WeChat suspends a dozen NFT public accounts to clean up crypto speculation and reselling

·3-min read

Tencent HoldingsWeChat, China’s largest social network with more than 1.2 billion users, has frozen multiple accounts that market digital collectibles, the term typically used in China to refer to non-fungible tokens (NFTs) that cannot be bought or sold using cryptocurrencies.

At least a dozen WeChat public accounts, used for publishing and pushing content out to followers, have been suspended for the last two weeks, according to a search by the South China Morning Post.

The accounts include Huasheng Meta and Spirit Leap, which said publicly that they were suspended after “being reported by others”. The shuttered accounts can no longer be found in search results, and existing subscribers accessing the pages are greeted only with a line saying the accounts have “no legal permit or licence to publish, disseminate, or engage in related business activities”.

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Tencent, Alibaba tighten NFT rules in preemptive move to avoid scrutiny

The crackdown on NFT-related content comes as domestic digital collectibles, which cannot be resold for profit, have gained popularity among some Chinese consumers and investors. The central government has been wary of NFTs, fearing a speculative bubble.

A WeChat representative said in a written statement that the platform recently enforced “regulation and rectification on public accounts and mini programs that speculate on or resell digital collectibles”. Mini programs are lighter versions of mobile apps that run completely within WeChat.

Public accounts can only “display and support the initial sale of digital collectibles”, and operators must “provide proof of cooperation with a blockchain company that has been recognised by the Cyberspace Administration of China”, the person said. “Resale is banned.”

Crypto-related products are strictly regulated in China, and cryptocurrencies are banned. This is why digital collectibles cannot be legally resold, although ownership can be transferred after a specified period of time.

Since NFTs became a global phenomenon last year, state-backed media has maintained a critical tone. Communist Party mouthpiece People’s Daily published a piece in November questioning NFT investment fever, calling it a “zero-sum game hyped by cryptocurrency investors and capital”. Securities Times, which is managed People’s Daily, warned in a separate piece in September of a potential NFT bubble.

To comply with regulations, Big Tech companies have sought to keep a tight lid on NFT-related activities. WeChat has been censoring NFT operators since late February, when it suspended the mini program of TheOne.art, a local digital collectible platform, which has since resumed operation.

Around the same time, Ant Group’s digital collectible platform Topnod punished 56 accounts for participating in the resale of digital collectibles for profit. In January, more than 300 additional accounts were punished for using plug-ins and scripts to snap up digital collectibles.

Ant, operator of Alipay, is the fintech affiliate of Alibaba Group Holding, the owner of the South China Morning Post.

Despite the Chinese government’s apparent wariness, it has no official stance on NFTs, which are unique strings of data authenticated on a blockchain that are typically tied to digital works like art. The government has even promoted the development of blockchain technology.

Beijing’s Olympics mascot NFTs to open for sale, but not in China

Many of the country’s tech giants have rushed to capitalise on the NFT trend since last year. In addition to Ant and Tencent, e-commerce firm JD.com operates a competing NFT platform. Search engine Baidu and smartphone maker Xiaomi have also sold their own digital collectibles.

Tencent’s platform Huanhe, launched last August, has not been affected by WeChat’s latest rectification efforts.

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