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PeckShield, a blockchain security firm, has released a report showing a notable decrease in NFT thefts in July 2023, with $1.73 million worth of NFTs stolen. The amount marked a 31% decline compared to the previous month and an astounding 89% drop from the peak in February when $16.2 million worth of NFTs were stolen. … Read more
PeckShield, a blockchain security firm, has released a report showing a notable decrease in NFT thefts in July 2023, with $1.73 million worth of NFTs stolen. The amount marked a 31% decline compared to the previous month and an astounding 89% drop from the peak in February when $16.2 million worth of NFTs were stolen. In the first half of the year alone, NFT theft value reached approximately $40 million.
Beyond the monetary value of the stolen NFTs, PeckShield’s analysis revealed that hackers are swift in selling off their illicitly obtained NFTs. Within just 165 minutes, half of the stolen NFTs were quickly sold across various marketplaces. The primary platforms for these sales were Blur(67.3%), followed by OpenSea(19.63%) and X2Y2(10.07%), showing a change from the previous month, where sales were limited to Blur and OpenSea.
NFT sales dropped in July
One of the factors that could have led to the decline in NFT thefts in July is the significant decline in the NFT market volume and sales. According to a report from DappRadar, the NFT market has been severely impacted by the ongoing crypto winter, leading to some of the lowest sales numbers of the year. The statistics show that NFT trading volume experienced a significant decline of 29%, and sales dropped by 23% compared to the previous month. Additionally, the floor prices of top-tier collections like Bored Ape Yacht Club and Azuki sank to their lowest levels in two years. Only Gods Unchained and CryptoPunks showed minimal increases in floor prices, each growing less than 1%.
Compared to January 2023, there were 7.36 million NFT sales, while July saw only 3.7 million sales – a staggering 49% drop. Furthermore, in January, the trading volume amounted to $1.1 billion. In contrast, July declined to just $600 million, the third consecutive month with a trading volume below a billion dollars.
Amidst the gloomy data, there were some positive developments in the NFT market. The Polygon network witnessed a significant surge in activity, attracting 772,424 traders and accounting for 27% of all trades in July. This growth can be attributed to the lower gas fees on the Polygon blockchain than Ethereum, making it an attractive choice for brands like Starbucks, Reddit, and Nike to power their Web3 digital collectible initiatives.
The report also highlighted an intriguing shift in trading patterns. While Yuga Labs’ Bored Ape Yacht Club NFT collection remained the most traded in July, only Mutant Ape Yacht Club and CryptoPunks made it into the top ten collections by trading volume. That marks a significant change from a few months ago when Yuga Labs NFTs accounted for over 50% of every ranking.
Azuki also had three collections in the top 10, but their recovery has been hampered by the fallout from their Elementals mint in June. Criticisms that the Elementals art was too similar to the original Azuki NFTs caused prices to drop by 65%. Nonetheless, the Elementals collection experienced a 55% increase in sales, though the report cautions that a considerable portion of these sales came from traders.
FBI’s rising concern on NFT theft
In response to the concerning rise in financial fraud targeting the NFT community, the Federal Bureau of Investigation (FBI) recently issued a warning. The investigation body warned that cybercriminals are posing as legitimate NFT developers to defraud unsuspecting users actively involved in non-fungible tokens (NFTs).
Per the FBI’s public service announcement, cybercriminals involved in NFT thefts employ various methods to conceal their ill-gotten gains. Typically, stolen NFT contents are laundered through cryptocurrency mixers and exchanges to obscure the trail and final destination of the stolen NFTs, making it difficult to track and recover the stolen assets.
The FBI then urged victims to promptly report fraudulent or suspicious activities to combat these NFT scams. Victims must provide all relevant information, such as links, social media accounts, crypto accounts, and domains used by scammers, and include the keyword “NFTHack” in their reports.
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