The crypto industry’s pseudonymous structure can make it impossible to know where projects come from properly—and to trust who’s behind them—as the market for NFT digital artifacts grows. For example, many NFT collectors learned the hard way this week when the developers of a well-known women-centric project acknowledged lying about their gender.

According to its Twitter page, Fame Lady Squad (FLS) is an Ethereum-based NFT collection that began in July and claims to be the “first female avatar project of all time.”

The Fame Lady Squad NFTs, allegedly made by a trio of women named Cindy, Kelda, and Andrea, were swiftly minted and picked up by collectors. A passionate fan base grew up around the project, and secondary market prices began to rise.

Even investor and social media influencer Gary Vaynerchuk—an NFT inventor and new owner of a $3.7 million CryptoPunk NFT—spoke out in support of Fame Lady Squad on Twitter. In addition, the idea was featured in a recent article in The New Yorker. So fame Lady Squad appeared to be prepared to continue gaining popularity, despite a recent increase in NFT market trade activity.

However, in recent days, doubts about the Fame Lady Squad project’s origins have grown louder. Twitter sleuths like @FedorLinnik, @dearesthaley, and @NFT Marty provided extensive Twitter threads connecting the dots between several recent NFT collectibles projects, like Cyber City Girls Club and Unicorn GG Club, that appeared to come from the same source or share creators.

Pranksy, a well-known NFT collector, said on Tuesday that after purchasing a Cyber City NFT, they “failed to perform my own research adequately” and that it was “created by a dev team that seems to be churning out a new project daily.”

“The questions here are what actually makes a [profile picture] project valuable?” Pranksy asked, adding that the crew had been “so brash” about promoting its next project, Unicorn GG Club. Are the development team, the community, and the time it took to create it worth it?”

While they are valid considerations for NFT collectors to consider, the Twitter allegations progressively pointed to project creators providing incorrect information. For example, FedorLinnik, a developer behind several crypto ventures, claimed the evidence led to a gang of Russian guys who were “mining new NFT projects like a conveyor” this spring. Instead, they seemed to be behind Fame Lady Squad as well as the other new enterprises.

Coming Clean

Although the developers of Fame Lady Squad first resisted, citing “false accusations” and claiming rivalry from competitor NFT designers, they later dropped the ruse under mounting criticism from the collector community.

Max Rand, a developer, tweeted on Tuesday that he was one of the persons behind the Fame Lady Squad and other initiatives, along with a couple of collaborators: D Mefi, who had his Twitter account briefly removed, and another unknown associate. Rand tweeted, “Sorry for the lie.  I was hesitant to say this because of [a] lot of threats on my side, my stupidity, and my lack of grasp of US market culture rules,” says the author.

The official Twitter account of the Fame Lady Squad went even further with its explanation. “Let’s be clear: Fame Lady Squad was built by a male crew, and we apologize for not disclosing this earlier. But that doesn’t mean it’s a ruse or a fraud,” the team wrote on Twitter. “We saw that there are very few female-led projects in the space. And, because we are fascinated by women’s strength, we were able to complete this successful project.”

Meanwhile, in a tweet thread, the Cyber City Girls Club NFT project—which was previously credited to a pair of Asian-American women developers—explained its own fraud.

The tweet thread began, “Sorry to everyone who had invested into our idea because it was made only by two Asian women. CCGC was founded by a group of six people, only two of whom were female. But, we’ll extend the plan and provide holders greater value. Good night!” says the narrator.

Even though the Unicorn GG Club NFT project didn’t have the same kind of significant false representation issue at its heart, the development team—including Rand and D Mefi—decided to halt sales of NFTs in the wake of the larger scandal. “I’m not trying to get away; I’m simply clearing my mind,” co-creator “Trible Penguin” tweeted from the official account. “We don’t do [expletive] rug pulls Memecoin, but I’m terrified of the bullying. So I apologize for the delay.”

The Queenship NFT project, which displays images of Black women and was reportedly made by Black women, has yet to be authenticated by the same developers. The Legendary Lady Squad Rand denied his role after Twitter rejected the connection earlier this week. The Queenship website is no longer accessible, and the project’s most recent tweets from Monday raged against rumors about its origins.

Following a recent giveaway promotion, the team behind NFT Project Bulls On the Block—which some Twitter sleuths suspected was also affiliated with the same developers—denied any relationship with the FLS founders.

A Change of Plans

To put it mildly, it’s a disaster. Collectors who bought NFTs from the Fame Lady Squad, in particular, believe they were tricked into thinking they were investing in a project made by and for an under-represented group in the crypto industry. As a result, collectors sought to panic-sell their FLS NFTs on the secondary market OpenSea yesterday, fearing waning demand amidst what appears to be an impossible road forward for the project.

The creators of Fame Lady Squad, on their part, are attempting to make amends in the form of money. Rand said that he and his partners will create a $100,000 grant fund to assist new NFT projects and artists and that it will start “soon” in “a few days,” according to Decrypt. Unicorn GG also stated that it had donated 5 ETH (about $15,700) to the Virunga National Park in the Democratic Republic of the Congo, using an Etherscan link as proof.

Disturbed by yesterday’s disclosures and the circulating charges in the days before, several prominent members of the Fame Lady Squad community began advocating for a different kind of settlement to give the project a future. In response to Rand’s confession tweet on Tuesday, noted NFT collector Artchick outlined a possible path forward.

“This is over for you,” Artchick told Rand. “If you want to do the right thing, I can broker a deal where you hand over control of your smart contract, and holders of FLS NFTs have a chance to recoup their losses and potentially thrive. After that, put the contract in the hands of the community.”

That is precisely what occurred. After submitting the matter to a Twitter vote, the Fame Lady Squad developers gave her control of the NFT project’s smart contract. Artchick then passed the contract on to “Bored Becky,” a notable FLS community member who will oversee the project with the help of other FLS members.

The developers will no longer profit from secondary sales, according to Artchick’s tweets.

When asked why his team relinquished ownership of Fame Lady Squad, Rand stated, “Because the community wanted it,” smiling. D Mefi, a co-creator, responded to a tweet defending his team’s conduct today, saying, “We didn’t screw anyone. Instead, we built a project that helped many people while also introducing many new people to the place. I understand your dissatisfaction; we apologized for our error and made good decisions to allow FLS to grow once more.”

Collectors applauded the action, and community members immediately began discussing the new road forward after secondary market prices for the NFTs soared back above levels observed before the team’s confession. However, no equivalent intentions for transferring control of the connected NFT initiatives have been revealed.

After such upsetting revelations, the Fame Lady Squad community appears to have found a happy resolution. However, it’s uncertain whether the recently established Cyber City Girls Club project can recover following this week’s news: NFTs are trading for about 0.01 ETH (about $32) on OpenSea, compared to a floor of 0.13 (roughly $420) for FLS collectibles.

Pranksy’s aforementioned tweet explored what made NFT avatar collections valuable, and as this case indicates, the claimed genesis narrative and the perceived value of artwork can be linked. Of course, it’s a subjective thing, but when that worth is built on fabrications—which isn’t helped by the anonymity of crypto—investors might be tricked and end up with NFTs that have lost a lot of their predicted value.

Not every story like this will have a happy ending.