Automobile manufacturer Porsche displays NFT collection of 911 at Art Basel in Miami

Thieves stole over $100 million worth of NFTs in the year to July, blockchain research firm Elliptic said, as the fast-emerging digital asset became a new front in crypto's hacking problem.

Non-fungible tokens (NFTs) are blockchain-based assets that represent digital files such as images, video or text.

The market surged in 2021 as crypto-rich speculators spent billions of dollars on the assets, hoping to profit as prices rose. But since cryptocurrency prices crashed in May and June this year, NFT prices and sales volumes have plunged.

Scams remain rife in the NFT market even as it declines, with July seeing the highest number of NFTs reported stolen on record, London-based Elliptic said in a report. Security compromises via social media have surged, accounting for 23% of NFT thefts in 2022, it said.

Thieves received an average of $300,000 per scam, Elliptic said. The true scale of NFT thefts is likely to be even higher, given that not all crimes are publicly reported.

Elliptic put the amount of money-laundering in NFT-based platforms at just $8 million. But almost $329 million worth of funds in the NFT market came from services such as so-called cryptocurrency mixers, which are designed to hide the funds' origin, Elliptic said.

"There is a growing threat to NFT-based services from sanctioned entities and state-sponsored exploits," Elliptic said, citing a $540 million theft in April that US officials have linked to North Korea's Lazarus Group.