Over the past few years, the crypto industry has witnessed an enormous surge in popularity – and if one thing is for certain, new interest breeds innovation. Non-fungible tokens (NFTs) are an example of such innovation, and they have been sweeping the art world since their inception in 2015, but especially so during the last twelve months.
According to Reuters, NFT sales in the first half of 2021 totalled more than $2.5 billion, piquing the interest of millions of artists, designers, and investors around the world.
If you need a quick refresher, an NFT is a unique, immutable digital asset that can be sold with peace of mind over the internet. Without NFT technology, putting your creative goods up online would be a highly risky manoeuvre, as there would be little to stop someone from making a replica and claiming it was their idea. Also, straight-up theft is a lot easier when your goods aren’t backed up by NFT technology.
The sophistication of this kind of tech has sparked the emergence of new online markets for artists and creators to sell their work on through websites like OpenSea and Axie Marketplace, giving a platform to artists who may not have otherwise had the opportunity to showcase their art. To give you an idea of just how much money is in the business of buying and selling NFTs, let’s have a look at a few of the highest sellers.
The Merge
On December 2nd, 2021, The Merge sold for $91.8 million.
CryptoPunk #7523
As the most expensive of the CryptoPunks NFTs – selling at $11.75 million – is a great example of the exorbitant fees that investors are willing to pay for these one-of-a-kind art collections.
Beeple’s Ocean Front
Beeple is one of the internet’s most successful digital artists. Ocean Front, one of his best works, sold for a whopping $6 million. The list goes on and on.
Now, with organizations such as UbiSoft, Twitter, Coca-Cola, and even the NBA getting involved in the NFT industry, the market is certainly showing no signs of letting up any time soon. However, for the industry to truly take off, there is still a lot of work to be done in order to build the infrastructure up to a point where mass adoption becomes feasible.
EverdreamSoft, a Swiss-based gaming studio founded in 2010, is one of the companies leading this charge, as they use their experience and techniques honed in the blockchain gaming world to meet the rising demands of the NFT industry. Acting as one of the founders of the Blockchain Gaming Alliance, EverdreamSoft is focusing its efforts on producing a rich suite of tools and products that bring the utilization of NFT to the masses, with its ecosystem playing a central role. Their built-in web browser and multi-chain wallet connect to NFT marketplaces, making it simple for players, investors, and artists to transact and interact with NFTs, enriching the experience for all users.
However, despite all of the exciting news coming from the NFT space, it’s important to prioritize security when interacting with others online, especially as the value of these digital assets grows.
How to protect your NFT
With all that capital entering into the space due to NFT mania, the unsurprising reality is that there are plenty of scammers, fraudsters, and opportunists lurking in the shadows. While no hacker can rip you off by making a copy and claiming it as their own (due to the nature of NFTs), there are still plenty of avenues for theft and scams, which can be off-putting for newcomers. On that note, here are some steps you can take to minimize your risk and protect your assets.
Use a non-custodial wallet
Typically, you should at least store your NFTs on a non-custodial crypto wallet and not on an exchange or marketplace. Non-custodial wallets (also known as hot storage) are usually protected by a 12-24 word seed phrase and a combination of touch identification and passwords. For most people and scenarios, this is a very secure method of protecting your assets. However, they are hackable through a variety of methods, such as keylogging, malware, and phishing scams.
Here are some tips on how to minimize your risk of being hacked:
- Never give out your word seed phrase.
- Your password should be made up of a complex combination of letters (upper and lowercase), numbers, and symbols.
- Don’t store your password or seed phrase on your computer. Instead, you could write them down on a piece of paper and store them in a safe place (but not so safe that you forget where you put them).
- A VPN can add a level of security by hiding your IP address and encrypting your internet traffic.
Cold storage
The most secure way to store your NFTs is by using cold storage. Cold storage is an offline, external drive that keeps your assets out of reach of hackers and scammers. Keeping your digital goods on these devices means that no one on the internet can come in contact with your NFT unless they have access to both your physical cold storage device and your passcode. Think of it as a virtual safe for your NFTs.
If you want to purchase a cold storage wallet, there are several highly reviewed wallets available from around $50 to $150. Just keep in mind that using a cold storage wallet means you have to sacrifice convenience for security. This is because you will need to connect and decrypt your cold wallet every time you want to transact with the blockchain, which can be time-consuming.
Never trust a deal that seems too good to be true
Scammers prey on complacency, misplaced hopefulness, and naivety. It’s a cruel world, and the crypto industry can be particularly unforgiving, even at the best of times. While no one wants to believe they will ever be hacked or tricked by a scammer, the truth is that even some of the smartest people still fall victim to their lures. On that note, the best course of defence against NFT scams is to always trust your instincts when something does not feel or look right. If something sounds too good to be true, it probably is.
Here are some quick tips to help you avoid scams in this space:
- Never carry out business with someone who DMs you with an offer that sounds too good to be true
- Always verify the identity and reputation of any buyer or seller you wish to transact with
- Keep your wits about you when participating in NFT drops. Rug pulls are common in this space. Rug pulls occur when artists with little to no previous reputation create a collection, only to abandon the project later and leave you holding a worthless NFT, taking off with your funds in the process
- In general, it’s advised to stick to reputable marketplaces such as OpenSea, Axie, and Rarible
Final Thoughts
NFTs present huge upside potential for all types of digital creators. However, it’s important to note that this new space presents a fertile breeding ground for scammers and fraudsters alike. That being said, taking appropriate precautions to protect your digital assets while also keeping an eye out for scams will ensure you don’t need to experience the heartbreak of losing your creations/investments.
Please note that this is an advertorial. Do your own research.