WeChat, Tencent’s social messaging app, has suspended some accounts linked to so-called non-fungible tokens (NFTs) and clarified the rules surrounding them.
Essentially, NFTs are digital art tokens, which have become extremely popular with some achieving multimillion-dollar prices. They are usually based on an Ethereum blockchain platform, which is paid for in cryptocurrency.
China, on the other hand, has taken a hard line against digital currencies, banning their trading in the country. Currently, Chinese people do not buy NFTs with cryptocurrencies. Instead, they use the Chinese yuan. They are also not built on a blockchain like Ethereum. Instead, they rely on other blockchains that are regulated by the government.
Currently, there are no regulations in place for NFTs in the country. Users can purchase these digital collectibles on a marketplace, but secondary trading is highly restricted. Tech companies are taking a cautious approach to NFTs due to their potential to be speculative, so as not to fall foul of any upcoming regulations.
The company said it “corrected” public accounts on WeChat in order to prevent speculation in digital currencies.
WeChat’s official account on the Weibo microblogging site responded to a post by local media on Wednesday which reported the accounts had been suspended. However, Tencent did not confirm the suspension of the accounts.
A new set of rules regarding NFT accounts was clarified on its platform. They need to show a certificate to prove they are registered and approved by China’s cyberspace regulator to have access to digital collectibles. Tencent’s officially verfied accounts can display digital collectibles, but not sell them.