April 09, 2024
By Sharan Kaur Phillora
WeChat, China’s most used social media platform with over 1.1 billion daily users, has announced a ban on accounts related to cryptocurrencies and non-fungible tokens (NFTs). The revised “Code of Conduct” under Section 3.24 now categorizes the issuance, trading, and financing of virtual currencies as “illegal business” activities, subjecting involved accounts to restrictions or permanent bans.
Here’s what we know:
The crackdown extends to accounts facilitating secondary trades of NFTs, aligning with China’s tightened grip on digital assets. Colin Wu, a prominent Hong Kong-based crypto journalist, highlighted this development on social media, sharing excerpts from the updated policy.
It specifically targets transactions between virtual and real currencies, information intermediary services for virtual transactions, and activities around token issuance financing and virtual currency derivatives trading.
Violations of these new rules will prompt WeChat to enforce corrective measures on offending accounts, ranging from function restrictions to outright bans, based on the severity of the breach. Offenders are required to present a partnership certificate with a blockchain enterprise registered and approved by the Chinese Cyberspace Administration to lift the ban.
This move aligns with China’s broader regulatory stance against digital assets, including previous bans on cryptocurrency usage and mining. The Chinese government has expressed concerns over the risks associated with digital assets, such as potential money laundering, prompting financial and security institutions to mitigate these dangers.
Despite the regulatory clampdown, the allure of NFTs continues to grow in China. Reports indicate a significant surge in digital collectible platforms, from just over 100 in February 2022 to more than 500 currently. This boom reflects the burgeoning interest in digital collectibles among Chinese consumers despite the regulatory uncertainties and the government’s cautious approach towards digital asset proliferation.
About the author
Sharan Kaur Phillora’s thirst for knowledge has led her to study many different subjects, including NFTs and Blockchain technology – two emerging technologies that will change how we interact with each other in the future. When she isn’t exploring a new idea or concept, she enjoys reading literary masterpieces.
