The leading Chinese social media platform, WeChat has started a large-scale regulatory process that involves banning and restricting NFTs that do not meet the conditions dictated by the Chinese government.
So, recently, the platform, through its parent company, Tencent, modified the rules that guide NFT projects residing on its platform.
Therefore, the stipulated rules were implemented as proactive measures that would allow Tencent to comply with the regulatory requirements of the government of China.
Thus, according to the new regulations, all projects involved in the minting and trading of NFTs are required to provide certificates of cooperation with blockchain companies registered and approved by the Cyberspace Administration of China.
Therefore, only with this certificate the projects are authorized to operate on the platform.
WeChat and NFTs
So, according to WeChat’s regulatory setup, any project that violates these standards or tries to ignore them will be banned and immediately removed from the platform.
In China, NFTs are called digital collectibles rather than tokens.
Thus, cryptocurrencies have been criticized in China for negatively affecting the country’s financial sector by allowing unsupervised transactions.
Such transactions were assumed to facilitate different forms of financial crimes, including money laundering and fraud.
Furthermore, Proof of Work (PoW) systems for mining BTC and other cryptos do not align with China’s goals regarding carbon neutrality.
Thus, although it has cracked down on the cryptocurrency industry, the Chinese government has said yes to the NFTs and experts have highlighted that WeChat’s stance reinforces the Chinese government’s success in controlling the crypto industry in the country.
With the growing popularity of NFTs, tech giants in China such as Tencent and Alibaba have joined the queue for adoption of the emerging technology.
Thus, according to forecasts, the NFT market in China is expected to grow at an annual rate of 150%, reaching a market size of around US$4.64 billion by 2026.