Are NFTs conducive to money laundering?
Audio 04:10
"Everydays: The First 5,000 Days" (detail), digital work by American artist Mike Winkelmann alias Beeple, sold on March 11, 2021 at Christie's for $69.3 million.
© Handout / CHRISTIE'S AUCTION HOUSE / AFP
By: Dominique Baillard Follow
4 mins
The UK Inland Revenue announced yesterday the seizure of three digital artworks sold as NFTs.
Is this new blockchain
technology
a new vector for fraud and money laundering
?
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This is what the US Treasury fears.
In a note published last week, he warns against the risks of money laundering induced by the new NFT market, or non-fungible or non-interchangeable, that is to say unique, token.
The NFT is a coded certificate of ownership that guarantees the authenticity of a digital object, it can be a work of art but also collectible images of footballers or video game accessories.
The NFT is considered tamper-proof and traceable.
This booming market could facilitate the financing of terrorism and more generally money laundering, according to American experts.
How is NFT conducive to money laundering?
The sale of an NFT takes place on the internet, in one click, free of charge, and without third parties, it is to the advantage of the author, but it also means that there is no control.
And no logistics either, since unlike a table that must be transported and kept, an NFT by nature virtual can change ownership from one country to another in a few seconds.
The ease of exchange is conducive to manipulation.
Especially since the sellers and buyers remain anonymous, since they carry out the transaction via a cryptocurrency account where their identity is not necessarily mentioned.
These loopholes in the NFT market are already being exploited by connoisseurs
Not necessarily to launder money but to increase the rating of an NFT.
The same work can be exchanged several times on a platform between two accounts, and these accounts can also be held by the same and unique person.
A practice totally prohibited in conventional financial markets.
The first hundred sales in value for the month of January were made by around fifteen accounts, so there is market inflation very well controlled by a handful of speculators.
There are also anecdotal and strange transactions like the one reported by our colleagues from the
New York Times:
Melania Trump put one of her portraits up for sale in NFT for charity and it was bought
through
her own account, as if the former first lady sought to retain ownership.
Do we already have an idea of the amount of the fraud?
According to the company Chainalysis, which specializes in tracking cryptocurrency data, this remains minor.
In a market estimated to be worth more than $44 billion in 2021, fraud peaked at $1.4 million in the last quarter of the year.
Market manipulation is the most common form of fraud, but it is not money laundering.
On the other hand, in the wider world of cryptocurrencies, the phenomenon exploded last year.
Plus 30% by volume.
This is evidenced by another news item that has made the headlines of financial crime.
A couple of young New Yorkers have been arrested trying to convert Bitcoin stolen five years ago into currency.
He could thus have pocketed a booty of 4 billion 500 million dollars.
We are already talking about the Bonnie and Clyde of cryptocurrencies.
► IN BRIEF
In Japan, the economy returned to growth in the last quarter of 2021.
With growth at 1.7% on an annual basis, Japan is still far from having erased the losses of 2020 caused by the pandemic.
The current wave of omicron complicates the recovery, but forecasters remain confident that it should be confirmed this year with the implementation of a gigantic recovery plan.
In New Caledonia SLN, the subsidiary of Eramet, is going to invest 250 million euros to boost nickel production.
The Doniambo plant should be one of the first beneficiaries, with the key to creating 200 jobs;
SLN has been in deficit for ten years, it has been three years since it implemented a rescue plan to return to profit.
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