‘Huge mess of theft and fraud’: Artists sound alarm bells as NFT crime proliferates | Non-fungible tokens (NFT)

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When Lois van Baarle, a Dutch artist, scoured the largest NFT market for her name late last year, she found over 100 works of art for sale. None of them had been hosted by her.

Van Baarle is a popular digital artist, with millions of social media followers. She is one of a growing number of artists whose online images of their art have been stolen, minted as unique digital assets on a blockchain and offered to trade cryptocurrencies on the NFT OpenSea platform. .

The increase in such thefts comes as the market for non-fungible tokens, or NFTs, exploded last year, reaching around $22 billion., attracting Sotheby’s and Christie’s, and resulting in multi-million dollar auctions for these new digital asset ownership certificates.

OpenSea has grown at a dizzying rate and is now valued at $13 billion. But amid its dramatic rise, the company is doing far too little to prevent the to exchange Fraudulent NFTs, some artists charge, and places much of the burden of cracking down on art fraud on the artists themselves.

OpenSea said in a statement, “It is against our policy to sell NFTs using plagiarized content,” adding that it has routinely removed and banned accounts that have done so. The company said it was working on creating new image recognition and other tools that would quickly recognize stolen content and protect creators, and plans to release some of them over the course of the year. first half of this year.

A godsend and a nightmare for artists

In theory, blockchain technology was supposed to make it easier for digital artists to sell unique property tokens, offering buyers a permanent title to the work.

For some artists, technology has opened up a new way to make money : Kenny Schachter, a New York-based video artist and art writer, was an early adopter of NFTs and said he’s made hundreds of thousands of dollars in the past year after three decades of working in an art world in which video art rarely sold.

“We’re in for an incredible proliferation of opportunities for digital artists,” Schachter said. “It’s 1,000% better than a year ago, two years ago, when there was no market for this art.”

But other artists say last year’s crypto boom was a nightmare. One problem is that anyone can “monetize” a digital file as an NFT, whether or not they have the rights to it in the first place, and the process is anonymous by default.

“It is much easier to make counterfeits in the blockchain space than in the traditional art world. It’s as simple as right-clicking, saving,” said Tina Rivers Ryan, curator and digital art expert at Albright-Knox Gallery in Buffalo, New York. “It is also more difficult to fight counterfeiters. How to sue the anonymous holder of a crypto wallet? In which jurisdiction?

DeviantArt, a decades-old online community of digital artists that hosts half a billion digital artworks, began snooping the blockchain for copies of its users’ work last fall after NFTs based on works stolen by Qing Han, a beloved artist who died in 2020 after publicly chronicling his battle with cancer, have been found for sale on OpenSea.

Since then, DeviantArt has sent 90,000 alerts about possible fraud to thousands of its users, company executives said. It now searches for fraud on 4 million newly created NFTs each week. The number of alerts doubled from October to November, and increased by 300% from November to mid-December.

In December, bots began attacking the site, said Moti Levy, chief operating officer of DeviantArt, scraping entire galleries of artists’ work. Pieces will later appear on NFT marketplaces, often with artists’ names and watermarks still attached.

The attacks have focused on DeviantArt’s most popular artists, measured by likes and comments, Levy said, rather than any particular aesthetic.

“Robots are robots,” he said.

“How much of their value comes from stolen art?”

Aja Trier, a Texas-based artist who gained viral fame for painting riffs on Van Gogh’s Starry Night featuring various breeds of dogs, said she discovered 87,000 NFTs based on images of her work for sale on OpenSea, many of which are priced at $9.88 each.

Trier said 500 lists of his stolen work were added in a single night, suggesting the theft was automated and carried out by robots.

The remedy available to her as the legitimate creator of the work, she said, is to write individual copyright takedown requests to OpenSea and manually monitor new fraudulent listings – a work that takes time.

According to Trier and several other artists, the most effective way to get the company to take down their stolen work was to angrily tweet about the issue or speak to the media.

At least 37 NFTs based on Trier’s stolen work were purchased before OpenSea removed the fraudulent listings, Trier said, and she hasn’t seen any of that money come back to her, even though OpenSea makes a $2 commission, 5% on every sale..

“It seems to me that they are making money through illicit behavior,” Trier said. “They have a $13 billion valuation and they are trying to go public. How much of their value comes from stolen art? »​​

The type of fraud the artists complained about represented only a small fraction of its transactions, OpenSea said. It took enforcement action on 3,500 collections of NFTs each week for infringement or copyright reasons, it said, representing 0.175% of the company’s more than 2 million total collections. platform. He said the site now lists more than 80 million individual NFTs.

But the problem of plagiarism, no matter how large, was significant, the company acknowledged: “We are constantly evaluating new ways to do our part.”

At least 37 NFTs made based on Trier’s stolen work were purchased before OpenSea removed the fraudulent listings, artist Aja Trier says. Photography: Pavlo Gonchar/Sopa Images/Rex/Shutterstock

“A huge mess of theft, fraud and inauthenticity”

The current reporting process for artists whose stolen work is turned into NFTs is confusing and cumbersome, confirmed Ashli ​​Weiss, a Silicon Valley intellectual property lawyer who works with blockchain companies, adding that there is currently little incentive for OpenSea and other markets to address the issue. “OpenSea gets paid on every transaction.”

OpenSea challenged the view that it had no incentive to tackle art theft and plagiarism: “For more people to join OpenSea or other Web3 communities, these issues need to be addressed. head on,” a spokesperson said.

More than half of the company’s current staff work full-time or intensively on plagiarism and content moderation issues, OpenSea said, and are developing “intelligent moderation” tools to speed up the company’s response to plagiarism reports.

But the company has also championed some of the policies artists would like to change as central to its mission. While some artists would like to see a crackdown on bots, creating hundreds or thousands of NFTs at a time is normal for the space, OpenSea said, noting that there are 10,000 “Bored Apes” and more than 8 000 “Pudgy Penguins”, two of them. the largest and most commercially successful NFT collections.

Van Baarle, the Dutch digital artist, said she has seen OpenSea’s process for reporting art fraud improve somewhat over the past year. During the first few months she tried to report her stolen art on the platform, the site had a “report” button that never generated a response. At the end of December, she said, it had introduced a reporting form that made it considerably easier to register the fraud, and each attempt generated at least one email response.

But the company can still do more to verify the legitimacy of an NFT before the token goes on sale, she said, rather than let artists play mole with a never-ending streak of anonymous scammers. .

“For a concept that’s supposed to be about authenticity, it strikes me as the opposite,” Van Baarle said. “From where I stand, it looks like a huge mess of theft, fraud and inauthenticity.”

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