Cent, a non-fungible token (NFT) selling platform, has suspended the majority of its trading because people have been selling content that is not theirs, Reuters reported on Saturday (February 12th).
Buying and selling on Cent Market was halted on February 6 and Cameron Hejazi, the platform’s founder, said the fraud was a “fundamental” problem in the world of digital assets.
Last year, NFT sales soared to around $25 million, according to Reuters, leaving people ‘baffled’ over why the money is being spent on items that don’t really exist and may be viewed for free. Last March, Cent sold an NFT of a Jack Dorsey’s early tweets for nearly $3 million.
Hejazi was quoted by Reuters as saying that there’s “an array of activity happening that basically shouldn’t be happening – like, legally.”
He said there are three main issues: people selling unauthorized copies of other people’s NFTs, people creating NFTs with content that doesn’t belong to them, and people selling sets of NFTs that look like a title.
All of these things had been “rampant”, and he added that some users were “hit and hit and hit counterfeit digital assets”.
These problems could be more targeted with more brands joining the virtual metaverse, or Web 3. Even OpenSea, the largest NFT platform, said the problem is real and that more than 80% of NFTs minted for free on its platform -form have been “plagiarized”. works, fake collections and spam.
PYMNTS wrote that the US Treasury has identified the NFT market as a market ripe for use in financial crimes, with a recent report indicating that there are several reasons why it is attractive, including high dollar values and ease of transportation.
See also: The US Treasury sees NFTs as the main target of money launderers
Some participants have started implementing due diligence procedures for buyers and sellers of NFTs, which can help combat money laundering – although its voluntary nature may render it moot.
The Treasury also suggested other solutions, such as government support for private sector information-sharing programs to encourage transparency.