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Chinese Social Giant WeChat Remove NFTs Due To Regulatory Issues

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China remains one of the jurisdictions that has recently meted out stringent measures and cryptocurrencies and NFTs. The Chinese authorities leased out a high level of restriction and crackdown on crypto mining in 2021.

The major attack was pushed on Bitcoin mining because of its high electricity consumption associated with the process. Also, the country was concerned with the increased environmental pollution that goes with cryptocurrency mining.

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The attack from China government brought the shutdown of several crypto mining firms within the country. During the attack, the price of crypto tokens, especially BTC, plummeted drastically. The influence of the Chinese crackdown on crypto price performance last year will remain a historical impact.

Similarly, there’s a recent fear of a possible crackdown for the Chinese government on some leading internet giants and social media sites. They are WeChat and WhaleTalk.

The firms are already updating their policy to restrict platforms dealing with non-fungible tokens (NFT). Also, the mentioned the lack of regulatory clarity as part of the reasons.

WeChat Opts For Policy Updates By Removing NFTs

For WeChat, the social media and internet giant has removed some accounts from its collectible digital platform. Its reason was tied to their violations of rules for operations.

A report from a local daily mentioned that Xihu No.1, a digital collection platform that is part of the hyped NFT projects within the NFT market, was among the platforms that WeChat removed. Also, Dongyiyandian disclosed the banning of its official app.

Similarly, WhaleTalk, on its part, renewed its policy to increase the sanctions for using an Over-the-Counter ‘OTC’ desk in the trade of NFTs Ant group, a tech giant, launched WhaleTalk as a digital collectible platform. Although there’s no ban on NFTs, there’s a prohibition of any speculative trade with NFT collectibles.

There’s Google-translated information explaining the actions of many platforms based on not having clear compliance of digital collections. These platforms have started intense suppression for violations of compliance. Their move is to stop further implications that could develop from such activities.

More technological giants are taking precautions to combat the risk associated with NFT purchases. This is due to the surge in illegal transactions and bot trading on most NFT platforms.

As announced on September 2021, at the blanket ban on crypto, there are penalties for companies that help crypto transactions or other foreign crypto companies.

Cryptocurrency market stands above $1.8 trillion | Source: Crypto Total Market Cap on TradingView.com

Hence, these companies’ recent changes in policies are purposely actions to avert possible crackdown from the government.

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Though mainland China has a total prohibition on cryptocurrencies, the Beijing government has not banned NFTs.

This explained why Alibaba and Tencent filed for some new NFT patents in 2021. However, despite its progress, as digital collectibles are more popular in China, there’s an increase in both their price speculation and potential fraud actions.

Featured image from Pixabay, chart from TradingView.com



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