China is recognized and still remains the country that has placed stringent measures and regulations on NTFs and cryptocurrencies. The Chinese government last year executed a total crackdown and restriction on crypto mining and other types of crypto-related activities.
These attacks by the Chinese authority shook the crypto market as several mining companies within its jurisdiction had to shut down. During the crackdown, the price of various digital assets, Bitcoin inclusive plummeted leaving investors with huge losses and the market in a blood bath.
In fact, this influence of the Chinese regulation and crackdown on the crypto market last year will remain as one with a historical effect. And now while the coast seems to be clear, there looks to be another storm coming.
Fears among investors now seem to be growing as the news of another crackdown from the Chinese authorities spread. This time around, the crackdown is said to be against top social media platforms and internet giants. They are WhaleTalk, Tencent, and WeChat.
According to reports, these firms have begun updating their policies to stop their platform from interacting with NFTs. The lack of regulatory clarity as regards the direction of the Chinese government is also one of the reasons why these firms are updating their policies. Better safe than sorry right?
Clearly, anticipation is high, so these proactive measures are towards the uncertainty of controls and regulations to be dished by the government as regards the speculative trading of these virtual assets.
Even though the Chinese authorities took a rigid anti-crypto stance last year, the government seems to be more relaxed when it comes to NFTs. However, it will be discerning to bring under control any collection that looks like speculative trading including the utilization of trading bots within the NFTs space.
Therefore, to tackle this, Wechat, a giant social media platform in China has removed several accounts linked with NFTs from its platform. Wechat took this action, citing illegal trading and policy violation as the primary reason for the action. To note, the top virtual collectible platforms, DongYiYuanDian and Xihu No1 had their accounts suspended on the platform.
To add to this WhaleTalk, the digital collectibles arm of the Ant Group, and Tencent, the parent company of WeChat have also updated their policies. The latest policy saw a change in penalties for carrying out illegal activities and misusing the services of the companies into a harsher one.
These actions by all three companies are only a response to the lack of regulatory clarity in the NFT space. It is expected that firms will continue to update their policies into stringent ones until the Chinese authorities eventually make their move.