NFT thefts decline as FBI exposes new developer impersonation scams

The U.S. Federal Bureau of Investigation (FBI) warned that criminals were posing as Non-Fungible Token (NFT) developers in financial fraud schemes despite the declining number of NFT crimes and token thefts.

The FBI stated that these malicious actors execute their schemes through a dual-pronged approach: either by infiltrating the social media profiles of authentic developers or by crafting nearly identical accounts.

The bad actors endorse fraudulent NFT releases from these social media accounts while concealing their ulterior motives with an aggressive media campaign to create a sense of urgency with phrases like “limited supply, surprise, exclusive mints,” etc.

Once an unsuspecting individual buys into the scheme, they are lured to a fake website via phishing links, where they are urged to connect their crypto wallets to purchase digital assets. The FBI wrote that this usually results in the “transfer of cryptocurrency and NFTs to wallets operated by criminals.”

The law enforcement agency added that the criminals tend to obfuscate their transaction trails by sending the stolen cryptocurrencies through a series of cryptocurrency mixers and exchanges.

NFT thefts declining

On Aug. 6, blockchain security firm PeckShield reported that the number of stolen NFTs declined by 31% in July to $1.73 million. This is a significant reduction from the $2.27 million NFT thefts recorded in June.

PeckShield stated that half of the stolen NFTs were sold on various marketplaces within 2 hours of the theft. Most were sold on Blur and OpenSea, the dominant NFT marketplaces.

Source: PeckShield

Meanwhile, a closer look at the numbers showed that NFT thefts have decreased since the beginning of the year. Apart from February and March, when nearly $27 million worth of assets were stolen, other months have recorded less than $5 million worth of thefts each, according to PeckShield data.

Market observers suggest that the declining trend indicated that NFT thefts might not be as lucrative as they previously were because the floor price of several blue-chip collections has suffered in the current market condition.

In the face of a global decline in NFTs interest, Flow (FLOW) blockchain intriguingly showcases growth and resilience, navigating the wave of Q2 2023 with a blend of remarkable achievements and challenges.

Data from DefiLlama shows that NFT volume has fallen to two-year lows, with OpenSea, remarked in purple, affected the most. Blur, shown in yellow, received significant interest from NFT traders at launch but has also since seen a dramatic decline in volume.

Source: DefiLlama

However, according to a DappRadar report, Flow’s daily unique active wallets (UAWs) rose to an average of 13,169 in Q2 2023, a 1.5% increase from Q1 2023. This reflects an expanded user base, greater engagement, and increased transactional efficiency.

However, the Flow ecosystem wasn’t immune to the global contraction in the NFT market, as it grappled with a 26% decrease in NFT UAWs from 6,294 in Q1 2023 to 4,665 in Q2 2023. The same period saw a 39% drop in trading volume from $23.5 million to $14.4 million.

Yet, amid these challenging dynamics, Flow demonstrated adaptability by launching Doodles 2, an innovative initiative that further solidified its cross-chain relationship with Ethereum.

Sports and Gaming

Unsurprisingly, NBA Top Shot and NFL All Day emerged as leading NFT marketplaces on the Flow blockchain.

NBA Top Shot, offering officially licensed NBA collectibles as NFTs, drew over 1.5 million individuals to the Web3 platform, contributing to 54% of the market share.

A table of the top NFTs by the unique number of traders puts NBA Top Shot in the fourth spot across all NFTs tracked by DappRadar.

Source: DappRadar

Similarly, NFL All Day stood firm with a trading volume of $2.4 million, despite being off-season. According to reports, these marketplaces have significantly grown Flow’s influence in the NFT market, attracting major brands and developers.

Amid a challenging NFT market, sports-related NFT collections thrived on the Flow blockchain, with LaLiga Golazos, UFC Strike, and FanCraze recording impressive trading volumes. This trend underscores a growing interest in sports-related NFTs, revolutionizing sports memorabilia and providing fan engagement and revenue opportunities for teams and leagues.

Flow continued to expand its horizons on the gaming front, including introducing an advanced SDK for the Unity game-building tool. This development and the success of Joyride’s various Blitz games highlight Flow’s expanding functionalities and use cases within the gaming industry.

DeFi Surge

Interestingly, while not traditionally known for DeFi, Flow witnessed encouraging developments in this domain in Q2 2023. Despite experiencing a 9.5% drop in total value locked (TVL), Increment Finance saw DeFi lending surge 100%, reflecting the growing interest among Flow users in decentralized lending solutions. With 70% of Flow tokens staked across 445 nodes and 45,409 delegators, Flow showcases a resilient and user-focused ecosystem.

Despite a slight downturn in NFT sales and trading volume, Flow demonstrated its capacity to innovate and adapt.

Flow Token Performance

As of press time, the price of Flow stands at $0.59, demonstrating a gain of +3.31% in the past 24 hours and a +13.17% rise over the past 30 days.

Flow

From a broader perspective, Flow has experienced a significant -67.63% drop over the last year.

Its current price also stands starkly lower than its All-Time High (ATH) of $43.85, reached on April 19, 2021, marking a -98.65% decline from ATH. Although Flow has navigated through a series of ups and downs, these statistics signify that the token has a long way to go to reach its previous highs.

Still, from supporting large-scale, complex communities tied to blue-chip brands to fostering new partnerships with established Web3 brands, Flow is quietly establishing itself as a persistent player in the space.