An OpenSea employee used insider information to purchase digital assets that were scheduled to be displayed on the NFT digital marketplace’s front page. The act highlights the risks associated with the use of confidential information to get an unfair advantage when trading blockchain-related products, especially non-fungible tokens (NFTs) and fan tokens.
Frontpage exposure of the non-fungible tokens (NFTs) was likely to raise interest in the digital collection. By purchasing them in advance, OpenSea’s employees would be able to sell them at a profit once they were displayed, as demand would likely increase.
This kind of behavior is market manipulation and can lead to loss of credibility of a project or more serious consequences with authorities. Except, to date, the cryptocurrency sector has experienced little regulatory enforcement, apart from those deemed securities in the United States.
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