While the support from numerous A-list celebrities expedited the nonfungible token (NFT) boom of 2021 and 2022, some promoted unvetted projects to fans without knowing if they were legitimate or scams. The practice retains its popularity in 2023 as markets recover.
We just tricked Dillon Danis into promoting a fake NFT project. We paid him $1,000 to post, he didn’t disclose it was an #AD, and posted copy that literally spells out S.C.A.M. pic.twitter.com/SVo2SCoN9q
— Coffeezilla (@coffeebreak_YT) February 3, 2023
In the promotion, Danis tweeted out a digital image with a website URL, which, according to Coffeezilla, “literally spells out S.C.A.M.” A further investigation from Cointelegraph shows that the website was newly created on Feb. 1, 2023 — an important clue to check when checking the credibility of new projects.
Moreover, the website FAQ mentions that no investors can get hold of the “Sourz” NFTs, a crucial piece of information overlooked by the MMA fighter.
A similar incident involving Kim Kardashian was flagged in June 2021 by the United States Securities and Exchange Commission (SEC) when she promoted EthereumMax (EMAX) crypto token to her 330 million Instagram followers. According to the SEC, Kardashian violated the anti-touting provision of the Securities Act by failing to disclose the $250,000 she had received for the promotion.
However, Coffeezilla ensured that the users who fell for the scam NFT project were notified immediately. When users click the “Mint Sourz” button (as shown in the above screenshot), they are redirected to a website that cautions against a possible scam.
While Coffeezilla plans to share more information through a follow-up video, the incident is a strong reminder for influencers and investors to do their own research before promoting or investing in a project.
Related: FBI seizes $100K in NFTs from scammer following ZachXBT investigation
Little Shapes NFT, a project launched in Nov. 2021, was a “social experiment” designed to shed light on large-scale NFT bot network scams on Twitter, according to pseudonymous founder Atto.
Thanks for participating everyone – Little Shapes was a social experiment by @BALLZNFT_
The exposé was real though. Here’s how a ring of influencers and founders drained $200,000,000+ out of the ecosystem over 274 projects: https://t.co/BKMSqPVwzw (158 Pages) pic.twitter.com/gB5v21NCRo
— Little Shapes NFT (BALLZ) (@LittleShapesNFT) February 1, 2023
“I needed a story that sells to make sure no one would ignore a story that hurts,” explained Atto when explaining his intent behind launching the NFT project.
Little Shapes was marketed as an upcoming avatar-style project with 4,444 NFTs that would allow owners to interact and change the artwork in real time.