What makes a ‘bad’ NFT? Avoiding costly mistakes

Before acquiring an NFT, you need to establish the technological strength behind the digital artwork. Some NFTs are unfortunately vulnerable to being tampered with or even worse … disappearing! Such an event can naturally cause digital collectibles to lose all their value. So if you want to avoid investing in an NFT that may become worthless in the near future, you need to learn about ‘bad’ NFTs.

NFTs: look for the storage type

The key concept supporting NFTs is ownership; they provide tamper-proof guarantees of ownership to the ones that acquire them. These guarantees exist thanks to the type of storage of digital collectibles: they are located on decentralised blockchain technology. Decentralisation entails that NFTs cannot be controlled or altered by any external authority.

But this is just the theory…

Unfortunately, many NFT projects use centralised ‘off-chain’ storage methods. This leads to appropriation issues: if an NFT is stored on a centralised server, the person or organisation that runs the server can modify it at any time. Would you accept a project team modifying your expansive NFT at their will?

It’s like getting a very expensive tattoo, that meets all your expectations, and waking up one night to see the artist adding a whole new part to it. If you own the artwork, it shouldn’t be modifiable unless you agree to it.

NFTs are not just about artistic qualities, as they can take many different forms: a tweet, a red pixel, a plot of land, a meme etc. With that in mind, it is important to evaluate the technology behind NFTs, because while artistic qualities are subjective, technology isn’t.

Some NFTs do not last, why?

Imagine spending one million dollars on an NFT and waking up one day to find that it is missing! Instead of your precious digital collectible, the only thing left is a ‘page not found’ message. While this may sound like the plot of a black mirror episode, it is unfortunately a very realistic scenario.

The issue relates once again to off-chain storage and decentralised servers. If an NFT is stored on a centralised server, its ‘life expectancy’ is inherently tied with the organisation that runs the server. If the organisation goes under or the NFT project does an ‘exit scam’ the NFT will become a broken link.

The only NFTs that are not at risk of facing these longevity issues are the ones that have their assets (the media and metadata) stored on the blockchain or IPFS — an alternative open source technology to HTTP, focused on speed and security.

NFTs that may not be authentic, how?

As it is the case with a lot of valuable products (paintings, sculptors, antiques), there are a lot of counterfeit NFTs currently going around on the market. One way to verify if an NFT is ‘real’ or not, is to check if its smart contract has been verified on Etherscan — the blockchain explorer.

Some project teams don’t take the extra step of verifying the smart contracts of their digital collectibles. As such, they leave buyers at the mercy of scammers, as they could easily end up buying counterfeits.

How to avoid a “bad” NFT and costly mistakes

Now that we pointed out all the things that could go wrong with an NFT, we can take a look at how to reveal if a particular NFT may be facing some costly issues. As mentioned, there are a few things to consider:

• the overall decentralisation of the assets
• the specific storage methods used
• the verification of the smart contract.

You can verify these manually or use some free tools. If you don’t have the patience or time to check all these manually, check out this free browser extension!

Some of our cool software developers here at Indorse built their own neat tool to find good NFTs — since it works for them, we all decided to share it with the whole community! Compatible with the largest NFT marketplace, OpenSea, this extension (a) provides an overall decentralisation score, (b) reveals where the metadata and media are stored, (c) and inspects if the NFT’s smart contract has been verified on Etherscan.

If you want to buy a digital collectible that is not at risk of falling apart, or being modified, you should always inspect its provenance and where it’s stored.

The nascent world of NFTs is full of possibilities, the whole community is working towards making it as safe as possible. But in the meantime, if you are part of this exciting journey, you should keep a compass to avoid getting lost and costly mistakes…

Free Browser Extension To Verify The Tech Behind NFTs on OpenSea

⚡ Chrome: https://chrome.google.com/webstore/detail/nifty-scanner/eoepooeledpjaoehhokhalpmlmjbedhe
🔥 Firefox: https://addons.mozilla.org/en-US/firefox/addon/nft-scanner/
⭕ Opera: https://addons.opera.com/en-gb/extensions/details/nft-scanner/
🦁 Brave: https://chrome.google.com/webstore/detail/nifty-scanner/eoepooeledpjaoehhokhalpmlmjbedhe