NFT marketplaces and traders are coming under growing scrutiny.
National financial regulators are starting to modify the official classification of securities and financial instruments to include some types of NFTs. This has already been seen in Germany, the Philippines, Malaysia, and Thailand, with the US Treasury and SEC closely debating its definitions. The changing definitions will bring enhanced regulations and responsibilities for the industry.
This attention comes as threat actors are turning to NFTs as fundraising tools. As the abuse of NFT marketplaces grows, legislators are taking notice. To secure NFT marketplaces, Trust & Safety teams must understand who is abusing their platforms. This will prevent abuse and, therefore, avoid demands for burdensome regulatory oversight and the damaging effects of abuse.
In this report, ActiveFence provides examples of threat actors raising significant funds through the sale of NFTs on mainstream marketplaces. By uncovering such abuse, Trust & Safety teams will understand the real-life threats that can take place on their platform and learn what is needed to take action against these perpetrators.