Even as NFT crime skyrockets and Forrester declares all of Web3 the seed of a dystopian nightmare, Visa has announced it is jumping in. The head of crypto at Visa states in the article: “We think NFTs represent a new form of e-commerce.” Maybe, but so far it has been criminal acts that dominate the headlines and even WeChat bailed on the idea of enabling NFTs. The criminal activity is driven by the lack of validating the ownership of the NFT site itself (perhaps merchant services onboarding could help?) and a lack of provenance for many of the objects the NFTs encapsulate (a harder problem to solve). These attack vectors are exacerbated by the lack of rigorous identity verification for all the buyers and sellers on many NFT sites which enables kiting and money laundering.
The press release indicates Visa will educate artists through “technical and product mentorship,” but few artists are likely to have the technical knowledge required to properly evaluate all aspects of the platform. They certainly won’t have the leverage required to convince NFT platforms to fix any problems they discover. I’d like to see Visa utilize its technical and regulatory capabilities to develop a “NFT Certified by Visa” program. This would provide a safe harbor for buyers and sellers and Visa’s broad brand awareness would surely compel some NFT platform providers to make the changes needed to participate.
With a properly secured platform (PCI certification perhaps?) and with solid identification required to participate, fraud would be more easily detected and make it easier to make those criminals face justice.
“Aside from collecting NFTs, Visa has built out its crypto team, and in December 2021 launched a crypto advisory practice to help clients and partners consider a deep dive into the space.
“We think that [NFTs] are a fundamental primitive tool that can reshape commerce and create new opportunities,” Sheffield said. “But there’s still a ton of questions around how does it evolve? Which blockchains to use? How do you stand out? How do you reach customers? And so we want to learn as much from the creators as we think they can learn from us.”
Going forward, Visa wants to embed itself in these crypto technologies to follow the future of commerce, Sheffield said. “We’re incredibly excited about NFTs,” Sheffield said. “We want every [NFT] marketplace to be able to accept Visa cards because we think NFT’s will exist across many different networks.”
As for next steps? Visa wants to make buying an NFT as easy as it is to buy anything else online, Sheffield said.”
And still no mention of safe.
Overview by Tim Sloane, VP, Payments Innovation at Mercator Advisory Group