Top 7 NFT Scams to Look Out For
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Scammers create malicious NFT project websites that promise free NFT giveaways. While some NFT giveaways are genuine, a large number of them are scams.
NFT airdrop scams
You can avoid this scam by remembering that you only need your seed phrase to backup or recover your wallet. Never share your recovery phase or private key with anyone.
However, MetaMask wallets have been (and still are) targeted by phishing scams involving fake ads, apps, and websites that ask wallet users for their private keys or recovery phrases. Malicious actors then use the information to drain your crypto wallet of all its assets.
To purchase an Ethereum (ETH)-based NFT, you will need a crypto wallet that supports the ERC-721 standard. MetaMask is arguably the most popular wallet for NFT creators and collectors.
Phishing scams
You can avoid this scam by reviewing the transaction history and wallet records of the NFT collection you are interested in. You can view the number of transactions and buyers for the NFT collection on NFT marketplaces like OpenSea. Moreover, Etherscan enables you to view transaction history on the Ethereum blockchain.
NFT scammers use pump and dump schemes to artificially drive up the price of their NFT collection to make bank. They execute this by making several bids within a short period to build hype around the NFT drop. Once prices have risen to a certain level, the scammers cash out and leave clueless buyers with NFTs that they grossly overpaid for.
Pump and dump schemes
Bidding scams typically occur in the secondary market when you try to resell your NFT to the highest bidder. Once you list your NFT and an interested buyer places the highest bid, scammers may switch the cryptocurrency used without telling you. This way, you end up receiving USD 10 instead of the ETH 10 you agreed upon. You can avoid this scam by checking the transactional currency before you begin the transactions.
Bidding scams
Top 7 NFT Scams to Look Out For
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