With all the promises about safety and security currently being touted in the blockchain space, one would think scammers would need to find unique and creative ways to rob blockchain users of their assets. As it turns out, the only creativity required is the ability to open a Photoshop document and cut and paste a verified logo on top of a screenshot of a valuable asset.
A recent Twitter thread from an anonymous Twitter tracking account that monitors Apes sold for 5% under the floor price revealed the details of a horrifyingly simple scam. According to them, when an Ape is sold by more than 5% under the floor price, this means either the owner is panic selling or is compromised.
In the last two weeks, another owner of the prized and esteemed Bored Ape Yacht Club NFTs has suffered losses totaling an estimated $570,000. The owner, who shall remain anonymous but is referred to as “s27”, used a service known as “swapkiwi” to trade his collection for other NFT assets. Unbeknownst to him, a scammer would exploit a very basic loophole to steal his assets. s27 lost access to his “Bubble Gum Ape” and the matching Mutant Apes in the most straightforward manner.
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As you can see in the image above, assets proposed in a trade/swap will have a verification sticker in the bottom right corner of the asset. This verification check mark confirms the asset as being authentic. Unfortunately for s27, if a user decides to take an image and add an identical verification sticker in Photoshop, followed by uploading this edited and fraudulent image to the platform, there are no mechanisms to verify this asset is authentic. A scammer was able to make copies of an asset, add a checkmark, and upload them as their own. No checks and balances. The result was that s27 sent their three Apes to the trade offerer and, in return, received three fraudulent NFTs.
Moral of the story? On a basic level, everything needs to be verified. Protect your assets by avoiding offers that seem unrealistic because, in most cases, they are.
On a more complex level, utilize new services aiming to protect you and your assets. At NEST®, we introduce Provenance Certifications and IP Asset Registration, linked to your own verified Self-Sovereign Digital Identity. These words sound complex, but they are quite simple. A Self-Sovereign Digital Identity is your digital ID card. It is linked to all of your digital assets. Provenance Certifications are generated to show the origin of an asset and link the current owner’s digital identity card to the asset. IP asset registration registers your asset in a growing database of digital assets and protects against reminting. These solutions will pave the way for a safer ecosystem and, as a user, ensures your right to true ownership and protection.
