It’s no secret that China has a clear disdain for all things crypto, as was highlighted last year when the country decided to ban its digital asset industry in its entirety. That said, one niche related to the crypto industry that has continued to thrive in the region despite the ban is its nonfungible token (NFT) market. However, with certain negative developments coming to the forefront recently, this may not be the case much longer.
In this regard, many local social media platforms and internet firms have continued to update their policies so as to restrict and, in some cases, remove NFT platforms altogether from their networks, claiming a lack of regulatory clarity but, more importantly, fearing a government clampdown on their day-to-day operations.
For example, WeChat, a Chinese instant messaging and social media service that boasts of an active customer base of over 1 billion users, recently took down one of China’s most prominent NFT ecosystems Xihu No.1 from its platform, stating that it was violating its active rules of service. Similar actions were also taken against other projects, including Dongyiyuandian.
In a similar vein, Ant Group-backed WhaleTalk, a digital collectible platform, has increased the penalty for individuals making use of its over-the-counter desk for the purpose of NFT trading in a recent policy update.
Vagueness regarding NFTs reigns supreme in China
While the use of cryptocurrencies is completely banned across mainland China, the Xi Jinping regime had not shown any intentions of banning NFTs up until now. This is best showcased by the fact that Chinese business juggernauts, such as Tencent and Alibaba, have filed for several new NFT patents over the past year.
However, as with any evolving market, the rising popularity of digital collectibles in China has resulted in many of these offerings being subject to intense price speculations and consumer fraud cases. To this point, the growth of illegal transactions and bot purchases associated with NFT platforms has resulted in many…