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6th December 2021


The oldest defense and security think tank worldwide, the Royal United Service Institue for Defense and Security (RUSI), published a report that covers the threats of the emerging non-fungible token (NFT) asset that could contribute to money laundering and terror finance activities. 


RUSI raised an issue that rings an alarm for money laundering and terror finance. The users buy NFT with cryptocurrencies and on an online marketplace. Cryptocurrencies are regularly changing their nature of transactions, and due to their anonymity and unease backtracking of the source, NFTs are used for money mulling and illicit activities. It is becoming hard for law enforcement to trace the source and destination. Money Laundering Considered Commonplace in Traditional Art Market — RUSI Researchers Say an Art Heist Is Also Possible Within the NFT Realm. 


Security researchers point out that criminal actors can also infiltrate NFT markets and exploit novel risks. They say criminal actors can hack into accounts on NFT markets and then transfer NFTs to their accounts. Transferring the NFTs, the hacker can sell the tokens quickly and attempt to launder the proceeds. 


RUSI said this could be stopped by implementing rigid Know Your Customer (KYC) policies and stringent AML procedures followed by good cyber security techniques. 


Source: RUSI Org

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