The popularity of NFTs has continued to grow since their inception. Many artists and creatives use non-fungible tokens to share their work with users and sell them at great prices.
Newspaper headlines have attracted NFT’s multimillion-dollar sales in recent months. For example, Beeple’s Opus sold for $ 69 million. People seem to be investing enough in art to buy the digital version. The high value of NFT comes from a collective appreciation for the arts.
Even the classics could not resist. Banksy’s work turns into NFT, and the famous Russian State Hermitage has announced an exhibition of NFT art.
But not everyone in the cryptocurrency space convinced that people spend millions on digital images just because they enjoy investing in art. Despite the fact that anyone can look at these works, regardless of how much the buyer pays for them.
NFT is a way to move illegally obtained money
Renowned cryptanalyst Mr. Whale believes the NFT is simply a way for the rich to move illicit money through a channel that makes it legal.
Cryptanalyst Mr. Whale spoke to Catherine Graffam, Associate Professor of Art and Design; and he agreed that NFT most often used to launder money. A similar situation is typical for real art, where with the help of purchased works; wealthy people launder income obtained in a not entirely legal way.
That being said, Graffam notes that NFTs offer some advantages to criminals over regular physical artwork. In her opinion, it is easier to move dirty money with NFT because it is tied to a decentralized currency and the fact that there are no physical works of art to move or store in offshore tax havens.
However, one factor that works against money launderers wanting to use non-fungible tokens is that most NFTs are on the public Ethereum blockchain; which means transactions tracked. Because NFTs are inherently blockchain-based, their origins and destinations are easier to track, providing a certain level of transparency for all transactions.
Difficulties in evaluating non-fungible tokens
Cryptanalyst Mr. Whale believes that sooner or later, the authorities of the countries will begin to pursue a tougher policy in relation to the NFT sphere. However, objective difficulties may arise here. As with real-life pieces of art, it will be extremely difficult to determine what their true value is?
After all, there are no clear criteria for identifying exactly how much a particular NFT should be worth, where to find independent experts for this assessment, and whether it can be trusted.
In general, there are a lot of technical difficulties with the valuation of non-fungible tokens. And perhaps knowing this, wealthy individuals value NFTs, making them another way to legalize their assets.
In such a case, this practice will continue as long as the NFTs are of value to the market. Given that the interest in them is very significant, someone can very well cash in on this and make their finances impeccable from a legal point of view.