Posted by Breaking The Law
Monday byNoor Al-Sibai
Prominent NFT Marketplace Shuts Down Almost All Sales for Fraud
The CEO straight up admitted it.
/ Future Society/ Crypto/ Nfts/ Web 3
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A marketplace best known for selling a non-fungible token (NFT) of former Twitter CEO Jack Dorsey’s first tweet has had to “pause” nearly all sales because they were being used to break the law.
As first reported by Reuters, the NFT marketplace Cent has had to shut down almost all sales because, as CEO Cameron Hejazi admitted, “there’s a spectrum of activity that is happening that basically shouldn’t be happening — like, legally.”
In a “community update,” Hejazi explained that it had come to his attention that “bad actors” had been using Cent to “mint” counterfeit NFTs, which generally involved selling copies of NFTs that didn’t belong to them or creating NFTs of content they didn’t own.
In other words, the marketplace encountered the exact problem NFTs were designed to solve in the first place: assigning rights to digital assets that people actually own.
Cent cited a lack of an “industry wide standard for counteracting bad behavior” for its reasoning behind shutting down almost all NFT sales until the marketplace figures out “a strategy to overcome the challenges we’re facing.”
But there’s one notable exception to the shutdown: Cent is still allowing the sale of “Valuables,” or NFTs of tweets “autographed” by their original posters, like Dorsey’s tweet, which on its own sold for the crypto equivalent of $2.9 million in March 2021.
To Hezaji, it’s symptomatic of a much wider issue. The CEO told Reuters that counterfeiting is “a pretty fundamental problem with Web3.”
Web3 is the overarching concept of a new iteration of the internet that relies on blockchain tech like NFTs.
In many ways, the concept of “theft” of an NFT, which confers no physical value to its owners, seems at best a foregone conclusion. On the other hand, the trend could be seen as justified retribution by scammers for taking part in what’s likely a drastically overvalued market.
Regardless of what one thinks of NFTs, the fact remains that there is a staggering amount of fraud occurring in the space, which should raise plenty of red flags.
If there was ever a time to make a concerted effort to root out the fraudulent elements plaguing NFTs and the Web3 movement, it’s now.
READ MORE: Marketplace suspends most NFT sales, citing ‘rampant’ fakes and plagiarism [Reuters]
More NFT scams: Because the World Has Lost its Mind, You Can Now Buy NFTs of Strings of Emojis
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