Wechat will restrict accounts from offering certain NFT and cryptocurrency services.
According to a news source, Tencent’s Wechat plans to penalise public accounts that facilitate the secondary trade of NFTs. The new law also targets accounts that provide cryptocurrency transaction channels and advice. The Chinese internet giant Tencent’s instant messaging, social networking, and mobile payment app Wechat is launching a policy change that would forbid the offering of specific services linked to cryptocurrencies and non-fungible tokens (NFTs) on its platform.
Tencent “provides services or associated materials for secondary trades with digital collectibles and will seek modifications if some features are blocked or accounts are banned,” according to the South China Morning Post (SCMP). The information follows Wechat’s April announcement that many NFT-related accounts had been suspended. Penalties are also part of the policy update for accounts that provide Wechat users with trading channels, tips, or cryptocurrency. Accounts that permit trading in initial coin offerings (ICOs) and cryptocurrency derivatives may also be impacted. The paper claims that while making judgments, Wechat executives are taking into account the Chinese government’s advice that businesses in the sector avoid the financial aspect of such actions.
Chinese digital collectibles are produced on consortium blockchains, which are closed blockchains as opposed to open blockchains like Ethereum. The April suggestions suggested that they be acquired with Chinese yuan using real identities to lessen the likelihood of money laundering. Wechat also stated that accounts that display digital collectibles and primary transactions would have to enter into agreements with blockchain companies recognised by the Cyberspace Administration of China (CAC) and refrain from supporting secondary trading, according to SCMP’s additional citation of it. According to the magazine, consumer brands and Chinese state media have joined the NFT bandwagon since last year with collectibles based on blockchains created by the major digital firms including Alibaba Group Holding, Tencent, Baidu, and JD.com.
Read more: As Bitcoin loses ground, mining operators worry about what lies next for the industry.