How safe are NFTs? Blockchain technology is supposed to be the safest virtual alternative because it is decentralized. Plus, there is no point of failure, so it’s more difficult to corrupt. Still, there have been instances of NFTs hacking. If one block of the chain is corrupted, theory has it there is no way to access other blocks.
Each transaction that happens on the blockchain is verified through different protocols (also called “consensus method”) and the blocks can’t be modified. However, users can add information to them. So, there are holes in this crypto innovation. Users have to do a lot of self-maintenance, which includes passwords and keychains. Accountability is key for both cryptocurrencies and NFTs. How can you protect your digital assets?
NFTs hacking, tips for your safety
There are different platforms that allow you to create and trade non-fungible tokens, like MintSpace. Since each of them uses different security protocols, it’s up to you to make sure the platform gives you everything you need. Hence, from the safety of your digital wallet to the safety of your NFT code and copyright. It’s important to underline that NFTs are registered on the blockchain and they are directly linked to your e-wallet.
Here are eight tips to protect your assets against hackers for both creators and traders.
Back the information up
Each token has a source file, which includes codes and crucial data. It’s important to back this information up, a precaution that will also ensure you won’t lose any information by mistakes such as deleting or IT loss. This way, creators can make their claim to the NFT and buyers can show they own the digital art, with the limits and rights that go with the contract. Just think of them as a digital vault with unique and personal access.
Use a cold wallet
Since your NFT art is directly linked to your e-wallet, experts suggest you also use a cold wallet. To clarify the terms, digital wallets are referred to as “hot” because they are online. On the other hand, cold wallets are offline. And no, they are not a piece of paper that you can loose any time. Instead, cold wallets are tools similar to USB drives. They are hardware wallets that you should never buy secondhand or from an uncertified seller, so you are sure no one has tempered with them. In these wallets, you can store important information like:
- The seed phrase to recover your account
When you combine a hot and cold wallet, you have less chances of NFTs hacking.
Use a VPN, a virtual private network
First of all, never make any crypto transactions via a public WiFi, like the connection at coffee shops. These networks are easier to hack, compared to private ones. So, make the transactions with a WiFi and connection that has a private and personal password. Even better, make sure to use a VPN. These are virtual private networks that you can download and easily install on your devices. The VPNs ensure anonymity but they also add a level of protection to your PC and smartphone. They are more difficult to hack so your NFTs are safer.
Use a legit NFT marketplace
Sometimes, users trade or share links on social media like Twitter or crypto apps like Discord. While these can be useful to find tips and analysis, they are not legit marketplaces. On social media, hackers abound. Instead, buy and create NFTs on certified platforms, like MintSpace. This way, you will protecting your assets.
What are rug pulls?
This type of scam happens with NFT projects and wannabe investors. Hackers and scammers create a legit-looking website with new digital art and they ask for money and personal information so you get the scoop. But, after the minting and the launch of the (fake) website, these people disappear with the private data and money. Which leads us to the next tip to protect yourself against NFTs hacking.
Sounds fake? It probably is
Hackers can access your information in different ways. They can use emails’ attachments or links via direct messages. It might be common practice, but it’s crucial to reiterate: don’t click on them. If the message or link you received seems or smell fishy, leave it alone. If you are unsure, make a Google search about the sender to double check accuracy of the profile and account. Make sure to check the sender and not make a search about the link itself. If it’s too good to be true, then it might be a trap of NFTs hacking.
Share the glory, not the password
Sure, you can share your success on social media and with your friends. Here’s something you shouldn’t share: your passwords and recovery phrases. This information gives you access to cryptocurrency and NFTs, so your account is only yours.
Always good to remember
Then, there are the tips you already know, but a refresh never hurts:
- Turn on two-factor authentication which includes steps like unique and time-sensitive codes to your cellphone
- Be mindful of fake accounts, especially if you follow crypto forums or conversations
- Don’t share your screen with strangers, like you would on Zoom
If you follow these eight tips, your NFT art will be safer. And it’s time to implement all of them, since hackers are targeting digital tokens.
The latest NFT hacks
Users of popular NFT marketplace Nifty Gateway reported their accounts hacked in 2021. People reported their digital art stolen, but also credentials like credito card information. According to the marketplace itself, none of these users had the two-factor authentication on. Apparently, hackers found their personal information online and then used it to access their Nifty Gateway accounts. Plus, the affected users made transactions of Twitter, which made them more vulnerable to online threats.
Recently, digital art collector Todd Kramer lost over $2 million due to hackers. He also owned Bored Ape Yacht Club, a popular (and expensive) digital token. Kramer was the victim of a phishing scam and he only stored his information in a hot wallet. He couldn’t recover his information and assets quick enough, losing millions in NFTs. Finally, the NFT project Monkey Kingdom lost $1,3 due to a hacker’s attack. How? A representative of the project clicked on a Discord link that looked legit. Except it wasn’t.
While the cases of NFTs hacking are still limited, they might be destined to grow. The hype around digital art is spreading and hackers are quickly catching up to this trend. So, it’s important to protect your creations and purchases. This way, hackers will have a hard time stealing from you.
Is there a way to create and purchase NFTs safely? Read our guide to never miss a beat.