John Reed Stark tweeted out NFTs, urging investors to stay away from non-fungible tokens. The ex-official called Twitter founder Jack Dorsey’s first tweet in the form of an NFT completely worthless, adding that bored monkeys in funny glasses and brightly colored hats also can’t be considered safe investments. According to Stark, the NFT market is rigged, it is not controlled in any way, and therefore creates favorable conditions for manipulation.
“NFTs are supposed to be completely decentralized. However, the image can be easily replaced if people with access to the servers change the filenames,” Stark wrote.
Smart contracts for NFTs also don’t contribute to clarity, argues a former SEC official. The code of smart contracts has not yet been sufficiently developed to fully cover the conditions that are usually prescribed in traditional contracts. At the same time, cryptocurrency platforms may not notify users of all conditions, resulting in legal disputes.
“The NFT bubble is already bursting, despite a huge number of celebrities shamelessly selling JPEG images to their fans, convincing them that this is a prudent path to financial success. No matter what Paris Hilton and other celebrities promise, buying collectible tokens is as absurd as buying a cobblestone in a cardboard box, ”Stark continued the exposure.
The former official believes that the NFT market is not controlled by regulators: it is not subject to net capital requirements, and issuers of tokens are not required to obtain a license and conduct an audit. Therefore, consumers cannot count on the protection of their rights. As Stark put it, the NFT is not just the Wild West, but a global post-apocalyptic anarchy in the world of finance. Buying NFTs is just for fun, it is pointless to hope that such investments will bring profit in the future.
Earlier, the ex-official expressed skepticism about stablecoins, calling USDT a house of cards that does not have a legal framework that can properly regulate the activities of the Tether company.
Source: Bits
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