The U.S Treasury recently published a 35-page report on the risks of money laundring in the non-fungible tokens (NFT) market.
The report outlines how bad actors could use NFTs to disguise proceeds of a criminal enterprise by buying and selling digital art in the burgeoning $20 billion NFT market.
“The ability to transfer some NFTs via the internet without concern for geographic distance and across borders nearly instantaneously makes digital art susceptible to exploitation by those seeking to launder illicit proceeds of crime, because the movement of value can be accomplished without incurring potential financial, regulatory, or investigative costs of physical shipment,” said the Treasury.
The report cites potential uses cases criminals may be interested in, but reputable blockchain analysis firms say that illicit funds being moved through the NFT market is releatively low at present. Firms like Chainalysis say that less than $1.5 million has been laundered through NFTs in the last quarter of last year, a tiny figured compared to the billions of dark money moving through the crypto markets.
Image credit 1
