SrNFT: Simple Restricted Non-Fungible Token Framework for Transactions With Risk Detection

Abstract

Due to the rapid growth of Non-Fungible Tokens (NFTs), the current total market value of worldwide NFTs is at 1.05 billion dollars. The massive trading market increases the issue of blockchain supervision — transactions employing NFT to money laundering occur on a regular basis. However, most of the current domestic platforms do not support trading in the secondary market of digital collectibles, while there is a lack of foreign research on the regulation of NFT trading. The economic benefits of NFT have considerable potential to greatly enliven the market. The main purpose of this paper is to study the regulation of NFT ecology. Therefore, we provide a regulatory framework for NFT that realizes ex-ante regulation, and study two major modules of money laundering detection and regulatory control for NFT. In addition, to enhance compatibility, we also provide alternative ways to the proposed framework, aiming to provide new standards and guidance on the regulation of NFTs.