According to official media, China already has over 500 digital collector sites, a fivefold increase in just four months.
Despite its anti-crypto reputation, China has yet to prohibit NFTs. Meanwhile, there has been a noteworthy increase in interest in “digital collectibles” in the country, despite the government’s warning that citizens should not exchange digital assets.
Collectibles in the Digital Age Popularity Is Growing
After enacting a broad crypto prohibition in 2021, it’s no longer a mystery that China has no plans to integrate cryptocurrencies into its monetary system. However, the world’s second-largest economy has yet to establish specific restrictions or prohibitions aimed at Non-Fungible-Tokens (NFTs), which are closely linked to native tokens of layer-one blockchains like ETH and SOL.
According to a survey published by Huaxia Times, a state-owned daily, the country now has over 500 venues for trading digital artifacts, up from around 100 in February of this year.
According to the press, the lack of rules is to blame for the space’s uncontrolled growth, with many secondary markets working as a speculative scheme. According to the research, many collectibles circulating on secondary markets are “low-quality,” and the marketplaces might quickly collapse once regulatory monitoring is clear.
It’s worth emphasizing that, unlike NFTs, digital collectibles in China are not linked to cryptocurrencies. Instead, the country prefers to deal with the situation on its terms.
Despite its tough stance against bitcoin and other tokens, the country has strongly desired to learn more about the blockchain technology that underpins cryptocurrency. As a result, the country’s Blockchain Service Network (BSN) earlier this year, plans to establish a new infrastructure that would allow users to deploy non-fungible tokens.
Individuals and businesses tried to participate with digital collectibles cautiously due to a lack of governmental oversight, especially because the country’s awesome app WeChat suspended multiple accounts associated with trading digital collectibles on the site. In addition, the Tencent-owned app-only enabled users to display valuables such as digital presents or artwork, with no trading allowed.
The Approaches of Tech Giants
Many tech firms stopped using the term “NFTs” when characterizing such digital assets after Chinese regulators advised against buying collectibles for speculative purposes.
Ant Group, a subsidiary of Alibaba, and Tencent Holdings have marketed their listed NFTs as “digital collectibles,” with both companies offering them on private blockchains. They’re also priced in Yuan, the country’s legal cash, rather than any cryptocurrency.
In addition, Alibaba Cloud has recently announced additional services for non-Chinese NFT platforms. Given that NFTs are still illegal in the country, the company announced the news on Twitter on June 8th but quickly removed it from its page. However, there is no evidence that such a decision was prompted by direct Chinese government pressure.