US Treasury qualifies NFTs as assets “susceptible to scams and fraud” – DiarioBitcoin

The agency warns about the use of these assets in crimes of a financial nature, such as money laundering and financing of terrorist acts, and therefore invites platforms and users to use mechanisms to mitigate risks.

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• US Treasury presents a financial risk report on the NFTs
• It qualifies them as assets susceptible to being used for financial illicit activities.
• Bad actors see the use of these assets in money laundering and financing terrorist acts.
• They invite people and platforms to finalize measures to mitigate risks

The US Treasury Department rated the tokens non-fungible (NFT) as “highly susceptible to being used in fraud and scams”warning all people interested in participating in financial activities with this type of assets.

Treasury Department warns about NFTs

The Treasury Department’s comments came into play in its most recent “Illicit finance risk assessment” related to the NFT, where he explored in detail vulnerabilities associated with these assets and the platforms where they are usually traded, highlighting crimes such as money laundering, financing of terrorist acts and other acts of an illicit nature.

The report alleges that non-fungible tokens “They are very susceptible to being used in fraud and scams and are subject to theft“, given that criminals can use NFT “to launder the proceeds of predicate crimesoften in combination with other methods to obfuscate the illicit source of the proceeds of crime.”

Regarding the risks inherent to these assets, the statement reads:

The assessment finds that inadequate cybersecurity protections, challenges related to copyright and trademark protection, and the hype and fluctuating prices of NFTs may allow criminals to perpetrate fraud and theft related to these assets and their platforms. associated businesses.

Therefore, it urges companies and platforms to establish adequate controls to mitigate the risks that threaten the market, as well as implement KYC practices to avoid acts of an illicit nature. They ensure that implementing mitigation measures and working with tools characteristic of both the industry Blockchain as well as the traditional sector, partially reduce the incidence of bad actors within this industry, while supporting the authorities in the work of pursuing criminals.

Scams and crimes in the NFT sector

Although the study places more emphasis on the practices of bad actors, the NFT sector has not been free of controversy precisely due to the proliferation of crimes and scams that mainly affect merchants.

The most common of all is the supposed marketing of collectible items from reputed collections, which in reality are fake copies that are sold at prices below the NFTs originals as an attractive offer. There are also typical operations in which the counterparty does not deliver the agreed product, among others.

Generally, the marketing of NFTs It is done through specialized platforms with controls to avoid this type of events, where payments are made with cryptocurrencies. Outside of these markets, those who tend to expose themselves to a greater variety of scams, so the invitation is to be very attentive and avoid exposing themselves unnecessarily.

Article by Angel Di Matteo / DailyBitcoin

Picture of Unsplash

WARNING: This is an informative article. DiarioBitcoin is a media outlet, it does not promote, endorse or recommend any particular investment. It is worth noting that investments in cryptoassets are not regulated in some countries. They may not be suitable for retail investors as the entire amount invested could be lost. Check the laws of your country before investing.