Nonfungible tokens are all the rage and the trend has caught on with some of the most famous people in the world. The likes of Argentina and Paris Saint-Germain star Lionel Messi, the rapper Eminem and the socialite Paris Hilton are just a few of the latest public figures to have hopped on the NFT train, snapping up the rights to trendy digital art.
NFTs are secure, blockchain-based records that represent digital media. They’re purchased with cryptocurrency, and much like the priceless nature of a Van Gogh or a Matisse, the original is worth far, far more than the trimmed down print copy sold at the museum for a few bucks.
One of the latest trends around NFTs such as the Bored Ape Yacht Club collection has been for the rich and famous to use those images as their profile pics on their official social media accounts. Eminem paid $460,000 in Ethereum to get his hands on the Bored Ape #9055 and immediately made it his Twitter profile pic, while the U.S. DJ Steve Aoki did the same with his personal Character X NFT.
How NFTs Fuel Doxxing
By using their NFTs as profile pics, celebs have an easy way to vocalize their support for all things crypto and add many more followers to their fan base, but doing so may not always be such a smart move. For NTF ownership makes some public figures an easy target for doxxing which could bring their entire history of crypto transactions to light.
The traceability of NFTs is a powerful thing. Discovering the owner of any specific NFT is an easy task, because the smart contracts that manage NFTs store the unique token ID and metadata of each one. Once you have the token ID, it only takes a few seconds to look for the associated owner address in the blockchain itself.
NFTs are intentionally traceable because the idea is that whoever owns them can prove it. However, this traceability by design could potentially come back to bite some unwitting public figures if they happen to have something to hide.
Once you know for certain an NFT is associated with a particular individual, and you discover that person’s wallet address, it’s a fairly simple task to identify that person’s entire history of crypto transactions. Or at least, the ones associated with that same address.
Public figures who buy NFTs and show them off to the world are therefore running a real risk of being doxxed, where other wallets they use might be identified and spammed, and certain transactions they’ve made in the past could be scrutinized.
One recent example saw the co-founders of the Bored Ape Yacht Club themselves being unwittingly doxxed:
— Guy Oseary (@guyoseary) February 5, 2022
Doxxing has destroyed the reputations of more than a few individuals. Another recent case involved the famous YouTuber SteveWillDoIt. Best known for his outrageous stunts and challenges, such as downing an entire bottle of vodka in one and eating 15 burgers in a single sitting, SteveWillDoit amassed over 4.2 million subscribers on YouTube.
It seemed as if things were going well for SteveWillDoIt until an investigation by another popular YouTuber, Cofeezilla, revealed that he was essentially scamming his own fans by promoting a crypto betting website known as Roobet, and falsely claiming to win big prizes.
The documentary, ROOBET’S HOUSE OF CARDS EP. 1,revealed SteveWillDoIt earned almost $1.7 million in affiliate fees for promoting Roobet, despite never actually using his own money to place his bets. As Cofeezilla showed, an investigation of Ethereum blockchain transactions showed that all of SteveWillDoIt’s bets were funded by a wallet owned by Roobet. He was effectively being paid to promote an unregulated betting platform.
The exposure resulted in SteveWillDoIt’s downfall, and although he did apologize in an interview, he ultimately deleted his entire library of YouTube videos and has not posted another one since.
Dodging the Doxxers
The doxxing of SteveWillDoIt’s and other celebs crypto transactions highlights one of the main disadvantages of crypto – the complete and utter lack of privacy, at least with more traditional coins like Bitcoin and Ethereum.
But for SteveWillDoIt it didn’t have to be that way. There are actually a number of ways to ensure crypto transactions can remain private and untraceable. The most obvious way is to simply use one of the popular privacy-focused cryptocurrencies, such as Monero, which is based on an opaque blockchain that masks every single address to keep things private.
Not everyone wants to transact in Monero though. In that case, another option might be what’s known as “Bitcoin Mixing”, which involves sending coins to a service such as Smartmixer or Wasabi Wallet. Those services effectively break the link between two wallet addresses during any transaction, bouncing them around multiple wallets and mixing them with others, before finally sending the fund to the intended address. They ensure transactions are untraceable, but such services aren’t perfect, for users have to pay a fee for each transaction. In addition, they only support the most popular cryptocurrency, Bitcoin.
Perhaps the most superior method is to instead use a dedicated privacy wallet. One of the most popular options is BlockWallet, a non-custodial Ethereum browser extension wallet that can also interact with DeFi apps, much like MetaMask does.
BlockWallet’s standout feature is its privacy smart contracts that hide both the amount, and the origin of each transaction. With BlockWallet, users can create a new wallet address each time they receive a payment, originating from a smart contract where every user’s funds are pooled together. BlockWallet achieves this through the use of ZKsnarks, which are cryptographic proofs that ensure each transaction is obscured.
With BlockWallet and other anonymous crypto wallets, the reality is that your transactions will never be revealed. For public figures and their growing collections of highly traceable NFTs, YouTubers engaged in dodgy deals and other celebs who’ve joined the crypto craze, this level of privacy might prove to be even more valuable than the contents of their wallet.