The Domestic NFT Commerce That OpenSea Supports Is Acknowledged.
Key Sentence:
- A team member at OpenSea, the most prominent digital collectibles marketplace, uses insider knowledge to purchase NFTs before being advertised on the website.
NFT is a unique digital token derived from art that has grown in popularity over the past year, some of which have sold millions. NFTs are purchased with cryptocurrencies, most commonly Ethereum (ETH), stored in a permanent digital ledger called a blockchain, where every transaction is registered and publicly available.
The crypto community on Twitter uses these records to uncover activity through a series of transaction screenshots. One user, ZuwuTV, accused Nate Chastain, OpenSea's product manager, of selling NFT "shortly after profits soared on the first page."
OpenSea did not name Chastain and did not immediately respond to a request for comment. Domestic trading – where individuals use non-public knowledge for financial gain – is illegal in most regulated markets. But the NFT market has no such limitation.
New guide
OpenSea said it was implementing new guidelines that prevent team members from "using confidential information to buy or sell NFT, whether it's available on the OpenSea platform or not."
"Strangely, OpenSea is only now making it a rule that employees shouldn't act against their customers," said David Gerard, author of The 50-Foot Blockchain Attack. "This is a working example of the need for regulation in the crypto world, and it is worth mentioning to include the NFT market.
"It also shows that if you are doing something that may be questionable, it may not be advisable to do it on a permanent public blockchain that displays all transactions."