Central Bank of Taiwan Warns Investing in NFTs Could Be Dangerous (Report)

Please fol­low and like us:
Pin Share

The Cen­tral Bank of the Repub­lic of Chi­na (Taiwan’s cen­tral bank­ing insti­tu­tion) report­ed­ly warned that the non-fun­gi­ble token (NFT) sec­tor is full of fake trans­ac­tions. As such, it advised investors to beware when deal­ing with such dig­i­tal collectibles.

Investing in NFTs Hides Risks

Accord­ing to a recent report by the Tai­wan News, the nation’s cen­tral bank does not find dab­bling with NFTs as an appro­pri­ate invest­ment strat­e­gy. Cit­ing a sur­vey, the insti­tu­tion remind­ed that less than 30% of investors prof­it when sell­ing dig­i­tal col­lectibles, while every third pro­duced art­work doesn’t end up sold.

NFTs could define both dig­i­tal and phys­i­cal objects. As such, one could prove own­er­ship over those assets and ver­i­fy their authen­tic­i­ty. The bank, though, argued that this qual­i­ty is doubt­ful since every indi­vid­ual can pro­duce a dig­i­tal col­lectible and use it to steal data.

Last year, the Amer­i­can YouTu­ber – Logan Paul – joined the NFT craze by part­ner­ing with Bond­ly Finance. They vowed to cre­ate and dis­trib­ute non-fun­gi­ble tokens for Paul’s “Poke­mon Break Box.”

Sev­er­al months lat­er, the Amer­i­can dived into the space again, but his actions sparked doubts among investors. He was alleged to have pho­to­shopped stock images for his Cryp­to­zoo project and lat­er sold those fake items to investors for mil­lions of dollars.

The cen­tral bank of Tai­wan fur­ther not­ed that despite its progress last year, the NFT mar­ket has slowed down recent­ly. The num­ber of traders was not more than 75,000 in 2020, while a year lat­er, it sky­rock­et­ed to 2.3 mil­lion people.

It is also worth not­ing that NFT trad­ing vol­umes were chart­ing their most impres­sive peaks last sum­mer. At the end of August, they exceed­ed $500 mil­lion for a sin­gle day. How­ev­er, the trends changed, and the craze start­ed cool­ing off in September.

Bill Gates’ Thoughts on NFTs

Last week, the Amer­i­can busi­ness mag­nate and Co-Founder of Microsoft – Bill Gates – advised investors to pay extra atten­tion when trad­ing NFTs because they are based on “the greater fool the­o­ry.” The bil­lion­aire sar­cas­ti­cal­ly not­ed that “dig­i­tal images of mon­keys are going to improve the world immensely.”

With his com­ments, he most like­ly referred to the Bored Ape Yacht Club (BAYC) – an NFT col­lec­tion fea­tur­ing dif­fer­ent car­i­ca­tures of mon­keys. Despite Gates’ neg­a­tive opin­ion of them, numer­ous celebri­ties have already spent mil­lions to acquire some of the col­lectibles. The singer Madon­na, the Brazil­ian soc­cer star Ney­mar, and the ten­nis cham­pi­on Ser­e­na Williams are some examples.

SPECIAL OFFER (Spon­sored)

Binance Free $100 (Exclu­sive): Use this link to reg­is­ter and receive $100 free and 10% off fees on Binance Futures first month (terms).

PrimeXBT Spe­cial Offer: Use this link to reg­is­ter & enter POTATO50 code to receive up to $7,000 on your deposits.

Source link

Please fol­low and like us:
Pin Share

Leave a Reply

Your email address will not be published. Required fields are marked *