As NFT scams proliferate online, crypto sleuths are fighting back

Online scams have reached the lucrative world of non-fungible tokens -- but a group of tech sleuths are fighting back against would-be scammers.

Spend enough time online, and you're sure to run into scammers who try to steal your money by asking you to confirm your credit card information or sign up for fake PC protection plans. Now, online scams have reached the lucrative world of non-fungible tokens (NFTs) -- and a group of tech sleuths are fighting back.

Financial crime specialist and crypto expert Nik Horniacek fell for his first NFT scam in December. Excited about a popular NFT venture that was launching in February, he clicked on a social media link that he thought would lead him to the project site, but instead drained all his cryptocurrency.

Today, Horniacek is the cofounder of Rug Pull Finder, a private intelligence company that investigates NFT projects -- and to date has exposed nearly 200 scams totaling over $1.3 billion, according to the organization. Horniacek is one of many online crypto sleuths that track NFTs as celebrities, companies, political candidates and members of the public embrace the latest cryptocurrency phenomenon.

NFTs are digital assets that cannot be replicated and can be used to represent real-world items. Like collectible artwork and rare baseball cards, the value of an NFT derives from it being unique. The digital tokens are stored in a digital wallet through a decentralized public ledger known as a blockchain, and can be held as digital memorabilia, or sold and traded for investment purposes.