The NFT industry has already seen its fair share of controversy. From Opensea claiming that 80% of NFTs are scams to massive NFT swindles, there seems to be end to the platform's issues. In a new development, a popular NFT marketplace has been forced to pause sales due to fraudulent activity.
NFT marketplace Cent faces fraud
Reported by Reuters, Cent, a popular NFT marketplace, paused sales of almost all NFT assets due to illegal activity. The platform discovered that most sales on the service consisted of plagiarised assets that didn't belong to them.
In a Cent Community Update, CEO and co-founder Cameron Hejazi explained that the platform is full of illegal activity. Hejazi told the community that “there’s a spectrum of activity that is happening that basically shouldn’t be happening — like, legally.”
The CEO claims that users have been minting NFTs of assets that they do not own. This includes posing as original artists and minting their work without consent. Additionally, the NFT marketplace saw a mass of NFT Replicas of popular assets being sold as new items.
“Recently, on our network, we’ve seen people taking others’ work and re-minting it using our services,” Hejazi wrote. “We believe these people are bad actors, who only engage with Cent for the purpose of tricking others into purchasing counterfeit work. We do not condone this behavior – ethically, legally, and philosophically, it goes against our values and what we stand for as a company.”
Read More: The NFT industry is full of wash trading
The unregulated platform is full of issues
The entirety of the Web 3 push in recent years has been full of issues. As a new technology, the lack of regulation has caused a horde of theft, plagiarism, scams and hacks to flood crypto services. In extreme cases, these issues can result in the loss of millions of dollars.
Hejazi explains that this unregulated nature is a ““a pretty fundamental problem with Web3.” Since there’s no “industry wide standard for counteracting bad behavior”, bad actors can seemingly get away with anything.
The Cent CEO explains that he's currently working on “a strategy” to moderate Web 3. However, that lack of regulation is the entire point of Web 3, cryptocurrency and the blockchain. With regulation, Web 3’s purpose dissipates.
Currently, Cent’s plan to remove fraudulent activity from its service is to only allow the tale of “Valueless”. These NFTs most be “autographed” by their original posters to prove that they’re not stolen assets.