China’s top social media platforms and internet giants have revised their policy to remove or restrict nonfungible token (NFT), platforms. They cited a lack in regulatory clarity and fearing government retaliation.
WeChat, a Chinese social media company, reportedly deleted several accounts on digital platforms that were violating the rules. Digital collection platform Xihu No.1, which was one of the most popular NFT projects on the market, was also among those platforms that were removed. A local newspaper reported that Dongyiyuandian, another platform, had its official app banned.
WhaleTalk, an online platform for digital collectibles, was also launched by tech giant Ant Group. It updated its policy to increase penalties for using an OTC desk to trade NFTs. NFTs may not be banned but speculative trading involving digital collectible tokens is prohibited. Here is a portion of the Google-translated report:
“With the uncertainty surrounding digital collection compliance, many platforms have taken active steps to crack down on violators to stop the fermentation of similar behaviors.”
Many tech companies have taken precautionary steps to prevent illegal transactions and bot purchases that are associated with NFT platforms. Any firms that were found to be involved in crypto transactions or foreign cryptocurrency firms were made accountable during the September 2021 blanket ban on crypto. These firms’ actions and modifications to user agreements policies appear to have been done to avoid government crackdown.
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Although cryptocurrencies are prohibited in China, the Beijing government has not stated that it intends to ban NFTs. Tencent and Alibaba were able to file several NFT patents this year due to this. But, price speculations and frauds have also increased due to the popularity of digital collectibles from China.