8 Common NFT Scams & How to avoid

In the NFT Community, NFT Scams, rug pull, and catfishing are all becoming increasingly common. Both new and seasoned collectors have suffered large and minor losses.

In this article, we will look at some of the most prevalent NFT scams, how to avoid them, and some valuable safety advice. The frauds listed below are all based on NFT community members’ own experiences. There are always new ones appearing, so keep careful and attentive at all times.

Random Discord DMs

The larger your Discord network grows, the more fake invites you will receive. Discord DMs can be especially troublesome, especially if the impersonator is a brand, artist, or NFT influencer. Never click on links, no matter how legitimate they appear, or on DMs from “friends” requesting money, or on “announcements” from NFT initiatives (always check the group and ask in the group first). If you receive an unusual message from someone you know, double-check their handle first.

Fake Twitter Account

Most NFT influencers and brands will have someone imitate them at some point. Be extremely cautious, as the bogus profile will exactly mirror the actual one. If you aren’t paying attention, you won’t notice that the only difference in the bio is that it says DLCBlogger instead of DCLBlogger (To be honest, it took me a while to notice the difference in between, be careful guys!)

These bogus accounts will message you pretending to be interested in a discussion or asking for assistance and advice on something. This NFT scam is largely for newcomers to the area to be aware of; once you’re familiar with the NFT community, you’ll be able to spot the bogus Twitter profiles and conduct rather fast.

If you take a second to look, you can usually (but not always) recognize these bogus profiles. For example, they will have far fewer followers than they are following, copied and pasted tweets from legitimate handles, far too many retweets of other accounts with no original content, and other anomalies.

Fake Marketplaces

Fake markets with pretty much similar URLs. This is one of the classic NFT scams that have been and will continue to exist in perpetuity. It can happen via Discord, emails, Twitter, or any other method of NFT or crypto communication.

Suspicious-looking emails from large corporations such as OpenSea are not uncommon. These emails will seem eerily similar to the genuine thing, with a few tiny differences in the links. Before clicking on anything requesting personal information, such as a seed phrase or password, carefully examine the links and messages.

Just remember the Golden Rule: never ever enter your seed phrase outside of your initial wallet! And pay attention to the domain.

Pump & Dump

The pump and dump scheme is another crypto and NFTs classic scam. This is when an individual or, more commonly, a group of people buy a significant number of NFTs in order to falsely manipulate the market by increasing demand. Once the value has increased, the scammers sell all of their assets and profit handsomely, leaving everyone else with worthless NFTs and significant losses.

Checking the transaction history is one of the greatest methods to recognize a pump and dump; a legitimate project should have a varied range of buyers, not just a few customers who are selling and re-selling. If you feel you’re involved in a pump-and-dump scheme, try to get out as quickly as possible.

Artist Impersonators

There have already been a few cases where someone stole artwork from the original creator and claimed it as their own. It is not yet prevalent, and of course, the true artist will find out at some point; but, by then, you will have lost your money.

It is recommended to buy from certified artists or artists that have been active in the community. The most typical artist impersonation NFT scam is someone attempting to sell popular NFTs quickly and cheaply before their profile is removed.

Bidding Scams

Fake bids are a terrible fraud that some people have fallen victim to in recent months. So you put your NFT up for sale, and people bid on it, but here’s the catch: they bid in USDC. You end up selling the gorgeous Bored Ape for 17 USDC instead of 17 ETH (true story). Ouch. That stings! To ensure they get you good, some scammers will even change their profile picture to a WETH logo.

A more recent NFT scam is someone listing, then immediately delisting and relisting with the decimal moved to the right.

Paid Google advertising is frequently used to impersonate brand names on websites.

Airdrops & Giveaways

Everyone in the crypto and NFT world appears to want to offer you free money and make you rich. But, it is too good to be true. Messages claiming to be “free” airdrops may frequently appear on Discord from a fake user.

In rare circumstances, a verified account has been hijacked and rebranded to appear to be genuine. Typically, these questionable attempts will feature unusual grammatical and spelling errors.

Some airdrops are also advertised by impersonating the brand on Twitter. The bogus account will appear to be quite legitimate, with a large number of followers and postings. Once again, they will post a link requiring you to provide a password or seed phrase. It’s not a good idea. It’s a Ponzi scheme.

Be cautious about sharing your wallet’s address anywhere and everywhere. These types of posts are frequently seen in Facebook groups and on Twitter, but the more private you are, the safer you will be. If someone drops something in your wallet at random, it will very certainly be spam or contain something dangerous.

Are there any other types of scams that you have known but haven’t listed here? Let us know by commenting down below!

If you have any questions, comments, suggestions, or ideas about the project, please email ventures@coincu.com.

DISCLAIMER: The Information on this website is provided as general market commentary, and does not constitute investment advice. We encourage you to do your own research before investing.

KAZ

Coincu Ventures