NFT crime and scams skyrocketed in 2021



2021 was without a doubt the year of the heyday of non-fungible tokens (NFT), the technology based on blockchain that allows to certify the ownership of unique and scarce digital assets, which makes it possible to relaunch its value. This innovation, which transfers the exclusivity that already existed in the physical world to the digital arthas led to works, memes and even tweets being sold for astronomical figures.

With their popularization, NFTs have become quite a phenomenon and last year they generated a market of more than 41,000 million dollars. However, this digital gold rush has also opened the door not only to speculation but to a significant increase in crime and fraud, as is also happening with cryptocurrencies. This is indicated by a report published this Wednesday by the Chainalysis platform, which warns of the growth of illicit activities with these assets that could be attributed to the money laundering.

Over the past year, Chainalysis found that between the Stole of money and scams several, the NFTs had illicitly moved a total of approximately more than 3,241 million dollars. That amount was discovered after tracking the value sent between platforms that allow NFT trading and detecting that the recipients were cryptocurrency accounts linked to illegal activities. The volume of illicit money catapulted during the second half of the year.

crime and speculation

"All of this activity represents a drop in water compared to the $8.6 billion of cryptocurrency-based money laundering we tracked in all of 2021," the report's authors write. "Still, the money laundering and sanctioned cryptocurrency business transfers poses a huge risk to building trust in NFTs and should be monitored closely by markets, regulators, and law enforcement." From its inception, the strong privacy of transactions in decentralized systems like Bitcoin has unsettled lawmakers for its potential to be used by criminals without detection.

Many have warned that behind the purchase of NFTs for astronomical figures there is an operation of large funds and investors in the crypto world to grab headlines in the media and revalue their properties. The Chainalysis report also points to a false bubble by pointing to a growth of the 'wash trading', as the practice of NFT owners faking their sale by sending the purchase money to cryptocurrency wallets they control is known in jargon to give the impression that there is a real exchange of that property that enhances its value. The platform detected thousands of cases of this style and up to 262 users who had sold themselves an NFT more than 25 times to obtain profits of up to 8.9 million.



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