/ Dangerous NFT market

Sunday, April 10, 2022
09:25 am CET
By Ronny Waburek

Like the Wild West

Dangerous NFT market

Sunday, April 10, 2022, 09:25 am CET
By Ronny Waburek

Dangerous NFT market

Dangerous NFT market

The fact that the lack of transparency in the art market is a problem has been known for a long time. However, the current NFT boom has exacerbated the problems. This becomes clear in an interview that the lawyer Pascal Decker has now given to the German Manager Magazin. Decker sees one of the main problems in the fact that the large NFT trading platforms are currently hardly regulated, unlike stock trading, so that fictitious transactions are also easier. He sees the NFT art market as a "Wild West."

Often, he reports, the money laundering business goes like this: The money launderer buys a cheap NFT artwork with clean money, then offers it for sale on a platform. And now the money launderer buys the NFT artwork there with the black money to be laundered, either himself or through an intermediary. Digital currencies also allow the identity and origin of the money to be concealed.

Therefore, one should not be surprised that the prices for NFTs are going up. Politicians have not yet found an instrument to prevent this. Above all, this requires cooperation between many countries. Directives have already been adopted at the European level. But this is not enough. In the end, such an approach protects the art market, which now has the reputation of becoming a money-laundering machine. This also puts pressure on classic auction houses, art dealers and gallerists to pay more attention than in the past to whom they sell art, especially NFT art. And renowned artists like Jeff Koons have to watch their reputation when their ambition drives them to create artworks like the Moon Project. 

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Ronny Waburek
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