OpenSea Reveals Features to Prevent Scams and Stop The Resale of Stolen NFTs.
NFTs, News

OpenSea Reveals Features to Prevent Scams and Stop The Resale of Stolen NFTs.

Leading NFT Marketplace by trading volume, OpenSea has revealed today, Oct. 2 a few features that will protect users and prevent thieves and scammers from quickly flipping stolen digital assets. The two-sided feature will involve the detection and disabling of scam links on the marketplace and also being able to identify stolen NFTs and blocking the resale.

OpenSea Pioonering Safety of NFTs

Since the popularity of NFTs, they have witnessed a total of about $86 million in stolen assets, and there seems to be an uptick in 2022. The biggest of these hacks is the Lympho hot wallet NFT hack, where the hacker was able to cart away 165.2 LMT tokens which were equivalent to $18.7 million as of Jan. 2022.

Thefts of digital assets have become a pressing issue in the space, especially since when most transactions occur, they are irreversible. This further worsens when these bad actors sell NFTs to unsuspecting buyers.

Web 3 creators have been clamouring for ways to mitigate these incessant waves of hacks, with OpenSea being at the forefront of this. Earlier today, OpenSea launched two features aimed at protecting users from scammers and interacting with these fraudsters.

To put it into perspective, One solution aims to prevent malicious links from appearing on OpenSea’s platform through a project’s description or a website icon. The tool automatically scans any links entered by users on the marketplace and disables any that point to known scams or redirect clickers to websites with malicious code that could steal NFTs from someone’s wallet.

On the one hand, the tool is based on an expanding blocklist that tracks identified exploits. However, it goes a step further by simulating transactions via any wallet connectivity prompts on the linked website, potentially alerting OpenSea’s system to previously unknown threats.

OpenSea’s second feature to prevent NFT hacks is pretty much interesting; this tool examines suspicious transfers of NFTs and blocks the sale on the platform. In the past, when an NFT was stolen, it would have to be reported by the owner before OpenSea would take action. The downside is that a high-value NFT might have been sold, the fraudster would cart away millions of dollars, and the buyer becomes stuck with a stolen NFT that they can’t do anything with. Though the feature is still in its pilot phase, OpenSea says that it will be trained for years before rolling it out to all users.

“We’re very focused on precision in this bucket rather than breadth,” Fauvre-Willis explained, saying that the automated system will be gradually trained over the next few months before expanding to all users. “We’re trying to be very careful here about balancing that, and making sure the false positive rate is very low when we do this,” She added.

The Way Forward Mitigating NFT hacks

OpenSea had earlier made a change to its policy as the platform said it would require NFT creators to provide a police report claiming that their NFTs had been stolen. This comes on the heels of buyers complaining that they were the ones bearing the brunt of not knowing they were purchasing stolen. The $13.3 billion firm is also collaborating with top wallets like Coinbase wallet and Metamask on best practices to combat scams, and its copymint system has been upgraded to detect and purge copycat NFTs within seconds of minting.

Fauvre-Willis agreed that “things around trust and safety are never over,” and there’s sure to be a constant need for evolution and new solutions as crypto scammers tap new and ever more sophisticated exploits. But these are all still steps towards a more secure and reliable Web3 user experience, she added.

“We do feel perhaps differently than other marketplaces. It’s important that we follow the law, and it’s important that we make this space safer overall,” said Fauvre-Willis. “In the long run, I frankly think we can’t expect the space to grow and expand adoption if we don’t make these investments.”

Bottom Line

NFTs are gaining more adoption with tech giants like Meta and Apple hopping on the NFT craze. Instagram and Facebook recently added support for Solana NFT, and we expect more blockchains will follow suit. However, in order for NFTs to really gain adoption the issue of hacks have to be a thing of the past. OpenSea has started the revolution, we can only wait to see what the future unfolds.