Wechat banned crypto content and accounts associated with NFTs as well after its ToS upgrade as we can see more today in our latest cryptocurrency news.
China had a rocky relationship with the world of Blockchain and crypto for the past few years but originally a country that was focused on mining and trading, 2021 led to a crackdown on almost everything due to high energy consumption and a gateway for operations that were frowned upon by the government. The crackdown led to all crypto mining being banned in China with most miners moving to other countries like Kazakhstan and Iran. Both of these nations used the situation and created regulatory frameworks as well as established crypto busienss endeavors with some minor restrictions.
WeChat with more than 1.1 billion daily active users in China, has updated its rules: WeChat public accounts which involved in the issuance, trading and financing of crypto and NFTs will be limited function or banned. https://t.co/0I9oMrvFTp pic.twitter.com/mzclYjFZNg
— Wu Blockchain (@WuBlockchain) June 20, 2022
Some form of digitally related research is underway in China, especially around CBDCs. However, with its update, Wechat banned crypto content with over 1.1 billion users decided to ban all content that promotes digital assets. The change in WeChat policy towards the crypto space was unearthed by Hong Kong journalist Colin Wu. Before the update, NFTs were in a gray area in China. Some cryptocurrencies were targeted by regulation but the WeChat ToS upgrade is aimed at NFT specifically:
“Accounts that provide services or content related to the secondary transaction of digital collections shall also be dealt with in accordance with this article.”
The new ToS goes on to state that all accounts determined to be involved with virtual currencies will be shadowbanned or terminated depending on the violation. NFTs were ignored by Chinese regulatory bodies in the past and a report by China times indicates that the number of platforms in the region increased from 100 to over 500 in 2022 alone. According to Wu Junjie, most of these are bogged down by confusing compliance procedures:
“Regarding the compliance of intellectual property rights, the Hangzhou Internet Court in the first domestic NFT case determined that digital collection platforms need to undertake a higher pre-examination obligation, and has launched a strict examination and reporting mechanism for digital collection businesses.”
The increase in interest for NFTs culminating in the legal case could have brought those assets under regulatory scrutiny which prompted WeChat to target digital collections as well as crypto.
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