When the NFT bubble bursts, the local news publication, acting as the party’s spokesperson, warns of a significant reduction in the value of the party’s assets.
The Chinese government has issued a series of remarks criticizing the value of the non-fungible token (or NFT) market, despite the fact that the technology is being pursued by two of the country’s largest technology companies, according to local sources.
The Securities Times, a news publication service functioning as a spokesperson for the official Chinese Communist Party newspaper People’s Daily, was the first to break the story, which was then picked up by the South Morning China Post and reported on by the South Morning China Post.
Specifically, the remarks stated that “it is common sense that there is a huge bubble in NFT transactions,” and that most NFT buyers, when purchasing with a financial motivation, are simply concerned with the value of the assets, rather than appreciating the visual aspects of the item.
Wang Junhui, a staff reporter for the SMCP, writes the following:
“Once market enthusiasm wanes and the hype cools, the value of these many strange NFTs will greatly decrease.”
A People’s Daily editorial in June claimed that the NFT market “can be hyped up, resulting in chaos,” and that “decentralization” could result in “security concerns.”
Chinese authorities dealt a crushing blow to cryptocurrency mining companies earlier this year as part of a deliberate effort to drive unfavored activities from the country’s borders.
Tencent Holdings and Alibaba Group Holdings, the country’s two largest technology companies, have made significant strides in their NFT-focused research and development efforts and are now active participants in the area.
Tencent launched its NFT trading platform, Huanhe, last month with the goal of integrating NFT assets into its music streaming platform, QQ Music, in the near future.
Similarly, Ant Group, Alibaba’s fintech partner, has recently put two NFT photos for sale within its wallet application Alipay, which is owned by Alibaba.
Despite this, proponents of NFT in China continue to be restricted in their trading activities. For example, only the Renminbi, the country’s official currency, can be used for financial transactions. Furthermore, once purchased, NFTs cannot be resold because doing so would constitute a violation of the country’s financial regulations.
