welcome to the dark side of crypto art

With the wave of NFTs, a new cybercrime has swept across the art world over the past year. A multi-million dollar token is stolen in seconds, and illegal copies swarm at the speed of light.

I lost all my monkeys and mutants right now, anyone bought it ??? pls touch me! »(« I just lost all my monkeys and mutants, anyone bought them ??? Please contact me! “) collector Larry Lawliet was alarmed Twitter February 1st. The one who, not without humor, now shows up on his profile ” Him who stole the NFT for millions of dollars »(« Him who was robbed of millions of NFT dollars ) was stolen from the OpenSea platform 13 non-fungible tokens by “Bored Ape Yacht Club” and “Mutant Ape Yacht Club” for $ 2.7 million. The same mishap happened on December 30 last year for New York gallery owner Todd Kramer, who quickly lost 15 non-fungible tokens worth a total of $ 2.2 million.

Raid on digital wallets

Both were hacked by a hacker by clicking on a malicious link that gave access to their crypto wallet (i.e. their crypto wallet that allows storage of cryptocurrencies and NFTs). ” The username and password of the crypto wallet used to connect to all sites connected to blockchain, there is a potential risk of hacking if you connect to a new site or platform that you do not know. Additional security is the use of one “hard purse”a physical crypto wallet that is not connected to the Internet that looks like a USB key warns Fanny Lakoubay, crypto artist and NFT’s advisor at LAL Art Advisory. An important precaution when you know that the terms of service for a platform like OpenSea indicate: ” your access to and use of the Service is at your own risk. We will not be liable or liable to you for any loss »…


In addition to these thefts of NFTs, counterfeits are on the rise. Last September, the Picasso Administration (the company that manages the intellectual property rights attached to the work and to the artist’s name) had an NFT by artist Trevor Jones, representing a Picasso bull, withdrawn from sale at Christie’s. animation found today on OpenSea. On January 24, Hermès filed a civil lawsuit in federal court in New York against artist Mason Rothschild, alleging that his series of MetaBirkin’s NFTs posted on the OpenSea platform (Birkin bags, emblematic of the brand ) constituted an infringement of the luxury brand.

The MetaBirkins series of NFTs, reinterpretations of Hermès' famous Birkins bags, have been released for sale on the OpenSea platform by digital artist Mason Rothschild (MetaBirkins screenshot. Metabirkini's website screenshot)

The MetaBirkins series of NFTs, reinterpretations of Hermès’ famous Birkins bags, have been released for sale on the OpenSea platform by digital artist Mason Rothschild (MetaBirkins screenshot. MetaBirkins website screenshot)

In this case, it is first possible to ask the platform to remove the works from sale, as most platforms hosted in the US are required to apply the Digital Millennium Copyright Act (“DMCA”), which obliges them to fight against the distribution of content when it infringes copyright or image rights Says Louise Carron, a lawyer at Klaris Law in New York, specializing in art law and NFTs.

7 million NFTs mistakenly attributed to Picasso

Today, if you report an infringing link to Opensea, they should refer to it, but that is link by link. For some particularly vulnerable artists, that mission is impossible. To date, for example, there are more than 7 million NFTs incorrectly attributed to Picasso on the platform … There are also a lot of counterfeits of works by our most famous members, Miro, Chagall, Magritte and Warhol, but fortunately, they do not sell , ”Notes Thierry Maillard, Legal Director of the Society of Authors in the Graphic and Plastic Arts (ADAGP). With great humor, counterfeiters multiply Picasso Punks and Magritte Punks sold in ether.

Screenshot of OpenSea online sales platform showing the results of the search

Screenshot of OpenSea online sales platform showing the results of the search “Picasso punks” on February 16, 2022.

Legally, we can not say to OpenSea: “we, ADAGP, we manage the rights of Miro, Chagall, Magritte and Warhol, we have never approved the online distribution of NFTs related to works by these artists, block them systematically if you see anyone appear.”because they can claim refuge behind their host status “.” The European Directive from 2019 (Copyright in the Digital Single Market, DAMUN) strengthens the obligations for content sharing platforms such as YouTube, Twitter or Facebook, but its application in marketplaces such as Opensea remains complex ”Adds Thierry Maillard.

80% of plagiarized works, fake collections and spam

Fake collections are also legion, just as Ape’s official club uses the graphic identity of the Bored Ape Yacht Club. ” As soon as a new project with a small tap appears, ten projects with similar names immediately appear. Everything goes very fast and people get scammed and buy the wrong one. For security reasons, it is better to arrive via the project’s website or Twitter account on the Opensea platform “, Recommends Fanny Lakoubay. We also want to make sure there is a blue mark confirming an account or collection, as on Twitter. The platform acknowledged this itself in a tweet on January 28: its “lazy embossing” system, which allows NFTs to be created without advance transaction fees, has led to a “ abuse of this function, which has increased exponentially. Over 80% of the items created with this tool were plagiarized works, fake collections and spam “.

A not so smart smart contract

What we lack in the legislation is the obligation to verify the identity of persons to ensure that the creator of the NFT has the necessary intellectual property rights. The license to use the work associated with NFT, in particular the reproduction rights, is another point of vigilance. As the conditions of use of the platforms vary, artists or rights holders must not find themselves giving the buyer of the NFT usage rights to their works without being aware of it by returning to the principle of copyright independence. the material property of the work and the intellectual property , ”Adds Thierry Maillard. There are still royalties in case of resale of NFT: ” It is a great advantage for NFTs to set up a commission system so that royalties are automatically paid to the author through the smart contract (“intelligent” contract in theory that can not be forged in the form of computer code running automatically and without a trusted third party editor’s note)but it only works if it is well designed and varies by platform conditions says Louise Carron. A legal and fiscal UFO, NFT requires regulation as soon as possible.

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