While some NFTs are worth a few dollars, others can cost the same as a house or several houses. But no matter how much an individual pays for their NFT, it’s important to keep it safe.
So, exactly how secure are NFTs and are there any dangers you should be worried about?
What is NFT?
If there’s one thing we know about NFTs, it’s that they’re a bit difficult to understand, especially if you’re not into technology. So, let’s quickly analyze what exactly NFTs are before we find out how safe they are.
Contrary to popular belief, the NFT, or non-fungible token, is not a work of art. Instead, a non-fungible token is proof of ownership of a cryptographically signed version of a particular work of art. These tokens are called non-fungible because, unlike cryptocurrencies, you cannot trade one for another.
People tend to call works of art NFTs, but this is not technically correct. For example, you can trade a dollar for a dollar in the real world, since both have the same value. But you wouldn’t trade a house for a house, because each house is unique in its features and location.
So when you buy NFT, you’re buying a token that proves you own a digital artwork file. This file can be an image, video, audio, or even a GIF. NFTs are usually purchased with Ethereum or Ether, the second most valuable cryptocurrency in the world. Examples of popular NFT collections include CryptoPunks, Bored Ape Yacht Club, and World of Women.
Where are NFTs stored?
Since NFT is an encrypted token, it can be stored on a digital blockchain, just like cryptocurrency transactions. Blockchains are, by nature, secure, as they use an immutable distributed ledger (or distributed ledger technology) that can be viewed by anyone on the network. This makes blockchains very difficult to tamper with.
When you purchase an NFT, you are given a private key that you can store in a digital wallet (provided that the wallet supports NFT). This private key is required to access and transfer your NFT elsewhere and is always kept secret. If you lose your private key, you will no longer be able to access your NFT, which can result in significant financial loss.
Vulnerabilities in the NFT Industry
It is important to remember that the NFT industry has been around for a while but is now huge in size and value. This is why many cybercriminals have chosen to target this market to exploit unsuspecting victims and their precious NFTs.
There are two important pieces of information that cybercriminals will try to access to steal your NFT: your private key and your seed phrase. Your NFT cannot be moved anywhere without using the private key, as this allows you to verify that it was you who made the transaction. On top of that, a seed phrase can grant access to your NFT wallet. Scammers can get your NFT in minutes with this information.
Scammers often use phishing tactics to gain access to your private keys and seed phrases. This is often related to fake emails and websites designed to steal your data. For example, a scammer could impersonate your NFT market account and ask you to log into your account via the link provided to resolve an issue or view recent sales developments. This gives hackers direct access to your market account.
Alternatively, a criminal could impersonate an NFT artist and claim that you won some kind of gift. These scams are fairly common on Discord, Twitter, and Instagram, so be wary if you receive any DMs or see a post offering a link to a giveaway.
These posts or DMs will usually have a link where you will be asked to enter your private key or seed phrase to claim your prize. Remember that you never need to disclose this information to have an NFT sent to you; Only your public wallet address is required for this.
We have a more in-depth section on NFT industry scams if you’d like to read more on the subject, but the bottom line here is that you should always exercise caution when receiving any type of email that provides you with a link. .
Keep your NFT safe
There are several things you can do to reduce your risk of NFT theft, the first of which is to use two-factor authentication for your account. For example, if you have an OpenSea account, make sure you use two-factor authentication so hackers can’t access your account directly without verification from another source, such as email or document.
Also, you should make sure that, if you want to click on any kind of link in this case, you first use a link checker site, which will tell you if the site is legit. or not. Most phishing scams happen through fake links, so using a link checker can mean the difference between avoiding an online scam and ignoring it. one side.
You should also check any accounts that send you messages with airdrops or NFT giveaways. If the account holder claims to be a major NFT artist but has only a handful of followers, chances are, they’re not who they claim to be. You can also report these fake accounts to Twitter and remove them from the platform.
Finally, make sure you always store your private keys and seed phrases in a super secure way, as they provide a gateway to your NFT. You can use a digital wallet to store your NFTs, but many of them are connected to the Internet, making hacking easier.
Therefore, we recommend using cold wallets (without internet connection) or seed phrase tablets to store this sensitive data. Alternatively, you can simply write them down on paper or store them on your hard drive, but you need to make sure it’s in a safe location.
Keeping your NFT safe is paramount
While it’s easy to assume that NFTs are intrinsically secure, cybercriminals are constantly developing more sophisticated methods through which they can access valuable digital assets. friend. So make sure you’re doing what you can to protect your NFT from the hands of malicious actors.
5 Biggest NFT Scams And How To Avoid Them
About the author
https://www.makeuseof.com/are-your-nfts-safe/ Are Your NFTs Safe? The Basics of NFT Security