With China’s ban on virtual currencies nearing its end, the government has now shifted its focus to cracking down on the non-fungible token (NFT) market. In lieu of the authorities’ weekend notice on NFT trading, Chinese internet giants Tencent and Alibaba have denied allegations of launching their respective NFT trading platforms.
Internet giants flagged the NFT market as illegal
Both internet companies agreed to participate in the non-NFT digital collectibles business, but denied any connection to the decentralized token industry. The companies noted that NFT is directly related to cryptocurrencies that are banned in the country. Tencent established that they are committed to conducting their digital collectibles business within the compliance framework provided by regulators.
They noted that the company’s platform adheres to the government’s rules of complete user verification, including real name and content link review, and closed status. transfer of digital products between users and a strong resistance to illegal activities related to virtual currencies. Alibaba has also followed Tencent’s lead by making arguments against unethical NFTs because of their interconnection with cryptocurrencies. Furthermore, Alibaba compares the hype of NFTs to that of illegal cryptocurrencies.
“We firmly oppose all forms of speculation in digital collections, resolutely resist any form of illegal activities in the name of digital collections, which are actually virtual currency-related activities; resolutely resist any form of malicious speculation in the prices of digital collection commodities, and use technical means to ensure that commodity prices reflect reasonable market demand; resolutely resist any form of equity trading in digital collections, standardized contract trading and other illegal activities, and oppose the financial productization of digital collections.” , Alibaba Ant said.
Last week, China’s NFT market saw the government launch another crackdown, restricting non-counterfeitable tokens (NFTs) to mere digital collectibles. This means NFTs have been banned from for-profit trading, levying a ban on NFTs as part of a decentralized business. While authorities have interviewed internet companies to ensure that NFTs cannot be used as anything other than virtual collectibles, their market turned on a dime with speculation that Alibaba and Tencent were about to launch NFT trading platforms, but both companies have exclusively denied it.