Trust is a valuable commodity in the digital era, particularly in Web3 and Non-Fungible Tokens (NFTs). An individual sporting a Profile-Picture (PFP) NFT with a legion of followers on Twitter can wield significant influence. Yet, such power can lead to both commendable acts and questionable behavior. This notion has come into sharp focus recently with the popularity and value of NFT collections.
NFT Influencers Aren’t Your Friends
Achieving influential status on social media platforms, particularly Twitter, is a coveted ambition for many emerging NFT collectors. Concealed behind vibrant NFT PFPs, these influential figures dispatch ‘good morning’ messages, disseminate the latest cryptocurrency developments and foster a sense of camaraderie within the Web3 community, especially during market downturns.
This band of influencers has managed to gather enormous followings, running into tens of thousands or even millions in some cases. Yet, with great influence comes great responsibility. Their tweets carry substantial weight, capable of steering public sentiment on whether to purchase or divest from an NFT.
However, the glamour of this role can quickly tarnish when an influencer endorses an NFT project that is later exposed as fraudulent.
The Unraveling Tale of Pixel Penguins
A recent case that garnered significant attention involved Web3 influencer Andrew Wang. Wang, on a Tuesday morning, used his platform on Twitter to promote an NFT collection known as ‘Pixel Penguins.’ The motive behind the promotion was philanthropic; the collection was reportedly created by a friend of his, known as “Sarah” or Hopeexist1 on Twitter, who had been contending with cancer. The sales of these pixel art pieces were intended to help offset her mounting medical expenses.
Despite the prevalence of scams in the crypto space, Wang assured his followers of the authenticity of this project. Furthermore, he declared his willingness to stake his reputation on the validity of the cause, recounting regular conversations with Sarah’s art teacher who vouched for her exceptional talent.
According to Wang’s tweets, each NFT from the Pixel Penguins collection was available to mint for $13. Of the profit, 20% was to be contributed to charitable causes, with the remainder earmarked for Sarah’s medical treatment. This collection wasn’t a new launch; it had been initiated in February, with a Twitter user sharing a similar narrative about the Pixel Penguins in April.
A Disturbing Revelation
Wang’s endorsement significantly boosted Pixel Penguins, encouraging many to mint these NFTs in solidarity with the cause. The collection swiftly sold out, and its floor price escalated to 0.07 ETH, approximately $130, on OpenSea, a popular secondary marketplace.
However, as the day waned, suspicion started to shroud the project’s legitimacy. Twitter users unearthed questionable tweets from Sarah’s account dating back to 2021 and revived prior allegations of art theft. In addition, accusations surfaced that the cancer diagnosis was a fabrication intended to attract donations.
Despite the uncovering of these alarming allegations, the damage was irreversible. The Hopeexist1 Twitter account was promptly deleted, and any digital footprints were meticulously erased. In addition, crypto detective ZachXBT shared Ethereum addresses tied to the Pixel Penguin NFT collection, revealing that the contract had accumulated nearly 61.6 ETH, or roughly $117,000.
A couple of hours later, 63.5 ETH or nearly $119,000 of the proceeds were dispersed to two new wallet addresses. In addition, the scammers seemingly transferred the funds to a wallet on the cryptocurrency exchange OKX, further muddying their financial trail.
This incident serves as a sobering reminder of the caution necessary when engaging with influencers and NFT projects within the Web3 landscape. Despite the allure of an influential Twitter presence and compelling narrative, it’s crucial to conduct thorough due diligence before investing in any NFT collection.
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