WeChat, a Tencent service, has blocked several accounts linked to so-called non-fungible tokens (NFTs) and clarified the laws surrounding these digital collectibles.
NFTs are digital tokens similar to artwork that have become more popular, with some selling for millions of dollars. They’re frequently built on a blockchain platform, such as Ethereum, with consumers paying in cryptocurrencies for the tokens.
China, on the other hand, has taken a hard line on digital currencies, prohibiting their trading within the country. In China, NFTs are not purchased with cryptocurrency. People instead use the Chinese yuan to pay. They’re also not based on a distributed ledger like Ethereum. Instead, they are based on other blockchains that are supervised by regulators.
NFTs, on the other hand, are not yet regulated in the country. These digital collectibles are available for purchase on a marketplace, but secondary trading is severely restricted. Because NFTs are speculative, technology companies are treading carefully in order to avoid falling foul of any forthcoming regulations.
Tencent announced that it had “rectified” public accounts on WeChat in order to reduce the risk of digital currency speculation.
The suspension of accounts was not confirmed by a Tencent official. However, WeChat’s official account on Weibo, a Twitter-like service, responded on Wednesday to a post by local media claiming the accounts had been suspended.
On its platform, it clarified the restrictions regarding NFT accounts. Tencent-verified accounts can showcase digital collectibles but not sell them on the secondary market. They must present a certificate from China’s cyberspace regulator proving that they are registered and allowed.
WeChat mini programmes, according to Tencent, can only show NFTs. Mini applications are lightweight versions of apps that operate within WeChat.