What are NFTs and How to Best Protect Them

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A digital identity is an online or networked representation of a person, organization, or electronic device that an individual, organization, or device adopts or claims in cyberspace. Users may project many digital personas through multiple communities. However, security and privacy are essential issues when it comes to digital identity management. While digital identification may seem sophisticated, it is relatively easy. Your digital identity is defined as any personal data linked back to the actual you. Moreover, for instance, photographs you have posted on social media, posts you have made or commented on, your online bank account, and your search engine history.

This is often provided by a national identification authority and includes a collection of confirmed digital characteristics such as a unique identity number, social security number, name, location, date of birth, citizenship, and biometrics. Due to the ubiquity of identity theft on the internet, authentication and validation processes are critical for assuring the security of Web and network infrastructure in the public and commercial sectors. In addition, online identity verification entails ascertaining that a person’s claimed identity matches their actual one. The property of identity is the similarity of one item to another when compared. It is a collection of unique and irreplaceable characteristics and characteristics of a person.

Mobile Digital Identity

Mobile identity verification technologies are a safe method of verifying your digital identity through your smartphone. When creating a new bank account remotely, you may use your smartphone’s mobile browser to prove your identification. It is critical to the remote account opening process since it verifies that an online applicant is who they claim to be. Financial institutions may have confidence in each user’s online digital identity by using secure mobile ID technology to authenticate a customer’s identification. When an institution, such as a bank, has a high degree of confidence in the identification of an online user, this is referred to as a trusted digital identity.

They say that the only constant in the world is change, and as time continues to pass, this has become more evident. The world never really stopped evolving throughout the years– from its customs, beliefs to inventions, everything has changed. That being said, technology is one of the prime examples of changes. 

Enhancement of Technology

Technology is one of the inventions made to make people’s lives more convenient. It ought to help the people in making their tasks easier to fulfill. And for the longest time, it has indeed lived up to its purpose. Technology has also constantly developed to cater to the needs of people. And today, we are enjoying its significant improvements.

NFT or Non-fungible Token is only one of the many technological advancements that people can enjoy.

Non-Fungible Tokens or NFTs became popular within the past year, with our industry’s trading level already moving toward billions in the latter half of 2021. NFTs are a blockchain-based system of owning a particular digital asset.

These virtual assets may include any of the following:

  • Digital artwork
  • Video games
  • Music
  • Collections
  • Sports
  • photos, memes, and GIFs
  • Domain
  • Fashion
  • social media posts

Now that the world almost has a digital version of everything, NFTs are the newest way to enjoy your hobbies. Like mobile identity verification, NFTs are easy to understand and adapt. As a matter of fact, many people have already encountered and tried using NFTs. One famous example is the Axie Infinity. Axie is an NFT-based online video game wherein users can earn money.

But just like any other technological invention, NFTs are also targeted by hackers. Since your earnings are stored in digital wallets, they are prone to cybercrime. This is the same vulnerability that online transactions had to go through. But with the development of FIDO2, which is currently used for online identity verification, NFTs can also be protected. 

FIDO2

The FIDO2 is a robust verification system that was designed to withstand cyber attacks from happening. The FIDO2 protocol uses the standard public key cryptography techniques making it more secure than the outdated authentication methods. 

However, it is important to note that these categories are not the limit of NFTs.

The premise of NFTs is completely different from many digital things – it is developed with unique identifying codes on the blockchain. Each NFT has a uniquely distinguishable digital signature that cannot be duped, ensuring the token’s distinctiveness.

As NFTs continue to gain popularity in the digital world, they keep piquing the interest of various individuals. Still, not all who are interested in NFTs have genuine intentions. The growing investments in this industry have caught the attention of criminals who want to exploit it for illegal purposes. Bad actors will often try to find vulnerabilities in systems so that they can infiltrate them.

Using Identity Verification – NFTs

Often, digital accounts are protected using traditional forms of identity verification like passwords. But these online security measures are no longer enough to keep criminals at bay. A password only proves that the person entering it knows the information and does not confirm that the individual is the real account owner.

Ideally, NFTs should ditch passwords and use other more effective defenses against fraudsters. Many already use biometric identity verification technologies that offer far superior protection than knowledge-based credentials. These modern authentication solutions also enable a seamless user experience, reducing friction in the process.

Protecting NFTs with passwords or other knowledge-based credentials makes it easier for criminals to access accounts. They are quickly susceptible to fraudulent tactics like phishing, SIM swap scams, and account takeover (ATO) attacks. Another reason passwords are ineffective in blocking cybercriminals is that they do not confirm the person’s identity. Once the correct password is provided, even fraudsters can access someone else’s account.

Conclusion

Knowledge-based credentials must be replaced with modern solutions like biometric identity verification to ensure more effective security in NFTs. This authentication method harnesses mobile devices and a person’s biometrics (e.g., fingerprint or facial scans) to securely access their account. It is also challenging to bypass and is not susceptible to the attacks commonly used against passwords.

For more information on NFTs and the ideal security measures to protect them, keep reading this infographic created by LoginID.

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