Chinese tech giants remove NFTs from their platforms because they fear a government crackdown as was the case with WeChat. In today’s crypto news, we take a closer look at these companies’ decisions.
WeChat removed a few accounts for digital collectible platforms for violating the policy of the illegal trade while Ant Group NFT platforms updated their user agreements. The Chinese tech giants and leading social media platforms updated their policies to restrict or remove NFT platforms due to lack of regulatory clarity and fearing government crackdown.
Wechat removed a few digital collectible platform accounts for violation of the rules. Xihu no.1 is one of the hyped NFT projects in the market which was among the removed platforms while another was Dongyiyuandian which revealed that the official app has been banned. WhaleTalk is a digital collectible platform that is launched by tech giant Ant Group and also updated its policy to increase the penalties for using a counter desk for trading NFTs. It’s important to note that even though NFTs are not banned, any form of speculative trading related to digital collectibles is still prohibited:
“Under the background that the compliance of digital collections is not clear, many platforms have begun to actively crack down on violations to prevent further fermentation of related behaviors.”
The rise in the number of illegal transactions and bot purhcases related to NFT platforms promoted a few tech giants to take some precautionary measures. During the ban on crypto announced in September 2021, companies that found aiding crypto transactions or foreign crypto companies were held accountable. The companies’ actions and changes in user agreement policies now seem to try to avoid government crackdown.
While cryptocurrencies are banned in China, the Beijing governemnt showed no intention of banning NFTs which was one of the key reasons for Tencent and Alibaba to file NFT patents over the past year. However the rising popularity of the digital collectible in China, also made it prone to price speculation and fraud.
As recently reported, The Federal Reserve will work with China’s Cypherium as the blockchain company featured in the FedNow Service Provider showcase in order to bring instant payments. The FED launched the provider and aims to provide financial institutions and users with a range of services to help them implement the service which will launch in 2023.
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