US Treasury Department warns of the possibility that NFTs could become a money laundering tool.
The 40-page report, published in compliance with the 2020 Anti-Money Laundering Law, said that high-value artworks are involved in money laundering but not used in terrorist financing. However, the report suggests that NFTs can facilitate illegal transactions.
“The emerging digital art market, its use such as NFTs, may introduce new risks depending on the structure and market incentives”
The report mentioned that NFTs are vulnerable to money laundering due to their portability and the fact that their prices can be easily manipulated.
The NFT market traded $1.5 billion in the first quarter of 2021, compared to the $20 billion the US art market saw. Still, the report states that legitimate auction houses are bidding more and more NFTs. It was also highlighted that platforms such as Dapper Labs, OpenSea and SuperRare are growing.
14534
