According to blockchain research company Elliptic, over $100 million worth of non-fungible tokens were stolen in the year leading up to July, opening a new front in the hacking crisis facing cryptocurrency.NFTs are assets built on the blockchain that represents digital content like photographs, videos, or texts.
Cryptocurrency-rich speculators invested billions in the assets in 2021, hoping to benefit as prices increased. However, NFT pricing and sales volumes have fallen since the collapse in cryptocurrency prices in May and June of this year.
Despite the market’s collapse, scams are still commonplace, with the biggest amount of NFTs reported stolen ever in July, according to research by London-based Elliptic.
According to the report, social media security breaches would be responsible for 23% of NFT thefts in 2022.
According to Elliptic, thieves made an average of $300,000 for each fraud. Given that not all offenses are made public, the actual number of NFT thefts is probably far greater, it was added.
The crypto business has long been plagued by hacks and frauds, and regulators all around the world are growing more worried about how crypto assets are being used in cybercrime.
Elliptic estimated that just $8 million was being laundered using NFT-based platforms. However, Elliptic said that services like so-called cryptocurrency mixers, which are intended to conceal the source of the money, provided roughly $329 million of the funds in the NFT market.
Before it was banned by the United States this month, Elliptic said that one such mixer, Tornado Cash, was used to launder just over half of the money gained via NFT schemes.”There is a growing threat to NFT-based services from sanctioned entities and state-sponsored exploits,” Elliptic said, citing a $540 million theft in April that U.S. officials have linked to North Korea’s Lazarus Group.
