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The NFT Platform famous for minting Jack Dorseyâs first tweet has halted NFT operations amid counterfeiting and illicit activity calls.
âRampantâ issues relating to minting counterfeit nonfungible tokens, or NFTs, have forced popular platform Cent to halt some operations.
Founded in 2017, Cent kicked off as a âsocial network and informal platform for creative experimentation.â In 2020, the team also launched an NFT platform called Valuables to mint and auction iconic tweets.
Jack Dorseyâs first tweet, âjust setting up my twttr,â sold for $2.9 million on the platform in March last year. On Feb. 6, the platform ceased NFT trading due to âa spectrum of activityâ that "shouldnât be happening."
Cameron Hejazi, co-founder of Cent told Cointelegraph:
âPeople in this space tend to cry "caveat emptor" or "buyer beware" but protecting creators from those who might steal or abuse their work â and protecting buyers from potential fraudâ is very important.â
Hejazi told Reuters that the issue was the sale of unauthorized NFT copies, stolen content converted into NFTs and NFT sets that resemble securities.
Amid NFT money-laundering concerns, the first NFT seizure in a UK VAT fraud case and even NASA wading in with its criticisms of the space, NFTs have had a rough start in 2022.
Umberto Canessa Cerchi, CEO of Kryptomon, an NFT play-to-earn blockchain game, shared that while growing reputational concerns are a concern for the industry, it is not enough to put off potential first time NFT buyers. He told Cointelegraph that among first-time buyers:
âMost of them will end up buying a fake, and then when they find out about it, they will declare all NFTs "scams," and that's bad for the industry.â
Cerchi shared that âconsumer protection lawsâ may improve the situation and better education would âprevent the industry from becoming a victim of fraud.â
Related:Â YouTube sees âincredible potentialâ in NFT video sales despite backlash threat
Phil Gunwhy, partner and brand strategist at Blockasset.co, the first athlete-verified NFT sports platform, is optimistic about the future for NFTs and regulation. He told Cointelegraph:
"The problem with fake listings is correlated directly to how marketplaces do not regulate the listings that appear. There are many marketplaces that do now allow users to upload and create NFTs on the fly and instead only allow verified listings.â
He added that âdeveloping relevant regulationsâ could be challenging in the short term, but there is âan expectation that this will trickle down to the NFT ecosystem.âÂ
As the U.S. Treasury takes aim at money laundering and NFTs, there could be further scrutiny to come. Ultimately, Hejazi hopes to âopen an industrywide conversation around this issueâ to root out offenders.Â
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