For several weeks now, many investors have been reporting that their NFTs have been stolen by hackers. These were always resold on the same platform on which they were originally placed: OpenSea. The NFT giant is now facing several lawsuits from disgruntled users.
It’s a phenomenon that’s as fun as it is worrisome, depending on which side of the NFT spectrum you’re on. For about a month now, several holders of non-fungible tokens have been reporting that their collection has been stolen by hackers. Phishing, social engineering or even exploiting bugs, the techniques vary, but the result is always the same: hackers resell the recovered NFTs for less than their original price.
Probably the most notable example is the $2.8 million 91 Bored Ape collection that went missing. The same happened to Chris Chapman, also the owner of a Bored Ape that he put up for sale on OpenSea for about $1 million. Two months later, he receives a notification that his NFT has been bought for $300,000, thanks to an error discovered by a hacker.
OpenSea draws the ire of all users
Within a few months, OpenSea has become the number one platform for buying and selling NFTs. After raising $400 million from investors, the company is now valued at $13.3 billion. A success that it owes in part to its extremely efficient business model: OpenSea receives a 2.5% commission on every sale. Only then did OpenSea certainly not foresee its exponential rise in popularity.
As a result, many now believe that the platform is absolutely not safe and that everyone is at risk of getting scammed in one way or another. The company has “made a lot of stupid mistakes,” said Chris Chapman, adding that its leaders “don’t really know what they’re doing.” It is clear that unfortunate events follow one another on the platform and that the latter is very helpless in view of the magnitude of the phenomenon. Today, many users accuse OpenSea of not blocking the reselling of stolen NFTs by hackers, as this would prevent it from earning the commission. The company is currently involved in four lawsuits.
Piracy, Theft, Plagiarism: OpenSea, the Wild West of NFTs
Forced to respond, OpenSea assured that it is working hard to improve the security of its platform. “Like any tech company, there’s a time when you catch up,” said Devin Finzer, the company’s CEO. “You’re trying to do everything you can to accommodate the newest users coming into the space.” Credits: Unsplash Another big problem, OpenSea doesn’t seem to have an effective system for recognizing works. DeviantArt, another platform for artists, said more than 290,000 works posted to the market are in fact plagiarism of works posted to its site.
OpenSea has nevertheless implemented an algorithm that scans every published NFT, but only compares it with other NFTs on its own site. These problems come at an already stormy time for Open and for the NFT world in general. In recent times, searches on Google related to the topic have dropped by 75%. NFT sales are down 90% since September last year. While enthusiasm for the technology on the part of the general public seems to be waning, OpenSea is also facing increasing competition that could well take advantage of its security flaws.
Media coordinator and junior editor at Research Snipers RS-NEWS, I studied mass communication and interested technology business, I have 3 years experience in the media industry.