Crypto Marketplace OpenSea Cracking Down on NFT Fakes

Crypto Marketplace OpenSea Cracking Down on NFT Fakes
Austria's Belvedere Museum released a limited edition NFT of Gustav Klimt's 'The Kiss.' (Image: Ouriel Morgensztern, AP)

In the same way that life imitates art, digital art also imitates the real-life art scene. NFT marketplaces have been experiencing a growing fraud problem with scammers creating fake copies of the non-fungible tokens and selling them online, but at least one company is fighting back.

OpenSea is implementing a new system that will help users spot fake NFTs by filtering out copies with the help of, wait for it, actual humans, the company announced on Wednesday.

One of the largest NFT marketplaces has been experiencing an influx of plagiarism or spam, particularly through the misuse of its free non-fungible token minting tool. “Over 80% of the items created with this tool were plagiarized works, fake collections, and spam,” the company wrote on Twitter in January. In order to crackdown on the digital fakes, OpenSea will introduce a two-part system that combines computer technology that scans all NFTs, and matches them against authentic collection, as well as good ol’ human labour to review the recommendations made by the computer.

OpenSea will also update its verification system, inviting accounts that already hold at least 100 ETH of collection volume, or the equivalent of around $205,000 USD ($284,581) worth of work, according to engadget. Additionally, a collection that has already generated more than 100 ETH in trading volume will be eligible to request badging. Users of the platform will also be required to provide a profile name, username, verified email address and a connected Twitter account in order to be verified.

“We’re committed to threading the needle between removing copymints and giving space for those substantively additive remixes to prosper,” the company wrote in their statement. OpenSea has already started the process of eliminating fake copies from the digital platform, and will scale up its removal process in phases over the next few weeks.

Considering how fast NFTs have boomed in the past year, it’s no surprise that scammers are trying to get in on all the action. As these toddler marketplaces learn how to stand on their own two feet, I’m sure we’ll see a lot more companies roll out similar regulations to try and reel in this digital space.