platforms to participate in auctions and not bid on dubious sites.

Scammers often simply copy the work of famous artists or musicians and sell them as original NFTs. This is a scam, and such tokens have no value.

To avoid NFT scams, you should always follow a few simple rules:

It is also important to carefully study the documentation and terms of the transaction. If the terms of the NFT sale seem unclear or raise suspicions, it is better to refuse the purchase and seek advice from specialists.

If you encounter a scam while dealing with NFTs, it is important to act quickly. First, record all information about the transaction and contact the support of the platform where the scam occurred.

AML Crypto offers professional services in investigating cryptocurrency crimes, including NFT fraud. We use advanced blockchain transaction analysis technologies and our own tools to identify the culprits and help recover stolen funds.

If you need help, contact us on Telegram or email us at info@amlcrypto.io. We will promptly conduct an investigation and provide you with a report with recommendations for further action. Do not miss the opportunity to get your funds back and punish the scammers.

We recommend staying calm and following professional advice from experts in case of fraud. AML Crypto has many years of experience in investigating crypto crimes and can provide qualified assistance in finding and returning stolen assets.