When a community embraces an innovation, we all recognize that it will be targeted by fraudsters, scammers, phishers, or other sorts of cyber attacks sooner or later.
That is exactly what is going on in the NFT industry. Cybercriminals are creating simple and increasingly complex methods to deceive victims and steal their valuables, with phishing being one of the most common.
Phishing is A Big Problem
NFT (non-fungible token) is a blockchain-based digital asset similar to Bitcoin or Ethereum. This is a sort of data that is maintained on the blockchain and contains asset verification information, with each token characterizing a unique unit of asset.
Dropped in April, Moonbirds, an NFT collection of 10,000 utility-enabled PFPs, took the community by storm as the price of digital items kept surging during the launch week.
One of the Proof Collective members has reportedly today fallen prey to a phishing scam, resulting in a loss of 29 Moonbirds, equivalently over $1.5 million at the time of the report.
The incident was shared by an NFT collector through a screenshot of the transaction.
Shortly after the tweet, Dollar, another Twitter account and NFT holder tagged a Twitter account “@DVincent_” to have been believed to be the personality behind the attack.
We can’t confirm the guilt of anyone. We are also not implying the validity of these statements.
Dollar also claimed that a full report to the FBI has been drafted by Moonbirds’ creator and Proof Collective members and ready to go if the ponited culprit does not return the stolen asset.
That culprit was also accused by another NFT holder of trying to convince the other collector to utilize the fraudulent platform for a private transaction.
— crypt0savage (@crypt0savage) May 25, 2022
An Unregulated Market
Phishing scams, often known as cyber hacking, are on the rise. The strategy is straightforward, not novel, yet consistently effective. One of the most common scams is phishing via Twitter.
Many of NFT’s artists and projects gain huge Twitter followings from fans and enthusiasts who are interested in their work, similar to other platforms. This also allows for the creation of impersonated accounts, which can be used to exploit users.
Scammers can even use false or compromised official accounts to publicly share phishing links in order to spread the attack and prey on more people. As for the case of Moonbirds, it appeared that the victim fell into a bad situation.
A scammer performs the phishing scam by texting users who follow the hyped artist, the project they are impersonating, or users interested in NFT in general.
They will notify the user that they have won a special reduced transaction fee, ore deals and will then provide a malicious link to a website.
By clicking the link, users provide scammers with the information they need to access the accounts or wallets they own.
At that point, it may be too late for the victim. This is another reminder to always double check everything you do in the NFT space; you always have time.
The Danger of Social Media
Twitter has been recently linked to many NFT hacks.
In the previous week, Beeple, one of the prominent figures in the NFT space, announced that hackers compromised his Twitter account and shared a fraudulent link to steal funds from users’ wallets.
It caused a damage of $438,000 worth of crypto. Scammers may quickly capture the recent collaboration of the NFT creator with Louis Vuitton and take action.
In early May, Beeple and the high-fashion brand formed a partnership to create 30 reward NFTs for the mobile game Louis The Game.
With NFTs reaching unbelievable values, it’s no surprise that hackers are doing everything they can to take advantage of this thriving market.
So, if you possess any type of NFT, keep in mind that no one is safe in this rapidly expanding market. Never give out any sensitive information because it can be exploited to steal your precious possessions.