Uncover 4 hidden metaverse Ad fraud threats and protect your campaigns

Metaverse Ad fraud: As advertisers invest billions into virtual worlds, ad fraud threatens to drain resources and distort ROI. Statista projects metaverse advertising to grow at a 27.32% CAGR from 2025 to 2030, reaching $7.5 billion.

Yet, digital ad fraud costs businesses $88 billion in 2023 and is expected to soar to $172 billion by 2028. One example is the Apollo scheme, which Forbes reports generates 400 million fake bid requests daily in 2025.

This guide unpacks common fraud schemes, their impact, and actionable strategies to safeguard your campaigns.

What is the metaverse, and why is advertising thriving there?

Metaverse advertising goes beyond static banners, offering immersive experiences such as branded events and virtual product demonstrations. For example, a fashion brand can host a digital runway where users try on outfits through AR filters.

According to Statista, users already spend an average of 90 minutes daily in these virtual spaces more than on social media. Ad spending is projected to hit $7.46 billion by 2030, while Forbes reports programmatic audio ads in these environments could reach $2 billion by 2025.

However, the decentralized, blockchain-based framework of the metaverse lacks the centralized oversight of Web2.

Ad fraud explained: From traditional digital Ads to the metaverse

Ad fraud refers to fake activity that artificially inflates ad results. It creates false clicks, views, or sales that don’t come from real people. Common tricks include:

• Bot traffic: Robots copy human actions to make fake views.
• Impression fraud: Ads load but are never seen, such as hidden stacked ads.
• Click farms: Individuals are paid to click and engage in unnatural ways.
• Domain spoofing: Fake sites masquerade as reputable publishers to secure ad revenue.

In the metaverse, these tricks get smarter. Bots can join events and move like humans. The blockchain-based metaverse also introduces new forms of fraud. Wash trading pushes NFT prices higher than their real value. Phishing targets virtual wallets.

Top 4 metaverse Ad fraud tactics and techniques

The realistic experience of the metaverse enhances the sophistication of ad fraud, as online promotion of 3D ads creates loopholes in verification.

The four (4) metaverse Ad fraud tactics and techniques include:

• Avatar impersonation and bot swarms:

Avatars play a crucial role in interaction within the metaverse. But AI botnets copy this behavior. They dance at concerts, buy digital products, and mimic real users. At one event in 2024, 10,000 fake avatars generated 500,000 fake impressions.

Forbes reports that tools like CycloneBot, which inflate CTV views, are now being utilized in the metaverse in conjunction with deepfakes. Statista shows desktop ad fraud at 13.2%. In VR, user agents are harder to track, which may double the risk of exposure.

• Virtual real estate scams and NFT wash trading:

Virtual land in apps like The Sandbox is highly profitable. Fraudsters inflate parcel values and resell them using bot traffic. Statista projects metaverse e-commerce to reach $201 billion by 2030. But fake ad placements threaten these budgets.

In 2025, Forbes exposed a scheme that generated $400 million per day from fraudulent requests.

• Immersive impression fraud:

Metaverse ads that use server-side ad insertion (SSAI) send fewer tracking signals.

Statista reported $1.28 billion lost on mobile app ads in Q2 2024. Even Roblox metaverse extensions, such as AR filters, now face these threats.

• Cross-platform exploitation:

Web3 platforms are connected, allowing fraud to spread across systems and reducing ROI.

Forbes predicted in 2022 that avatar deepfakes would fuel identity fraud. According to Statista, in 2024, 75% of Japanese users associated the metaverse with crime.

These scams drain ad revenue and weaken trust. In Q2 2022, 17% of global ad impressions were found to be fraudulent.

The alarming impact of Ad fraud on metaverse advertisers

The cost of ad fraud is big. In the metaverse, the losses are worse because ad spend is still new but very costly. Statista predicts that by 2028, North America will account for 42% of the $173 billion in fraud losses, while the Far East will bear 20%.

Forbes reports that P2P fraud reached $1.7 billion in 2022, a 90% increase from the previous year. Metaverse crypto deals also show this same risk. Other than finance, there are other effects such as:

• ROI dilution:

Marketers evaluate success through metrics of engagement, yet non-human bots generate 18% of internet traffic.

Fake interactions in immersive spaces can distort analytics, leading to misguided strategies.

• Brand reputation damage:

Images are ruined by exposure on fake sites. A Gucci virtual handbag event, which bots have infiltrated, could create memes of ghost buyers.

• Ecosystem strain:

Fraud also deprives publishers of revenue because it undermines inventory.

Statista observes that ad fraud protection services are increasing at double-digit rates, yet metaverse publishers are not widely adopted.

• Regulatory ripples:

As of September 2023, the FTC had received 48,835 reports of payment app fraud. Metaverse analogies likely lead to Web3 regulation, which could hinder growth.

In 2022, Reality Labs by Meta reported a loss of $13.7 billion, which included unmonetized experiments that were vulnerable to fraud.

One way this may harm brands is by reducing ROI on metaverses by 50%.

How to detect and prevent metaverse Ad fraud

Preventing metaverse ad fraud requires a multi-layered solution that combines technology, collaboration, and effective monitoring.

• Use blockchain to achieve transparency

The immutability of blockchain has the potential to time-stamp interactions, confirming human interaction.

The MetaX adChain protocol utilizes distributed ledgers to monitor supply chains, thereby preventing spoofing.

The NFT-based ad proofs in the metaverse guarantee that impressions are authentic.

• AI-powered detection tools

Ironically, generative AI, which can be used to facilitate fraud, also helps to counter it.

The Forbes 2025 Council praises AI, saying it prevents billions of violating ads from being displayed before they are shown.

Detection tools such as ClickPatrol detect ad fraud. In the case of the metaverse, incorporate avatar behavior analytics to identify unnatural behavior.

• Joint standards and certifications

Participate in programs such as those of the Trustworthy Accountability Group (TAG), which Forbes attributes to reducing detectable fraud by 80-90%.

Standards used in the metaverse, including web3 guidelines by IAB, require verification across multiple devices.

• More sophisticated checks and detection

Measures demand viewability metrics that go beyond impressions, measure dwell time, and depth of interaction.

Statista’s future projections focus on AR/VR analytics and utilize heatmaps in the virtual space.

• User education and policy advocacy

Train teams to recognize red flags, such as unusual bursts of traffic or unrelated geolocations. Promote international standards, and Forbes proposes a metacode of conduct on platforms.

These measures have the potential to recover 70% of wasted spend.

Case studies: How brands are tackling metaverse Ad fraud

Here are three (3) real cases that reveal metaverse Ad fraud.

• Nike’s Nikeland in Roblox

Launched in 2021, it generated millions of interactions but was inundated with bot swarms that inflated visit numbers.

Nike added CAPTCHA-style avatar checks, cutting fraud by 40%.

• Gucci’s Metaverse Garden

In 2022, Decentraland’s event was marred by wash trading of virtual items. Gucci used blockchain audits and recovered $500,000 in lost Ad spend.

• Apollo Audio Spillover

A 2025 Forbes exposé linked CTV fraud to metaverse audio events, where proxies faked VR streams.

Advertisers shifted to SSAI, which improved tracking and resulted in a 60% reduction in losses.

These cases demonstrate that fraud is a genuine concern, but proactive defenses can mitigate the damage.

Why marketers can’t ignore metaverse fraud in 2025

Metaverse ad fraud is no longer a side issue; it is a growing threat that marketers cannot afford to ignore.

Fake avatars, bot swarms, NFT scams, and spoofed VR streams are already draining budgets and distorting ROI.

In 2025, the Apollo scheme alone generated hundreds of millions of fake requests daily, showing how fast fraud tactics evolve.

The risks are clear: wasted spend, unreliable data, and loss of trust. To stay ahead, marketers need fraud detection tools, trusted partners, and blockchain safeguards.

Acting now will protect campaigns, secure investments, and build stronger credibility in the metaverse.

Abisola

Meet Abisola! As the content manager at ClickPatrol, she’s the go-to expert on all things fake traffic. From bot clicks to ad fraud, Abisola knows how to spot, stop, and educate others about the sneaky tactics that inflate numbers but don’t bring real results.

View all posts by Abisola (Abisola)

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