China NFT Weekly: Will NFTs Be Regulated in China?
Digestible news about the latest developments across the fields of NFT, blockchain and metaverse in China, delivered to you every Thursday.
This week: PBoC anti-money laundering chief speaks out against NFTs and metaverse, China looks to set up digital asset bourse to push e-CNY and boost financial services in the capital, Decentraland sells virtual plot of real estate for record $2.4 million, and more.
Chinese Media Company 36Kr Releases 1,124 Metaverse-Themed Digital Collectibles
Media firm 36Kr Holdings and Magic Nucleus, Tencent‘s NFT trading software developer, jointly launched 1,124 metaverse-themed digital collectibles at a conference in Shenzhen last week.
- According to 36Kr‘s press release, the metaverse-themed digital collectibles were gifted as souvenirs to those attending the conference in person and online. The collectibles cannot be transacted, nor do they have investment attributes.
- This is the latest sign of growing interest in digital assets despite the government’s previous bans on cryptocurrency trading and mining.
- 36Kr CEO Feng Dagang is positive that in the next two decades, China will see tremendous growth in the metaverse and affiliated industries, because relevant technologies and use cases will soon be in place. (36 Kr, SCMP)
PBoC Warns That NFTs and Metaverse Could Be Money Laundering Tools
The People’s Bank of China’s (PBoC) anti-money laundering chief, Gou Wenjun, has also spoken out about NFT and metaverse projects, suggesting that there may be a need to regulate these sectors in the same manner as it polices cryptoassets.
- Gou Wenjun says that similar to cryptocurrencies, NFTs and metaverse have a degree of interoperability, and can be easily used as money laundering tools for criminals.
- The bank and other government organs have also squashed the nascent Chinese NFT industry, forcing tech giants who had planned to issue large collections onto private blockchains and imposing tight restrictions on NFT trading to “reduce speculative hype.”
- Now it appears the nation has turned its attention to metaverse activities – and has resolved to ensure Chinese projects do not end up straying onto networks such as Ethereum (ETH).
- Earlier, People’s Daily, the official newspaper of the Chinese Communist Party, also spoke out against recent investment fever around NFTs, warning that this could be another “zero-sum game hyped by cryptocurrency investors and capital.”
- China’s incoming strict regulation comes at a time when NFTs and metaverse gain traction, and Google searches for NFTs are at an all-time high. (Crypto News, SCMP)
China Looks to Set Up Digital Asset Bourse to Push e-CNY
China is considering setting up a digital asset exchange in Beijing as officials push to promote usage of the digital yuan and crack down on cryptocurrencies.
- Beijing will explore the possibility of establishing a bourse for digital assets trading, as part of broader efforts to boost financial services in the capital, according to guidelines issued by the State Council.
- The idea is among a wide range of developmental plans for the Beijing municipal administrative centre, an area situated in the north of Beijing which has been carved out as a key plank of the capital’s development up to 2035.
- The cabinet called for faster trials of the digital yuan and urged big banks to set up e-CNY operation firms. The statement provided no further details on the planned digital asset exchange.
- China has been in the process of creating a virtual version of its legal tender since 2014 in an effort to cope with an increasingly digitized economy as well as to fend off potential threats from virtual currencies such as Bitcoin.
- Trials were carried out in multiple cities last year to promote use of the e-CNY among consumers and merchants. A broader roll-out of the digital currency is expected in Beijing when it hosts the Winter Olympics in February. (Bloomberg, State Council)
SEE ALSO: Tencent Responds to NFT Name Change, Resists Illegal Cryptocurrency Activities
NFTs on China’s BSN Migrate to OpenSea to Tap Global Market
NFT featuring famous traditional Chinese paintings have been successfully transferred from China’s Blockchain-based Service Network (BSN) WenChang Chain to the OpenSea marketplace on the Ethereum blockchain, a milestone in the development of interchain NFT technology.
- The transfer was made across four blockchains, including the permissioned (a mix between public and private blockchains; supports many customization options) WenChang Chain and the permissionless chains IRIS Hub (IRISnet) and Ethereum.
- The successful cross-chain transfer opens up diverse possibilities for global commerce involving different jurisdictions, according to an IRISnet blog post. “BSN OPB supports Chinese artworks’ registration and domestic commerce, and, for global commerce, interchain technology allows these artworks to circulate to public chain-based global markets with trustworthy data.” (Forkast)
Decentraland Sells Plot of Virtual Real Estate for Record $2.4 Million
A patch of virtual real estate in the online world Decentraland sold for a record $2.4 million, according to Decentraland and buyer crypto investor Tokens.com.
- Decentraland is a decentralized 3D virtual environment or metaverse consisting of 90,601 parcels of land, which are sold as NFTs and can be bought by the Ethereum-powered crytocurrency MANA.
- A subsidiary of Tokens.com, called the Metaverse Group, bought a patch of real estate for 618,000 MANA on Monday, which was around $2,428,740 at the time. According to Decentraland, this was the most expensive purchase of a plot of virtual real estate on the platform.
- The land is in the “Fashion Street” area of Decentraland’s map and would be used to host digital fashion events and sell virtual clothing for avatars.
- It is made of 116 smaller parcels, measuring 52.5 square feet each, making the land 6,090 virtual square feet in size.
- Andrew Kiguel, CEO of Tokens.com, said the assets would complement the real estate already held by Metaverse Group.
- MANA is highly volatile. It has gained around 400% this month according to Coinbase, spiking after Facebook’s name change. (Reuters)
DALL-E is an artificial intelligence program that can interpret natural language inputs (natural language is any language that humans have developed naturally through repetition instead of conscious planning. It is distinguished from formal language, an example of which would be programming language used to communicate with computers) and generate corresponding images. It can create images of realistic objects as well as objects that do not exist in reality.
The name DALL-E is a portmanteau (a word formed by combining parts of other words) of WALL-E and the late Spanish painter Salvador Dalí.
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 email@example.com. See you again next week!