China’s WeChat messaging service disables accounts linked to ‘speculation’ and secondary sales of NFTs amidst regulatory crackdown
China’s Tencent confirmed it has suspended a number of WeChat accounts associated with non-fungible tokens (NFTs), amidst a tightening of regulations in the country’s digital sector.
The company said its move was intended to curb “speculation” in the digital assets.
NFTs have become popular in recent months, with some selling for millions of dollars.
They often represent artworks and are considered a form of collectible, although one without a physical form.
NFTs are not directly regulated in China, but are required to operate on a regulated blockchain.
In other countries NFTs typically run on the blockchain of the Ethereum digital currency, but digital currencies such as Ethereum and Bitcoin are banned in China.
Chinese residents are required to pay for NFTs in the country’s yuan currency.
They can buy NFTs from a marketplace, but secondary trading is heavily restricted.
In a post on its official account on the WeChat messaging service, Tencent’s WeChat said it had “recently standardised and rectified public accounts and mini programs (MPs) for speculation and secondary sales of digital collections”.
The post came in response to a local report that accounts linked to NFTs had been suspended “on a large scale”.
The move was made “according to relevant national regulations, in order to prevent the risk of speculation in virtual currency transactions”, WeChat said.
Parent company Tencent declined to offer further comment.
China’s tech industry has faced severe curbs in recent months as regulators looks to rein in the country’s digital giants.