- MetaMask, Trust Wallet and Math Wallet are the most commonly used wallets
- 16% of respondents said their accounts on NFT platforms had been previously hacked
From multi-million dollar rugpulls to user exploits on marketplaces, investing in NFTs can be fraught with risk.
Half of NFT owners have lost access to at least one of their digital collectibles before, according to a March 8 report by research firm PrivacyHQ.
The study, which polled over one thousand collectors, showed two out of three NFT investors “panic sold” one of their blockchain-based collectibles last year.
Justin Kan, co-founder of NFT gaming marketplace Fractal and streaming platform Twitch, told Blockworks users should follow precautions to safeguard their assets.
“There [are] a high level of rugpulls and scams [in NFTs],” Kan said. “[But] hopefully as the space matures, companies will be able to provide protocols that will be able to [offer] this kind of security for their users.”
“You should have a burner wallet when you’re minting, have a cold wallet for storage of your NFTs, and you should be aware of phishing attacks.”
Per the survey, 16% of respondents said their NFT platforms had been hacked, but roughly 90% said they were able to recoup losses in some capacity.
MetaMask, Trust Wallet and MathWallet are the most popular NFT wallets — with MetaMask believed to be the safest.
“Don’t [click on] links,” Kan said. “We [recommend] typing out Fractal.is in your browser. Now, people in Web2 are going to [say], ‘That’s insane that you have to do all these protections.’ But I think it’s the cost of having true ownership of [something.] You kind of have to rebuild the space from the ground up.”
Security concerns, however, didn’t seem to slow the exponential growth of the industry last year. NFT sales reached $17.7 billion in 2021, up from $82.5 million in 2020, according to a Thursday report from NonFungible.