Before the Super Bowl, an NFT video of Tom Brady sold for $40,712. This leads many Non-Fungible Token users to want to go along with celebrities, but great care must be taken with the vulnerabilities of the blockchain.
And indeed, NFT marketplaces have lost more than $38 million in the past year due to crypto scams.
Tom Brady NFT for $40,000, but Marketplaces Lose More than $38 Million Due to Scam
Before Super Bowl LVIII, a Tom Brady NFT video sold for $40,712. Also the Joe Montana NFTwho previously played for both the Chiefs and 49ers, was sold for $34,000.
The celebrity appeal behind these NFTs could boost demand for other cryptocurrencies, especially with major sporting and celebrity events on the horizon.
However, users should be warned about the dark side of the NFT industry, namely crypto scams.
According to data collected by the Smart Betting Guide, it seems so NFT marketplaces have lost more than $38 million in money due to scams in the past year.
While the blockchain offers benefits such as transparency, decentralization and verifiable authenticity, in practice it can become susceptible to security risks such as phishing attacks, physical theft, malware and social engineering attacks.
NFT Tom Brady for $40,000, but beware of scams: Ethereum is most affected
Smart Betting Guide has compiled several rankings, analyzing a database that records cryptocurrency scams and exploits to identify the most vulnerable platforms and blockchains over the past year.
And indeed, of the more than $38 million that was stolen, 37 million appears to have been stolen from Ethereum users, making it the most targeted blockchain with 97% of scams. Following is the Binance blockchain with over $1 million and Cardano with $25,000.
With these numbers the category of NFT doesn’t seem to be the most affected by all kinds of crypto scams, in fact, it’s just one of them seventh place.
In this sensecryptocurrency bridges lost more than $409 million last year, while “CeFi” saw nearly $250 million stolen by cybercrime in 2023.
In this connection, Zigmas PekarskasCEO of Smart Betting Guide, stated: “
“Some platforms, including NFT databases, are more susceptible to cybercrime than others. When transacting on any of these platforms, make sure you do your research and due diligence. Research the NFT market and the seller, focusing on reviews, ratings, and feedback from other users. This should also be done when purchasing an extremely limited or sought-after item, such as the Tom Brady NFT that was sold before the Super Bowl. Make sure the NFT you are interested in is authentic and not an authorized copy, and check its usage rights. Use a secure cryptocurrency wallet to store your funds and NFT assets, preferably with multi-signature support, and report any suspicious activity or fraudulent entries to the marketplace’s support team as soon as possible.”
Ethereum is the blockchain most affected by crypto fraud
Recently, Smart Betting Guide published another set of results, in which they see Ethereum is the blockchain most affected by crypto scams in the past year.
The study took into account the most common scams, cumulative losses and vulnerable blockchains.
In this sense, £576.6m has been stolen from Ethereum considering all the money that was returned as well. This represents a loss 605% higher than the average among blockchains.
The report added that the crypto scam that led to the biggest loss on Ethereum is misuse of access control. In practice, scammers abuse the system vulnerability to gain direct access to users’ login details or data.