The UK government’s watchlist now includes NFTs (Non Fungible Token). The UK government has expressed interest in finding out more about the opportunities and risks that NFTs pose. They have determined that NFTs are a bubble that will burst soon and drain investors’ funds, leaving them with significant losses.
Inquiry Into NFTs
Members of the UK House of Commons from the Sport, Media, Culture, and Digital sectors of the UK parliament have started an investigation into Non Fungible Tokens.
The DCMS (Digital, Culture, Media, and Sport) has requested that the public express their views on the benefits and drawbacks of these NFTs.
The danger presented by NFTs to investors will then be decided by parliamentary members.
According to the committee, NFTs could be a bubble that lasts just a short time, and long-term investors are greater fools who are at the mercy of this bubble and could lose their money at any time.
The committee statements also noted significant drops in NFT prices and trading volumes that occurred earlier this year.
Instability And Risks Associated With NFTs
The committee explicitly mentioned the NFT of Jack Dorsey’s tweet, the former CEO of Twitter. After being sold for $2.9 million during the peak of the NFT season, this NFT investment lost all of its value.
The committee’s chair, Julian Knight, alerts the public to the risk that awaits NFT investors when this “bubble” bursts.
Despite the absence of frameworks or laws for NFTs in the UK, with this inquiry, the government will be able to learn more about its benefits and drawbacks as well as the general consensus thanks to this new investigation.
After the appointment of Rishi Sunak as the new Prime Minister of the UK, the country is anticipated to become less antagonistic and more welcoming to cryptocurrency. Earlier this year, Sunak suggested that the Boris Johnson Administration launch an official NFT collection, however this idea was panned.
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