Big bear Jim Chanos said on Thursday that the NFT market is riddled with “nefarious activity” and conflicts of interest.

Chanos said at an event on Thursday, “My concern is that related parties set prices for some NFTs in auctions or so-called sales; the prices are actually themselves.”

Chanos said that traders can set false and inflated market prices and then issue another set of NFTs for the public to buy at so-called large discounts. “That way they can profit from the 10x increase they just made. It's as old as the market. This is a money laundering deal.”

However, he added that regulating cryptocurrencies will be difficult.