Gate.io مدونة Watch Out for NFT Scams - How to Distinguish True and False NFT?

Watch Out for NFT Scams - How to Distinguish True and False NFT?

19 January 16:21

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**<font size=5>[TL; DR]</font>**
🔹 The total sales of NFT in 2022 reached $55.5 billion, up 175% from $20.2 billion in 2021.

🔹 Watch out for fraudsters who copy NFT artworks and then start selling them after minting, falsely claiming to be officially sold.

🔹 There are 7 ways to tell the truth about NFTs to keep you away from the NFT scam.

## Introduction
According to incomplete statistics, there were 44 safety incidents in NFT in the whole year of 2022, with losses exceeding $42.56 million. In 2022, the total sales of NFT reached $55.5 billion, of which 46% came from wash trading.

NFT has always been a popular trend in crypto-asset transactions. How can we identify false NFTs in the current era of fraud?
## Are NFT Scams Common?
2022 has been a turbulent year for cryptocurrencies. The cryptocurrency bullish market ended after several major events. Such market impact also impacts NFT. In 2022, NFT's sales and total users were on the decline. However, the total sales of NFT in 2022 reached $55.5 billion, up 175% from $20.2 billion in 2021.
![](https://gimg2.gateimg.com/image/article/1674115864111.png)<center><font size=1>The data source of NFT sales and total users in 2022: Footprint Analytics</font></center>

Thus, even in the bear market environment, investors still have a strong interest in the NFT market. There were about 145,000 NFT collections in 2021, but by the end of 2022, the relevant data had been significantly increased. Every day, new collections and projects are born in NFT, which creates many investment opportunities. However, opportunities and market demand go hand in hand, and so does fraud.

[NFT scams are pervasive](https://www.gate.io/blog_detail/544/NFTs--a-new-window-of-opportunity-for-digital-scammers--learn-How-to-Avoid-NFT-Scams "NFT scams are pervasive"), ranging from hundreds of thousands of dollars to millions of dollars. For example, the recent copy of Mutant Ape Yacht Club (MAYC) and the NFT developer Aurelien Michel of Mutant Ape Planet series were arrested and charged with fraud for allegedly defrauding $2.9 million.

In February 2022, OpenSea in the NFT market was subject [to phishing fraud against users](https://www.gate.io/ru/blog_detail/770/the-implications-of-opensea-phishing-scam?lang=en "to phishing fraud against users"), and NFTs worth more than $2.7 million were illegally leaked. Its fraudsters sent fake emails disguised as OpenSea to trick users into tracking malicious links and urging them to sign fraudulent contracts.

Currently, NFT "Bored Ape Yacht Club (BAYC)", which is relatively trending and has a high transaction price, also has the possibility of fishing fraud. The CEO of its project developer, Yuga Labs, stated that they had received a message that someone was [trying to attack](https://www.gate.io/blog_detail/1032/The-Official-Bored-Ape-Yacht-Club-Instagram-account-hacked-with-over--13.7-Million-worth-of-BAYC-NFTs-stolen "trying to attack") their project.

There [are countless NFT scams](https://www.gate.io/blog_detail/1342/What-are-the-most-common-types-of-NFT-scams "are countless NFT scams") of similar sizes, and the amount is unlimited. Even the NFT collection of celebrities has been revealed to have been stolen. For example, Jay Chou, a famous singer, said in an article on April 1 that his number 3738, the Bored Ape NFT, was stolen by phishing, with a value of $330,000.
![](https://gimg2.gateimg.com/image/article/1674115934222.png)<center><font size=1>Bored Ape Yacht Club NFTs. Source: opensea</font></center>
## What is the difference between non-fungible tokens and non-fungible images?
NFT stands for non-fungible token. Its essence lies in the unique trusted digital equity certificate in the blockchain network, which is a unique digital asset and an important infrastructure for the current popular metaverse.

Its characteristics include uniqueness and indivisibility. Each NFT work has a unique "digital ID card", which is the number set by the creator. This also enables NFT works to be completely recorded by the blockchain in every <a href="/price/link-ln" target="_blank" class="blog_inner_link">LINK</a> of circulation and trading.

However, there are many kinds of NFT, including images, paintings, and other artworks, games, player cards, films, music, avatars, insurance, and gifs. Non-Fungible image is only one of them, and it is also a popular NFT image painting currently.
![](https://gimg2.gateimg.com/image/article/1674116062333.png)<center><font size=1>MAYC. Source: Gate.io</font></center>
## Important Methods to Verify the Authenticity of an NFT
Although NFT artworks are unique, it is still necessary to pay attention to the authenticity of the NFT artworks you invest in when trading or collecting. The authenticity of [NFT artworks](https://www.gate.io/blog_detail/902/Minting--Purchasing-and-Trading-NFT-Art "NFT artworks") can be verified for reference through the following aspects.

### Verify the Identity of the Artist or Seller
Legal NFT sellers will have a blue authentication mark next to their user name on the [NFT market platform](https://www.gate.io/nft/explore "NFT market platform"), and the attributes of the collection will be clearly listed. You can also find the right artists and their works on social media channels or through artists' websites. The most direct way is to ask the artist whether the artwork you want to buy belongs to them and whether he has the correct user profile.
![](https://gimg2.gateimg.com/image/article/1674116111444.png)<center><font size=1>Source: Gate.io</font></center>

### Check the Size and Activity of the Official Website and Community
Always directly visit verified websites for NFT transactions, such as Gate NFT. Browsing the market platform, you can observe the activity of the platform and the sales data of NFT-related artworks, view the transaction history of buyers or sellers, and the participation of creators. Pay special attention to and resist the temptation of the so-called special offer NFT, which may be one of the ways to lure investors to buy.

### Verify Contract Address
Each NFT artwork trading page has contract address details, which can be queried and help you understand the seller's trading situation. Check whether the project creators are honest and transparent about their identity.

![](https://gimg2.gateimg.com/image/article/1674116159555.png)
<center><font size=1>Source: Gate NFT</font></center>

### Beware of Fake NFT Giveaways
In order to attract investors to trade, fraudsters will offer benefits: investors will get a free NFT by registering on the website through their promotional information. However, after the investor registers, the system will prompt you to <a href="/price/link-ln" target="_blank" class="blog_inner_link">LINK</a> your wallet credentials to receive your "giveaways". Once the fraudsters have the credentials entered by investors, they can freely access their accounts and steal assets.

### Google Search for NFT Images
Search the corresponding number on Google for the NFT artwork you want to invest in, or directly search for images.

### View the Sales Volume and Price of NFT
Before [purchasing NFT artworks](https://www.gate.io/price/view/nft "purchasing NFT artworks"), you can check the corresponding prices on the official trading platform. If the price seems to be lower than the price listed on the legitimate trading website, please purchase the investment carefully. This may be a fraud. If the sales volume of NFT artworks is more than the normal trading volume, it may be data manipulation, such as wash trading.

### Reverse Image Search Using NFT

If you are not sure whether this NFT is forged, you can use a reverse image search such as Tiny Eye to see if the seller has ownership of the image.
## How to Buy Real NFT Artworks and Ensure that They Are Not Stolen

In addition to the steps mentioned above to confirm the authenticity of NFT, there is also an important way to choose a trusted NFT trading platform. In addition to ensuring the <a href="/price/flow-flow" target="_blank" class="blog_inner_link">Flow</a> of funds and the transparency of transactions, the platform also has the trust selected by thousands of users and the update of NFT works to avoid becoming the victim of fake websites and fake projects.

A well-known NFT trading marketplace is OpenSea, which is also the largest and most popular market in the NFT field at present. The range of tradable NFT works provided is wide, and it is the place where most of the generated art collections are located. However, creators and sellers need to submit a one-time prepayment fee for the initialization of the account, which is between $20 and $250. It is also required to submit 2.5% of the transaction price to the platform after the trading is completed.

Users can also choose to browse and trade on the **Gate [NFT trading platform](https://www.gate.io/nft "NFT trading platform")**. Gate NFT is created on the basis of the Gate.io cryptocurrency exchange, which has been in operation for 9 years. The exchange has provided a third-party margin for users' cryptocurrency transactions to ensure the security of users' funds. The **Gate NFT platform**, together with artists, trending IPs, and well-known creators, is a first-level market distribution platform for launching high-quality NFT works. The works cover all categories of NFT digital assets such as art, collections, metaverse, music, movies, games, and so on. Artists or creators sell NFT works through the Gate NFT distribution platform, which has the natural advantages of low cost, high return, high liquidity, and community drive.

![](https://gimg2.gateimg.com/image/article/1674116241666.png)<center><font size=1>Source: Gate NFT</font></center>

After selecting a reliable NFT market platform, you should also pay attention to other ways for fraudsters to obtain your privacy information, such as phishing fraud information through messages/emails with links reminding "official address upgrade", as well as false websites, selling NFT risks by auction, [false NFT airdrop](https://www.gate.io/pt/learn/articles/what-is-a-crypto-airdrop/24 "false NFT airdrop"), and impersonating official customer service.

Fraud is everywhere in the NFT field. Investors need to be vigilant when browsing and trading, pay attention to verification and investigation, and avoid becoming innocent victims.
## FAQs on NFT scams

### Can NFTs Be Forged?
Generally speaking, an NFT is unique. Each artwork is embedded with unique coding information for subsequent circulation and trading. However, there will still be some fraudsters who copy artworks and then start selling them after minting them into an NFT, falsely claiming to be officially sold.

### How Do I Know If the NFT Is Real?
The NFT can be verified through tools such as blockchain browser, authenticity digital certificate, and reverse image search. The confirmation methods are mentioned in the content above.

### Can Anyone Forge NFT Ownership?
Even if the fraudster can copy or forge the NFT, it cannot copy and forge the metadata ownership related to the work. The only coding information generated by NFT creators for their artworks is recorded in the blockchain, and users can easily verify their ownership.

### Are some NFT Sales Fake?
This possibility is due to the existence of wash trading in NFT market transactions. NFT wash trading means that the buyer and seller in the transaction are the same person or two people colluding. This is a form of market manipulation. Investors buy and sell the same products simultaneously to create misleading human activities in the market.

### Are Fake NFTs Legal?
Normal virtual property is legal personal assets protected by law. False NFT products are not included.

<div class="blog-details-info">
<div>Author:** Rena W. **, Gate.io Researcher
<div class="info-tips">\*This article represents only the views of the researcher and does not constitute any investment suggestions.
<div>\*Gate.io reserves all rights to this article. Reposting of the article will be permitted provided Gate.io is referenced. In all cases, legal action will be taken due to copyright infringement.
</div>

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Introduction

Are NFT Scams Common?

What is the difference between non-fungible tokens and non-fungible images?

Important Methods to Verify the Authenticity of an NFT

How to Buy Real NFT Artworks and Ensure that They Are Not Stolen

FAQs on NFT scams

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Watch Out for NFT Scams - How to Distinguish True and False NFT?

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