Guide: How To Safely Invest in Crypto, NFTs and Digital Assets

Steve Huff
Steve Huff is an Editor and Reporter at dot.LA. Steve was previously managing editor for The Metaverse Post and before that deputy digital editor for Maxim magazine. He has written for Inside Hook, Observer and New York Mag. Steve is the author of two official tie-ins books for AMC’s hit “Breaking Bad” prequel, “Better Call Saul.” He’s also a classically-trained tenor and has performed with opera companies and orchestras all over the Eastern U.S. He lives in the greater Boston metro area with his wife, educator Dr. Dana Huff.
crypto coins
Photo by Quantitatives on Unsplash

With the continually surging popularity of cryptocurrencies and NFTs, there has been an increase in scams targeting unsuspecting consumers. Even “ crypto winter” hasn’t slowed grifters looking to make big bucks by ripping off crypto and non-fungible token enthusiasts. In an August report, blockchain analytics firm Elliptic noted that investors had lost $100 million to NFT scams between July 2021 and July 2022. That was pocket change compared to cryptocurrency thefts—also in August, blockchain analytics firm Chainalysis reported $1.6 billion in total crypto losses from hackers attacking services designed to help investors transfer digital assets from one network to another.

Moneymaking potential in cryptocurrencies and NFTs is touted across the web, but the potential for digital highway robbery is just as great. That’s why it’s a good idea to armor yourself with information about how to avoid the many dangerous dark alleyways found along the blockchain’s supposed paths to wealth.

Scams can take many forms, from fake investment opportunities to phishing attacks. For example, “Web 3 Is Going Just Great” reports that in May 2022, a crypto project was launched with the title “Day of Defeat.” The project's developers called it a “radical social experiment token” that promised, “to give holders 10,000,000X PRICE INCREASE.” This meant anyone who purchased $1 of the token would receive massive rewards.

By the time the token’s price plummeted by 96%, investors had purchased $1.35 million worth of coins. Unfortunately, the scammers took all the liquid assets with them. It was a classic “ rug pull.” That’s an apt term to describe what happens when investors are lured to a new crypto investment opportunity only to have the developer pull out and usually vanish—websites and social media accounts deleted or locked. Rug pulls aren’t that new, but crypto’s widespread adoption has provided plenty of opportunities for the sufficiently motivated to create new ones.

In June 2022, actor Seth Green fell prey to a classic phishing scam focused on his Bored Ape Yacht Club (BAYC) NFTs. After Green bought legit Bored Apes, someone sent him a phishing email disguised as an alert about sketchy activity on his OpenSea account, where his apes were stored. He followed a link from the message to a site that looked enough like OpenSea to fool the Robot Chicken co-creator into typing in his login information. But as is usually the case with a phishing scam, Green’s info was sent to a command and control server where it was accessible to whoever built the fake login page.

In no time, hackers had grabbed some of Green’s most valuable NFTs and sold them to another account. As a result, the actor had to pay at least $260,000 to get his Bored Apes back.

While Seth Green was getting in on the latest thing—as Hollywood creators like to do—you can take steps to reduce your risk of falling into the trap that ensnared him.

Here are six to start:

Do your research

person using MacBook proPhoto by Austin Distel on Unsplash

Before spending a dime, examine the account offering the NFT or tokens. Does the marketplace offer verification? Opensea, for example, verifies accounts with a blue checkmark. It requires specific benchmarks for verification, stating that an account that owns “collections with at least 75 ETH of volume sold” may qualify if they also “meet other criteria like minimum activity levels and social presence.” Ensure you’re buying from a seller with a checkmark.

Use reputable platforms

Bitcoin wallet in 3D. Feel free to contact me through email Check out my previous collections “Top Cryptocurrencies” and "Elon Musk" . Photo by Mariia Shalabaieva on Unsplash

Crypto and NFT purchases generally require setting up a digital wallet. To that end, there are plenty of sites offering crypto wallet functions. Still, only the ones that have been around for a few years (Coinbase, for example, launched in 2012) and have real name recognition can guarantee that they at least take security very seriously. Known and generally reliable sites offering wallets include Coinbase, Trezor, Metamask,, and Ledger. Of course, those aren’t the only ones; they’re a good place to start.

Use the wallet’s security settings wisely

two pink padlock on pink surfacePhoto by FLY:D on Unsplash

Good wallets have the kind of security protocols we might expect from our banks or email accounts. For example, using two-factor authentication is a must, especially if you don’t want to end up paying through the nose for apes you’d already purchased, like Seth Green.

Look for rug-pull red flags

woman sitting on bed with MacBook on lapPhoto by Victoria Heath on Unsplash

These include mysterious, anonymous developers. If you research projects on Twitter, for example, there are frequent mentions of “doxxed” developers. In this context, doxxed just means the devs are telling potential investors who they are, likely with an open, transparent, and consistent web presence that goes back further than just a few months. Be wary of new social accounts and examine websites and white papers describing the project and its purpose. If they are vague or the sites seem thrown together (multiple pages with no content or TBAs), be very wary.

Be suspicious of 'pie in the sky' promises regarding profits

10 and 20 us dollar billPhoto by Alexander Schimmeck on Unsplash

If you refer back to “Day of Defeat,” the project that rooked investors to the tune of $1.35 million, one of the easiest methods of spotting a possible scam is right there—the promise that those who purchased tokens would see a 10,000,000X increase in price. CoinTelegraph puts it succinctly in their recommendations about taking care with crypto and NFTs: “If the yields for a new coin seem suspiciously high, but it doesn’t turn out to be a rug pull, it’s likely a Ponzi scheme.”

Look for skewed numbers

turned on monitoring screenPhoto by Stephen Dawson on Unsplash

According to Matthew Callahan—founder and CEO of Delphi, a Web3 consulting agency—other red flags to watch out for include projects where the number of “Twitter and Discord follower numbers seem disproportionate to their engagement.” That is, small numbers of users contrasted with active, vocal engagement can suggest sock puppetry at work. Callahan also suggests that “advertising the project on Twitter/Instagram” could be a red flag. Why? A paid ad campaign could indicate an attempt to obscure a lack of organic engagement. The account isn’t relying on word of mouth so much as paid views, which artificially boosts its profile, obscuring the fact that there’s “no real community engagement on social platforms.”

Frankly, there is still no surefire way to avoid all online scams. The key is to be a little paranoid, ultimately. Keep your digital head on a swivel, check all corners, and don’t go big at the start. Extra vigilance will improve your chances of not getting scammed into oblivion.

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How the 'Thrift Haul' Trend Boosted the Secondhand Ecommerce

Lon Harris
Lon Harris is a contributor to dot.LA. His work has also appeared on ScreenJunkies, RottenTomatoes and Inside Streaming.
How the 'Thrift Haul' Trend Boosted the Secondhand Ecommerce
Evan Xie

If you can believe it, it’s been more than a decade since rapper Macklemore extolled the virtues of thrift shopping in a viral music video. But while scouring the ranks of vintage clothing stores looking for the ultimate come-up may have waned in popularity since 2012, the online version of this activity is apparently thriving.

According to a new trend story from CNBC, interest in “reselling” platforms like Etsy-owned Depop and Poshmark has exploded in the years since the start of the COVID-19 pandemic and lockdown. In an article that spends a frankly surprising amount of time focused on sellers receiving death threats before concluding that they’re “not the norm,” the network cites the usual belt-tightening ecommerce suspects – housebound individuals doing more of their shopping online coupled with inflation woes and recession fears – as the causes behind the uptick.

As for data, there’s a survey from Depop themselves, finding that 53% of respondents in the UK are more inclined to shop secondhand as living costs continue to rise. Additional research from Advance Market Analytics confirms the trend, citing not just increased demand for cheap clothes but the pressing need for a sustainable alternative to recycling clothing materials at its core.

The major popularity of “thrift haul” videos across social media platforms like YouTube and TikTok has also boosted the visibility of vintage clothes shopping and hunting for buried treasures. Teenage TikToker Jacklyn Wells scores millions of views on her thrift haul videos, only to get routinely mass-accused of greed for ratching up the Depop resell prices for her coolest finds and discoveries. Nonetheless, viral clips like Wells’ have helped to embed secondhand shopping apps more generally within online fashion culture. Fashion and beauty magazine Hunger now features a regular list of the hottest items on the re-sale market, with a focus on how to use them to recreate hot runway looks.

As with a lot of consumer and technology trends, the sudden surge of interest in second-hand clothing retailers was only partly organic. According to The Drum, ecommerce apps Vinted, eBay, and Depop have collectively spent around $120 million on advertising throughout the last few years, promoting the recent vintage shopping boom and helping to normalize second-hand shopping. This includes conventional advertising, of course, but also deals with online influencers to post content like “thrift haul” videos, along with shoutouts for where to track down the best finds.

Reselling platforms have naturally responded to the increase in visibility with new features (as well as a predictable hike in transaction fees). Poshmark recently introduced livestreamed “Posh Shows” during which sellers can host auctions or provide deeper insight into their inventory. Depop, meanwhile, has introduced a “Make Offer” option to fully integrate the bartering and negotiation process into the app, rather than forcing buyers and sellers to text or Direct Message one another elsewhere. (The platform formerly had a comments section on product pages, but shut this option down after finding that it led to arguments, and wasn’t particularly helpful in making purchase decisions.)

Now that it’s clear there’s money to be made in online thrift stores, larger and more established brands and retailers are also pushing their way into the space. H&M and Target have both partnered with online thrift store ThredUp on featured collections of previously-worn clothing. A new “curated” resale collection from Tommy Hilfiger – featuring minorly damaged items that were returned to its retail stores – was developed and promoted through a partnership with Depop, which has also teamed with Kellogg’s on a line of Pop-Tarts-inspired wear. J.Crew is even bringing back its classic ‘80s Rollneck Sweater in a nod to the renewed interest in all things vintage.

Still, with any surge of popularity and visibility, there must also come an accompanying backlash. In a sharp editorial this week for Arizona University’s Daily Wildcat, thrift shopping enthusiast Luke Lawson makes the case that sites like Depop are “gentrifying fashion,” stripping communities of local thrift stores that provide a valuable public service, particularly for members of low-income communities. As well, UK tabloids are routinely filled with secondhand shopping horror stories these days, another evidence point as to their increased visibility among British consumers specifically, not to mention the general dangers of buying personal items from strangers you met over the internet. - Lon Harris

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Spencer Rascoff

Spencer Rascoff serves as executive chairman of dot.LA. He is an entrepreneur and company leader who co-founded Zillow, Hotwire, dot.LA, Pacaso and Supernova, and who served as Zillow's CEO for a decade. During Spencer's time as CEO, Zillow won dozens of "best places to work" awards as it grew to over 4,500 employees, $3 billion in revenue, and $10 billion in market capitalization. Prior to Zillow, Spencer co-founded and was VP Corporate Development of Hotwire, which was sold to Expedia for $685 million in 2003. Through his startup studio and venture capital firm, 75 & Sunny, Spencer is an active angel investor in over 100 companies and is incubating several more.

How to Startup: Mission Acquisition

Numbers don’t lie, but often they don’t tell the whole story. If you look at the facts and figures alone, launching a startup seems like a daunting enterprise. It seems like a miracle anyone makes it out the other side.

  • 90% of startups around the world fail.
  • On average, it takes startups 2-3 years to turn a profit. (Venture funded startups take far longer.)
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Spencer Rascoff

Spencer Rascoff serves as executive chairman of dot.LA. He is an entrepreneur and company leader who co-founded Zillow, Hotwire, dot.LA, Pacaso and Supernova, and who served as Zillow's CEO for a decade. During Spencer's time as CEO, Zillow won dozens of "best places to work" awards as it grew to over 4,500 employees, $3 billion in revenue, and $10 billion in market capitalization. Prior to Zillow, Spencer co-founded and was VP Corporate Development of Hotwire, which was sold to Expedia for $685 million in 2003. Through his startup studio and venture capital firm, 75 & Sunny, Spencer is an active angel investor in over 100 companies and is incubating several more.

Bill Gurley in a blue suit
Bill Gurley

This interview was originally published on December of 2020, and was recorded at the inaugural dot.LA Summit held October 27th & 28th.

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