US Treasury targets NFTs for potential high-value art money laundering


The U.S. Department of the Treasury released a study on the high-value art market, highlighting the potential in the nonfungible tokens (NFT) space to conduct illicit money laundering or terror financing operations.The treasury’s “Study of the facilitation of money laundering and terror finance through the trade in works of art” suggested that the increasing use of art as an investment or financial asset could make the high-value art trades vulnerable to money laundering:“The emerging online art market may present new risks, depending on the structure and incentives of certain activity in this sector of the market (i.e., the purchase of NFTs, digital units on an underlying blockchain that can represent ownership of a digital work of art).”The study underlines the importance of NFTs in representing ownership of the digital and physical property that is managed and controlled via smart contracts and digital wallets. The treasury also points out that the price of NFTs is determined by the buyer and seller and not the market:“According to U.S. authorities, in the first three months of 2021, the market for NFTs generated a record $1.5 billion in trading and grew 2,627 percent over the previous quarter.”However, the NFT market in 2020 alone was valued at more than $20 billion. The U.S. treasury suggested a possibility where criminals can purchase NFTs with illicit funds and resold to an unwary collector “who would compensate the criminal with clean funds not tied to a prior crime.”NFTs can also be sold via peer-to-peer (P2P) sales, which bypasses the need for an intermediary or recording the transaction over the public ledger. While underscoring the various money laundering vulnerabilities made possible by the NFT ecosystem, the treasury concluded:“Moreover, traditional industry participants, such as art auction houses or galleries, may not have the technical understanding of distributed ledger technology required to practice effective customer identification and verification in this space.”Related: NFTs and DeFi overturn a banker‘s generational curse of poverty in 2 yearsBrenda Gentry, a USAA mortgage underwriter turned crypto entrepreneur, recently shared how the cryptocurrency ecosystem offered her a fighting chance to overcome the generational curses of poverty.Gentry, a.k.a. MsCryptoMom, left her decade-long job as a banker to pursue a full-time crypto career as her initial investments from early 2020 confirmed the “unprecedented opportunities offered by crypto.”My biggest flex this year was walking away from my banking career of 16yrs to go into crypto full time!Retired my parents and now my goal is to retire my siblings and get them working for themselves!NFTs and DeFi are breaking down generational curses of poverty.— Cryptomom (@MsCryptomom1) October 9, 2021

Acknowledging the big learning curve into crypto, Gentry provides educational content through her website:“I’m also hosting seminars to educate the general public about navigating in this space and things to look out for when searching for good NFT projects or DeFi tokens, and also how to quickly detect scams or rug pulls.”

Avatar

Related Articles

- Advertisement -

Latest Articles

bitcoin
Bitcoin (BTC) $ 16,981.88
ethereum
Ethereum (ETH) $ 1,273.70
tether
Tether (USDT) $ 1.00
bnb
BNB (BNB) $ 290.82
usd-coin
USD Coin (USDC) $ 1.00
binance-usd
Binance USD (BUSD) $ 1.00
xrp
XRP (XRP) $ 0.392082
dogecoin
Dogecoin (DOGE) $ 0.099492
cardano
Cardano (ADA) $ 0.324560
matic-network
Polygon (MATIC) $ 0.921647
polkadot
Polkadot (DOT) $ 5.58
staked-ether
Lido Staked Ether (STETH) $ 1,258.59
okb
OKB (OKB) $ 22.08
litecoin
Litecoin (LTC) $ 76.62
shiba-inu
Shiba Inu (SHIB) $ 0.000009
dai
Dai (DAI) $ 1.00
tron
TRON (TRX) $ 0.054075
solana
Solana (SOL) $ 13.58
uniswap
Uniswap (UNI) $ 6.27
avalanche-2
Avalanche (AVAX) $ 13.48
leo-token
LEO Token (LEO) $ 3.98
chainlink
Chainlink (LINK) $ 7.44
wrapped-bitcoin
Wrapped Bitcoin (WBTC) $ 16,959.01
cosmos
Cosmos Hub (ATOM) $ 10.22
ethereum-classic
Ethereum Classic (ETC) $ 19.58
monero
Monero (XMR) $ 145.88
the-open-network
The Open Network (TON) $ 1.78
stellar
Stellar (XLM) $ 0.087517
bitcoin-cash
Bitcoin Cash (BCH) $ 110.74
quant-network
Quant (QNT) $ 130.34
algorand
Algorand (ALGO) $ 0.241030
crypto-com-chain
Cronos (CRO) $ 0.064589
filecoin
Filecoin (FIL) $ 4.57
apecoin
ApeCoin (APE) $ 4.02
near
NEAR Protocol (NEAR) $ 1.71
vechain
VeChain (VET) $ 0.019439
hedera-hashgraph
Hedera (HBAR) $ 0.048414
internet-computer
Internet Computer (ICP) $ 4.23
flow
Flow (FLOW) $ 1.10
terra-luna
Terra Luna Classic (LUNC) $ 0.000179
elrond-erd-2
MultiversX (Elrond) (EGLD) $ 43.32
frax
Frax (FRAX) $ 1.00
eos
EOS (EOS) $ 0.935913
trust-wallet-token
Trust Wallet (TWT) $ 2.31
tezos
Tezos (XTZ) $ 1.02
the-sandbox
The Sandbox (SAND) $ 0.595172
aave
Aave (AAVE) $ 64.18
theta-token
Theta Network (THETA) $ 0.907495
chiliz
Chiliz (CHZ) $ 0.167151
huobi-token
Huobi (HT) $ 6.79