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Security risk prevents many from purchasing NFTs

As NFT technology evolves, consumers will learn about the potential for security risks.

The Seattle NFT Museum features original artworks along with explanations of the technology behind them, and is intended to help visitors navigate the new world of Non-Fungible Tokens. — © AFP
The Seattle NFT Museum features original artworks along with explanations of the technology behind them, and is intended to help visitors navigate the new world of Non-Fungible Tokens. — © AFP

A large percentage of people who are aware of and who have even begun to use non-fungible tokens (NFTs) are also worried about the potential security risks. This is not just a suspicion of something new, for new data suggests that those risks are very real.

A study released from NordVPN has revealed that 68 percent of those familiar with NFTs are also very aware that there are serious security risks associated with NFTs. This is based on a survey of 1,002 U.S. consumers.

NFTs appear to be growing in popularity, at least in some quarters. The survey also finds that just under half of U.S. citizens (47 percent) have some knowledge of NFTs, and 50 percent of those people have already either bought, sold or invested in NFTs. It was also found that 27 percent of respondents had not heard of NFTs.

In terms of the security concerns in relation to the purchase, holding and later sale of NFTs, these breakdown into the following concerns:

  • 51 percent worry that someone can steal their NFT asset, with little chance to recover it.
  • 49 percent fear there are chances of counterfeit NFTs being sold on a fake NFT store.
  • 48 percent are concerned that people are impersonating a famous NFT artist and selling fake NFTs.
  • 48 percent are aware there are fake NFT stores that sell NFTs that are not even present in the digital world.

In addition, almost half of those who had previously engaged with NFTs said they used private browsers to do so. Others utilized extra security measures like password managers (43 percent), file encryption software (37 percent), and virtual private networks (VPNs) (34 percent). Some respondents also indicated they use antivirus software.

Only 8 percent of those polled stated they do not used any security measures at all when engaging in NFT trading.

Commenting on the data, Daniel Markuson, digital security expert with NordVPN, says: “NFTs have quickly become the digital format for owning the modern day collectible.”

He adds: “Now, despite being a well-known investment risk, the security volatility regarding NFTs figures continues to escalate, as recently seen with the $200 million OpenSea NFT heist via a phishing email hack.”

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Written By

Dr. Tim Sandle is Digital Journal's Editor-at-Large for science news. Tim specializes in science, technology, environmental, business, and health journalism. He is additionally a practising microbiologist; and an author. He is also interested in history, politics and current affairs.

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