US Treasury Department issues first risk assessment on NFTs and their susceptibility to fraud and money laundering

The U.S. Treasury Department has conducted its first risk assessment into non-fungible tokens (NFTs) and found them to be highly susceptible to fraud, scams, and theft. The report highlights how NFTs can be used by illicit actors to launder proceeds from predicate crimes, and that NFT platforms currently lack appropriate controls to combat money laundering and sanctions evasion. As a result, the Treasury recommends further regulation of NFTs and the platforms they are traded on. This assessment differs from a previous U.S. government study in March, which concluded that no specific legislation was needed to address copyright and trademark concerns in the NFT market.