People are reporting thousands of dollars worth of crypto art was stolen on an NFT marketplace

  • Multiple people took to Twitter to report the theft of digital artwork on Nifty Gateway.
  • One user said over $150,000 in digital assets has already been reported stolen on the marketplace.
  • A Nifty Gateway spokesperson said there is no indication the trading platform has been compromised.
  • See more stories on Insider’s business page.

Multiple people reported their accounts on Nifty Gateway had been compromised on Sunday, leading to the loss of their crypto art and unauthorized purchases using their credit cards.

A Nifty Gateway spokesperson declined to say how much art had been reported stolen, but confirmed to Insider that a “small group of users” had been impacted.

One Twitter user, @keyboardmoney3, who has been keeping a tally of the reports of stolen artwork, claimed that over $150,000 worth of NFTs on Nifty Gateway has been stolen.

Several pieces were from artists that have generated significant momentum in crypto-art sales, including Trevor Jones, according to the Twitter user.

 

Michael J. Miraflor was one of the first people to report an issue with his account on Twitter. He said someone purchased over $10,000 worth of digital art on Nifty Gateway using his credit card. 

The same person also transferred Miraflor’s digital art pieces to a new account and sold them via Discord, according to a Tweet from Miraflor.

Read more: Here are 4 NFT startups transforming the way we buy art and sports memorabilia

Miraflor said on Twitter he has been in contact with Nifty Gateway co-founder Griffin Cock Foster, but that the co-founder said Nifty Gateway could not transfer the digital tokens back to Miraflor after they had already been resold to unsuspecting buyers.

Now, Miraflor said he’s is in the process of filing a police report.

 

A Nifty Gateway spokesperson told Insider it had not seen any evidence that the platform was hacked and that the impacted accounts were accessed using valid account credentials.

“We have seen no indication of compromise of the Nifty Gateway platform,” the spokesperson told Insider. “The Nifty Gateway team is communicating with a small number of users who appear to have been impacted by an account takeover.”

That means the alleged thefts could be the result of users who reused passwords between other accounts or did not have two-factor authentication — an optional security measure on the site — enabled. 

“We have seen some reports that NFTs involved in these account takeovers were sold in transactions negotiated over Discord or Twitter,” the spokesperson told Insider. “We strongly encourage all Nifty Gateway customers to purchase their NFTs on the official Nifty Gateway marketplace.”

The crypto world has always posed a risk of theft and potential fraud. Since blockchain transactions are anonymous and irreversible, a compromised password poses a significant risk for people who have invested thousands in digital assets.

As Non-fungible tokens (NFTs) take the spotlight as a new hot type of crypto asset, they also bring with them the same risks.

On Thursday, NFTs captured public attention when a piece by digital artist Beeple sold for nearly $70 million on Christie’s.

Nifty Gateway has also become a popular site for buying and selling NFTs. The site hosted an auction for Grimes last month that brought in over $5.8 million in under 20 minutes. 

Nifty Gateway is one of the only platforms that allows users to buy directly from the site using their credit card, while most other sites like SuperRare and Foundations require users to have a digital wallet to purchase pieces using Ether.

Miraflor said on Twitter he had already contacted his credit card provider to prevent future purchases.

Nifty Gateway co-founders Griffin and Duncan Cock Foster told Insider last week the platform is focused on making NFTs as user friendly and accessible as possible.

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