China NFT Weekly: Virtual Meetings Reimagined
Digestible news on the latest developments across the fields of NFTs, blockchain, and metaverse in Greater China, compiled for you every week by Pandaily.
This week: China’s Communist Youth League launches NFTs, crypto mining rig maker Canaan added to SEC list of scrutinized Chinese companies, Regal Hotels to launch virtual conference center in the metaverse, and more.
China’s Communist Youth League Lauches NFTs
China’s Communist Youth League has launched 54,000 free NFTs on May 4, known in China as Youth Day, a holiday established in 1919 to commemorate anti-imperialist student movements in Beijing. SCMP first reported the story on Thursday.
- The organization labelled the NFTs as “digital collectibles,” as China has officially banned crypto since last September.
- The collection featured the league’s official mascot “Tuanbao,” an anime-inspired cartoon figure with two communist stars on its head. The NFTs were built on a blockchain developed by Hangzhou Shunwang Technology, and sold out within an hour after their release.
- Like other digital collectibles, the Communist Youth League NFTs cannot be sold or traded.
- China’s Youth Day is celebrated annually on May 4 to commemorate student demonstrations in 1919 against the Treaty of Versailles, which transferred the ownership of a Chinese territory from Germany to Japan.
- Separately, Peking University, one of the most prestigious universities in the country, issued 20,000 digital collectibles in the form of alumni cards to commemorate Youth Day and the school’s 124th anniversary. (SCMP)
Crypto Mining Rig Maker Canaan Added to SEC List of Scrutinized Chinese Companies
Chinese crypto mining rig maker Canaan said on Thursday that it has come under the scrutiny of the United States Securities and Exchange Commission (SEC) due to its apparent ties to Beijing, reported CoinDesk.
- According to the SEC, Canaan was added to the list because it used an auditor for its 2021 annual report that the US Public Company Accounting Oversight Board (PCAOB) could not fully investigate. The said auditor was KPMG Huazhen LLP.
- The Holding Foreign Companies Accountable Act (HFCAA) passed in 2020 as a law that requires companies publicly listed on stock exchanges in the United States to declare they are not owned or controlled by any foreign government.
- Canaan has until May 25 to file documentation with the SEC to prove that it is not “owned or controlled” by a foreign government. If Canaan were to remain as an “identified” issuer for three consecutive years, it risks being delisted from the US markets, including over-the-counter trading. China-linked crypto stocks fell by as much as 10% on the heels of the announcement.
- Canaan is now one of over 80 companies on the watchlist, which includes China’s JD.com, Trip.com, Pinduoduo, Bilibili, NetEase, and Sinovac Biotech.
- Sources told Reuters last month that Chinese regulators had asked some of the country’s US-listed firms, including Alibaba, Baidu, and JD.com, to prepare more audit disclosures. (CoinDesk, CNBC)
READ MORE: The SEC’s List of Scrutinized Chinese Companies
Regal Hotels to Launch Virtual Conference Center in the Metaverse
Regal Hotels announced plans to launch a virtual conference center in The Sandbox, a metaverse platform owned by Hong Kong-based gaming software and venture capital firm Animoca Brands, reported SCMP.
- As one of the first listed hotel groups in the city to make its foray into the metaverse, Regal Hotels sees opportunities in building blockchain-based virtual conference centers.
- “The format of corporate meetings and conferences will not be either online or offline, but will take on a hybrid model whereby it will also enable participants to continue with their networking,” said Poman Lo, Vice President and Managing Director of Regal Hotels. “The metaverse has made it possible to engage attendees in ways that are not yet available on [existing] video conference platforms.”
- The virtual conference center will host large-scale industry events that can be livestreamed to attendees, who also have the option to meet their potential business partners as avatars.
- Regal Hotels’ move follows a series of explorations of the virtual conference format by tech giants, including Baidu, which hosted a three-day virtual conference for AI developers in its metaverse app “Xirang,” and NetEase, which livestreamed the listing of its music streaming platform on the Hong Kong Stock Exchange in its own metaverse “Yaotai.”
- Virtual conferences used to be one of the most important revenue streams for the hospitality industry. However, due to the COVID-19 pandemic, many offline meetings were cancelled or moved online. The video conferencing market is estimated to grow to $6.9 billion this year, according to market research firm Fortune Business Insights.
- Regal Hotels also plans to sell up to 100 hotel and residential units in the form of NFTs to the city’s young people, who live in one of the least affordable housing markets of the world. (SCMP)
READ MORE: HSBC Joins Metaverse Race Through Partnership With The Sandbox
Hong Kong Exchange to Include Crypto ETF by Samsung Asset Management
Samsung Asset Management plans to list a blockchain exchange-traded fund (ETF) on the Hong Kong Stock Exchange in the first half of this year, the Korea Economic Daily reported on Thursday.
- The new ETF, tracking cryptocurrencies and blockchain tech companies, will be the first of its kind to list in Asia.
- The annoucement of the plan follows the asset manager’s acquisition in late March of a 20% stake in the US ETF sponsor Amplify Holding Company LLC, known for its ETF products such as the Amplify Transformational Data Sharing ETF, which invests at least 80% of its net assets in blockchain-related companies.
- The new ETF tracks a list of crypto-related companies, including crypto payment platform Silvergate Capital, crypto mining graphics processing unit (GPU) producer Nvidia, digital asset manager Galaxy Digital Holdings, crypto exchange platform giant Coinbase Global, and derivatives exchange Chicago Mercantile Exchange (CME) Group.
- To date, Samsung Asset Management has launched five ETFs, which track global semiconductors, US big tech (Facebook, Apple, Amazon, Netflix, Google, etc.), Asia-Pacific REITs, Chinese tech companies, and crude oil. (The Block Crypto, The Korea Economic Daily)
Starbucks to Launch NFTs by End of This Year
Starbucks told investors during its Q2 2022 earnings presentation that it plans to enter the Web3 space with the launch of an NFT collection later this year, which will provide owners with access to exclusive content experiences and other benefits, reported TechCrunch and The Verge, citing Starbucks CEO Howard Schultz and Executive Vice President and Chief Marketing Officer Brady Brewer.
- The executives said the company will add “new concepts such as ownership and community-based membership models that we see developing in the Web 3 space.” Brewer went further and said: “Imagine acquiring a new digital collectible from Starbucks, where that product also serves as your access pass to a global Starbucks community, one with engaging content experiences and collaboration all centered around coffee.”
- In addition to just NFTs, the company alluded to a full-fledged “Starbucks Digital Community Web3 platform” possibly tied to mobile in-store payments.
- The Starbucks app is currently the second most used form of mobile payment in the US, only behind Apple Pay, with over 30 million active users.
- Ahead of the NFT launch, Starbucks brought in Adam Brotman, the architect of its Mobile Order & Pay system and the Starbucks app, to help serve as a special advisor for the project.
- The company is also looking for a new CEO who understands the potential of Web 3 technologies, according to current interim CEO Howard Schultz. The longtime executive has returned to head the coffee chain – which is now undergoing a unionization push – following the departure of Kevin Johnson, who had served as CEO since 2017.
- The coffee giant narrowly topped its Q2 revenue forecasts, with a total of $7.64 billion versus $7.6 billion expected and earnings per share of 59 cents adjusted, in line with expectations, despite losses in China due to new COVID-19 lockdowns. (The Verge, Tech Crunch, CoinDesk)
NFT Market Likely to Grow 35% Into a $13.6B Industry by 2027
New research predicts that the $3 billion NFT market will reach $13.6 billion by the end of 2027, reported Cointelegraph.
- For the next five years, the key factors tied to the global NFT boom continue to factor in the growing involvement of mainstream influencers, gaming communities and the rising demand for digital artworks.
- Research firm MarketsandMarkets added several other factors contributing to the growth of the NFT market, including its increasing use cases in supply chain management, retail and fashion.
- Market leaders such as Meta will also help to speed up the development of the segment.
- Other indicators of NFTs growth potential include the increasing number of Google searches around the topic, especially among APAC investors. Cointelegraph said one of the key factors causing the rise in NFT searches in places like Hong Kong, Singapore and mainland China is the lack of regulatory clarity around crypto trading and mining.
- NFT marketplaces will claim the lion’s share in the growth of the segment. Market leaders like OpenSea now face increasing competition from crypto exchanges like Coinbase and Binance, which have started offering similar services for minting, selling, and trading NFTs. (Cointelegraph)
That’s it for this week’s newsletter – thanks for reading! As always, I welcome any feedback on how to make this newsletter better. My email is firstname.lastname@example.org. See you again next week!