I have been unable to wrap my head around the reason people pay a fortune for NFTs if not to launder money.
Non-fungible token NFT is a unique digital asset that is authenticated using a blockchain to make it immutable. Digital assets can be picture, a digitised epic comment, artwork, music, sports cards or videos, or even tweets. Take it as NFTs = digital art and collectibles.
Someone else can have that picture, screenshot the tweet but won't be able to make money with it, whereas the original owner turned NFT owner can sell as NFT to the highest bidder. The buyer can also resell in the future with the original creator taking a cut from future sales.
Cryptocurrency world is fast evolving and there will be no turning back in the coming years. The defi craze saw some adoption but not worldwide adoption as wanted. This is what NFTs is trying to achieve now.
Unfortunately, the space of non-fungible tokens is tainted with dubious users using it to launder money.
Thousands of collectors are utilizing the decentralisation and anonymousness aspect of NFTs to convert their illegal money to legitimate own.
It is now common to see a collector buy an NFT for $150,000 only to sell for pennies in few days. This is money laundering and it doesn't look like stopping anytime soon.
The biggest recorded NFT sale till date, was digital artist Mike Winkelmann’s (Beeple) Everydays: The First 5000 Days, sale which sold for a stunning $69 million. Winkelmann who uses the name Beeple, broke his own record with the sale, having set one in February 2021 after selling a crypto art piece for $6.6 million.
Jack Dorsey sold his first ever tweet for over $2m
The money involved in NFT is much that industry experts believe many dubious users are utilizing the opportunity to launder money.
Let's look at how this work.
Taxes and Death are two things that are inevitable and we are bound to pay. While we are still paying the latter, criminally minded individuals have gotten a way round the former.
The price of NFTs is determined by the buyer. It's a kind of auction where you pick the highest bidder after smaller bids are automatically knocked off by the blockchain. You can think Mr Bumblebee Corel draw made digital art is worth less than $1 but a Mr Jones far away will pay millions for it. Like they say, Art is subjective so you can't question Mr Jones. The truth is Mr Jones and Mr Bumblebee are the same are the same user.
In the practical sense let's look at it
I have millions of illegal money that I can't spend else the IRS will come for my head. What do I do?
It's as easy as exchanging crypto on pancakeswap or cubdefi. I simply create an account on one of the NFT platform.
Upload my digital art as NFT and put it for sale
I create another account. Bid $1,000,000 on the NFT.
I get back into the creators account and accept the offer.
That's it, I have turned my illegal money to legal money. Now, if the IRS asks where I got all that money from or someone asks why are you so rich all of a sudden. My reply can be seen below
What the hell are you talking about?
I made that money selling precious unique digital art (NFTs). It’s clean and clear as potable water. Come let me show you how it's done.
Pretty cool isn't it? You can do the same for your tweets and your illegal money turns to legitimate money.
NFTs will get the same kind of bitcoin regulation soon if these bad actors don't desist.
What do you think about this piece? Don't forget my epic response to Justin Sun tweet is still up for sale on V.CENT.CO