Over 80 percent of NFTs minted for free on OpenSea are fake or plagiarized

OpenSea product lead resigns over use of insider NFT info for purchases

The marketplace hopes to prevent further abuse through tighter controls.

Jon Fingas
J. Fingas
September 16th, 2021
Over 80 percent of NFTs minted for free on OpenSea are fake or plagiarized
Jakub Porzycki/NurPhoto via Getty Images

OpenSea isn’t wasting much time after its head of product was accused of exploiting insider information to turn a profit on non-fungible tokens. The marketplace has asked for and accepted Nate Chastain’s resignation following claims he used secret Ethereum wallets to buy front-page NFT releases before they were available to the public. Chastain’s reported actions broke a promise to foster the NFT market “responsibly and diligently,” OpenSea said.

The company also tapped an unnamed third party to review its approach to unethical behavior and recommend changes. OpenSea promised to “quickly” implement any recommendations. It had already launched policies barring both the use of confidential info for NFT trading and for buying or selling from promoted creators and collections.

Chastain might not face further repercussions. As the law firm McMillan noted in a recent analysis, there aren’t any laws in North America regulating NFT sales. This incident and the response do set expectations for other NFT marketplaces, though, and they might invite more regulation from governments that otherwise left NFTs untouched.

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