WeChat Blocks NFT Marketplace Promoting Accounts
- WeChat blocks ten public accounts linked to NFT marketplaces.
- Government and regulatory interest in NFTs have surged due to a marked increase in illicit activity.
- Failure to rein in illicit activity could see China take harsher measures.
It’s been a busy first quarter for digital assets and NFT marketplaces. Governments and regulators across key digital asset jurisdictions have taken steps to curb investor enthusiasm.
Despite the marked increase in regulatory scrutiny, activity within the NFT space has surged. As the year progresses, more mainstream players are planning NFT launches. With increased activity comes increased illicit activity and even greater regulatory scrutiny.
While China has prohibited Bitcoin (BTC) trading and mining, NFTs are permissible under current regulations.
WeChat Targets Accounts Promoting NFT Marketplaces
This week, news hit the wires of WeChat blocking accounts promoting NFT marketplaces. Owned by Tencent, WeChat has blocked ten in total. These include Art Meta Yuanyishu Yidianshuzang, One Meta, Earth Zero, Guizang Metaverse, Huasheng Meta, Yuanben Space, Shenda Shuzang, iBox, and Nuofangti.
According to reports, WeChat banned the accounts to eliminate the risk of speculative digital asset trading. WeChat also prohibits second-hand trading on the WeChat platform.
The public accounts in question must now present a certificate of cooperation with a blockchain company, registered and approved by the Cyberspace Administration of China (CAC).
Headquartered in Beijing, CAC is China’s central internet regulator, censor, oversight, and control agency.
China Takes a Tough Stance on Digital Assets and the Metaverse
Despite increased regulatory scrutiny, NFT and Metaverse activity is rising in China.
In February, FX Empire reported Metaverse-related trademark applications hitting 16,000. The surge in trademark applications came despite strong warnings from the Chinese government.
This year, we reported the Chinese government taking a greater interest in NFTs and the Metaverse. A rise in illicit activity led to discussions at China’s Two Sessions.
The People’s Bank of China (PBoC) is looking to clamp down on NFTs and the Metaverse using AML tools. In December, the PBoC’s AML unit talked of virtual assets being the pathway for illegal activities facilitated by the isolated nature of NFTs and Metaverse-based items.
The risk for NFT and Metaverse-related firms is a continued rise in illicit activity, leading to an outright ban on NFTs.
China is not alone in its stand against NFT and Metaverse-related activity.
This year, the Monetary Authority of Singapore banned the advertising of digital assets, with UK Members of Parliament also voicing concern over cryptos and NFTs.
Amidst increased regulatory scrutiny, more social media platforms could follow WeChat and even totally ban digital asset-related accounts. Much will likely depend on whether regulators can curb illicit activity, which plagues the crypto market, NFTs, and the Metaverse.