Xiao Sa: There will be risk warnings sooner or later in the chaos of digital collection transactions

Today’s article may move some people’s cheese, but in order to call on old friends to pull back from the brink and be cautious about legal risks, it still has to be said. Nowadays, some platforms are very wild, the content is vulgar, the pictures are plagiarized and there is no original expression, and the hype studio is allowed to harvest the leeks, and the collection is not delivered. After a while, Sister Sa believes that official or semi-official institutions will issue risk warnings for NFT speculation, we will wait and see. It is recommended that digital collection practitioners conduct self-examination and self-correction to reduce the impact of legal risks.

NFT transaction behavior pattern

Digital collection transactions are divided into incidental transactions and business transactions . The former, as its name suggests, is an occasional transaction between the owner and the buyer of digital collections based on love for IP and other reasons. Usually, the law does not prohibit it, unless the subject matter of the transaction is one day legal. It is characterized as “contraband” or there are content issues such as pornography.

The latter refers to the business of selling digital collections, which can be divided into two categories: one sale ; multiple resale is allowed . Judging from the existing legal framework and the current policy trend, a sale of NFTs is widely recognized, and many manufacturers have asked for instructions. The conclusion is that there are no major legal flaws in a sale. However, the multiple resale situation has objectively caused the price of NFT to rise, and even hype. What’s more, the buyer did not come to buy the collection, but just to buy low and sell high to earn the difference .

Platforms that allow T+0-5 transactions will basically adopt two modes to deal with compliance challenges. One is to cooperate with various exchanges or trading centers. The logic is very clear, that is: continuous bidding, auction bidding, etc. frequently occur NFT transfers, which are easy to fall into the pattern of Circular 37 and Circular 38. The license comes with the business scope of the auction) to avoid it. However, as for the actual combat experience of a commodity trading market case undertaken by Sister Sa, the case was supervised by the Ministry of Public Security, and the platform involved was also an exchange reserved by the Provincial Financial Affairs Office. Business crime, first trial 7.5 years. In view of this, financial licenses such as local trading centers cannot prevent the risk of illegal business operations in Article 225 of the Criminal Law .

The second is to do it by yourself and adopt the information matching mode. In order to achieve the purpose of not cooperating with the exchange, the NFT trading platform has explored many parties, and finally adopted the consignment model modeled on the Erluxe platform , earning a handling fee of 5%-10% or even higher. It happened that Sister Sa passed the second-hand luxury goods appraisal. Teacher, familiar with the circle model. The current game of the second luxury platform is a mix of consignment sales and recycling. The reception staff generally encourage customers to sell luxury goods to the platform at a low price, and the platform will sell them at a high price after cleaning and packaging. For pawn shops, some provinces and cities have given “local food stamps” to encourage the transaction of second- hand goods – the circulation of second-hand living materials (this business is added to the business scope).

Analogy to NFT, are second-hand digital collections considered living materials? Can the platform also play the role of the largest market maker to invigorate the second-hand trading activity of NFT? Living necessities can barely be explained, but can be added to the business scope. Activity and market cap management , then, are serious issues.

Market value management is necessary

Generally speaking, if the price of NFT is controlled, use good news or the rhythm of the trainer to influence the price trend of a certain NFT , if it reaches a 20-40 times increase (this is the point of view of Sister Sa and a scholar discussing the case, but it is not It does not mean that less than 20 times is not a crime), it may be identified as fraud or even fraud .

Through observation, unless there is a fund disk, the current NFT trading platform on the market has no subjective idea of ​​fraud, but simply wants to revitalize the disk. This has led to some indulgences that turn a blind eye: some studios that specialize in hype enter the NFT trading venue, raise prices, harvest leeks, and the platform earns handling fees, neither supporting nor opposing it. However, the act of cutting leeks is a “zero-sum game”. The money made by the hype studio is the money of those who participate in NFT investment, and its behavior of raising the price has obvious purpose. Once the leeks are harvested very tragically, Stakeholder issues will arise. In the ICO era, similar issues will be dealt with as the crime of fraud, and in the P2P era, they will be dealt with as the crime of fundraising fraud. Well, the laissez-faire behavior of the platform has become a necessary condition for cutting leeks . In addition, the legal nature of NFT itself is vague, and the platform itself does not have a hard license. In the eyes of the police, this may be no different from helping others cheat money. On the one hand, it may be On the other hand, there may also be problems such as helping letters, money laundering, etc. (since the platform often comes to prostitutes and does not pay lawyers’ fees, Sister Sa will not argue). Seeing this, friends of Dachang may secretly rejoice. In fact, there is also a risk of money laundering in the transfer of gifts, especially when the price of a single collection is high.

Risks suggest possible directions

Sister Sa believes that, compared with the shoe-frying boom in previous years, it will be similar to the risk warning of the year, but it will increase the public chain and financial attribute warnings.

1. There is a securitization trend, and the daily trading volume is huge . This requires that you can’t buy short and sell short, and each transaction must be delivered. For NFTs, you should pay attention to the transfer of control. At the same time, continuous bidding transactions cannot be adopted, and auctions cannot be held without an auction license.

2. Some third-party payments provide instalment payment and other leveraged services, which contribute to financial risks . Cancel credit card transactions, try not to provide installment services, reduce the unit price of collections, and prevent high leverage and bubbles.

3. To prevent black box operations, platforms and big players suddenly run away, which can easily lead to mass incidents . In the field of digital wallet financial management, there have been many black box operations before, which also caused some risks. The NFT field is mainly worried about hoarding by big players or dealers, starvation marketing, and most platform copyright licensing contracts have loopholes. Under the combined attack of various factors, once the platform is out of stock or the players disappear, stakeholder risks will appear in minutes, and It is difficult to resolve it by the platform alone.

4. If NFT is combined with overseas public chains, and NFT is mentioned in digital wallets and then sold on overseas platforms, it may cause problems such as capital flight and the foreign exchange management system being overlaid .

write at the end

It is hoped that this article can attract the attention of practitioners, resolve risks in a timely manner, do a good job in KYC, expel malicious players, and reduce stakeholder risks . Only when the whole industry becomes more and more transparent and refreshing, can it develop sustainably and healthily. Looking forward to the legal and compliant operation of the digital collection platform for a long time…

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/xiao-sa-there-will-be-risk-warnings-sooner-or-later-in-the-chaos-of-digital-collection-transactions/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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