ICIA takes a look at NFTs and finds out what the experts say.
What is an NFT? NFT stands for non-fungible token.
You may or may not have heard of this latest ‘hot’ investment utilising Blockchain technology
In economics, a fungible asset is something with units that can be readily interchanged – like money.
The units are stored on the Blockchain that certifies a digital asset. NFTs can be used to represent items such as artwork, photos, videos, audio, and other types of digital files.
The digital tokens can be thought of as certificates of ownership for virtual or physical assets.
Simply put, NFTs are like rare collectible baseball cards or action figures that leverage ledger technology, and exciting new advances in security to give value to what traditionally have been non-physical items.
$60billion per year art scene meets the Blockchain
NFTs can be used to invest in a painting such as a Picasso, which is one of a kind and there will only ever be the one original painting. The artworld is getting involved heavily in NFTs.
Stanford University Professor “Most NFTs are scams”
Stanford University adjunct professor – and former chief information security officer at Yahoo and Facebook – Alex Stamos covers topics from legislation around cookies to consumer intelligence, blockchain, privacy laws and NFTs.
What Alex Stamos said about NFTs caught our attention..
“Most NFTs are scams. If you’re buying an NFT, there is a good chance you’re being ripped off,” said Alex, who is working to improve the security and safety of the internet through his teaching and research at Stanford University.
NFT jpeg assets, for example, are not stored on the blockchain, he pointed out, with the ‘hash’ all that is protected. “The asset has to be stored somewhere else,” he said, noting that the legal system is behind the curve on this. There may not be any laws that say you can’t, for instance, modify the asset by one pixel and sell it over again.
“NFTs are a scam. People are getting ripped off left and right. I’m very much against people buying these.”
Are NFTs a Scam?
As with all investments involving cryptocurrency and the Blockchain, a very large percentage are scams. Criminals know that there is a lack of due diligence and victims are willing to part with cash easily and are so easy to fall for the ‘Get rich quick’ click bait.
ICIA Enhanced Due Diligence
ICIA are the experts in due diligence and wish to advise the public to perform due diligence before any type of investment.