The “cool” issues surrounding minting counterfeit non-fungible tokens, or NFTs, have forced the popular Cent platform to shut down some operations.
Cent was founded in 2017 and started as a “social network and unofficial platform for creative experiences.” In 2020, the team also launched an NFT platform called Valuables to mint popular tweets and auction them off.
Jack Dorsey’s first tweet, “Just setup my twttr,” sold for $2.9 million in March of last year. On February 6, the platform suspended NFT trading due to a “range of activity” that “should not occur.”
Cameron Hegazy, co-founder of Cent, told Cointelegraph:
“People in this field tend to shout ‘buyer beware’ or ‘beware the buyer,’ but protecting creators from anyone who might steal or misuse their work, as well as protecting buyers from potential fraud, is very important.” .
Hegazy told Reuters that the problem was selling unauthorized copies of NFTs and stolen content that had been converted into stock-like NFT and NFT packages.
Amid NFT concerns about money laundering, the first arrest of the NFT in the UK value-added tax fraud case, and even criticism of NASA for space, launching the NFT in 2022 has not been easy.
Humberto Canessa Cerchi, CEO of well-deserved NFT blockchain game Kryptomon, shared that while growing reputation issues are a concern for the industry, it is not enough to exclude potential first-time NFT buyers. He told Cointelegraph that the new buyers are:
“Most of them will end up buying a fake one, and when they find out, they will declare all the NFTs a ‘scam’, which is bad for the industry.”
Shirky shared that “consumer laws” could make things better, and that better education would “prevent the industry from falling victim to fraud.”
Related: YouTube sees ‘amazing potential’ in NFT video sales despite threat of setbacks
Phil Ganway, partner and brand strategist at Blockasset.co, the first sports NFT platform to be studied by athletes, is optimistic about the future of NFT and regulation. He told Cointelegraph:
“The problem with fake listings is directly related to the fact that the marketplaces do not regulate the displayed listings. There are many marketplaces that now allow users to upload and create NFTs on the go, and instead only allow verified listings.”
He added that “developing appropriate rules” may be difficult in the short term, but “there is hope that this will affect the NFT ecosystem.”
As the US Treasury targets money laundering and NFTs, there may be further investigation. Ultimately, Hegazy hopes to “open an industry-wide conversation on this issue” to drive out violators.
