China’s biggest messaging app WeChat suspends NFT accounts
China has not released specific regulation around non-fungible tokens. But technology platforms like Tencent’s WeChat are taking a cautious approach to prevent speculation with NFTs.
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Tencent’s WeChat has suspended some accounts associated with so-called non-fungible tokens (NFTs) and clarified the rules around these digital collectibles.
NFTs are effectively digital tokens such as artwork that have boomed in popularity with some selling for several millions of dollars. They’re usually based on a blockchain platform, mainly Ethereum, with people paying for the tokens in cryptocurrencies.
But China has taken a tough stance on digital currencies, banning the trading of them in the country. NFTs in China are not bought with cryptocurrencies. Instead, people pay with the Chinese yuan. They’re also not built on a blockchain like Ethereum. Instead they are built on other blockchains that the regulators have oversight of.
However, there is no regulation of NFTs yet in the country. Users can buy these digital collectibles from a marketplace but secondary trading is heavily restricted. Because NFTs can be speculative, technology companies are taking a cautious approach so as not to get on the wrong side of any upcoming regulation.
Tencent said it has “rectified” public accounts on WeChat in order to prevent the risk of speculation in digital currency transactions.
A Tencent spokesperson did not confirm accounts had been suspended. But WeChat’s official account on Twitter-like service Weibo responded on Wednesday to a post by local media that reported the accounts were banned.
It clarified the rules around NFT accounts on its platform. Official accounts verified by Tencent can display digital collectibles but cannot offer secondary sales. They have to provide a certificate to show they are registered and approved by China’s cyberspace regulator.
Tencent said WeChat mini programs can only display NFTs. Mini programs are light versions of apps that run inside WeChat.