China’s CCP Intends to Regulate NFT Collections

China Economic Daily, a communication arm of China’s Communist Party, says that China will look towards regulating “digital collections,” also known as NFTs.

According to the Wednesday report, the country’s decision to regulate digital collectibles occurs due to their speculative characteristics. The move to crack down on virtual collectibles, China Economic Daily says, would include multiple sectors of the nation’s economy.

The CCP issued an argument yesterday against considering virtual collectibles as merely artistic and cultural collectibles. Therefore, the government’s existing regulation of NFTs under different departments on intellectual property isn’t sufficient.

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Speaking further on the report, China Economic Daily affirms that different large digital companies have created various methods of inciting celebrities and NFT creators to invent their digital collectibles.

The daily argues such platforms place consumers at risk due to the fragile pricing system of virtual collectibles. Additionally, the immense liability of speculation that borders around NFTs is another factor that reduces their reliability.

Being an off-shoot of financial services technology, China maintains that NFTs need stricter controls within its national borders. The country’s WeChat messenger application recently suspended certain accounts connected to NFTs to crack down on secondary deals.

The CCP’s Increasing Crackdown on Non-Fugitible Tokens

The Chinese government has continued to warn its citizenry against participating in any speculative merchandise, e.g., through digital collections. This increasing supervision and warnings increase the pressure on creators and owners of non-fugitible tokens.

Also, the CCP’s official press organization has informed its citizenry to be wary of owning digital collectibles. The report advises that Chinese residents waited until the country had a regulatory structure.

Indicators show that the CCP might soon set up a regulation against NFTs as it did with cryptocurrencies. The crypto world awaits China’s future move in line with its past crackdowns on digital assets.

Banning all Cryptocurrencies

China declared all activities relating to cryptocurrencies in 2021, as the country’s central bank tagged them as being “seriously” risky. The declarations came when China stood as one of the world’s biggest digital currency markets.

The 2021 ban on cryptocurrency in China follows the country’s earlier partial outlawing of crypto assets in 2019. The 2019 announcement hadn’t included online crypto transactions. Consequently, online transactions in digital assets continued in China until the 2021 announcement.

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However, the ban on digital currencies in China would inevitably affect the global cryptocurrency market. For instance, when the country issued a regulation outlawing digital assets in 2021, the price of Bitcoin fell by over $2,000.

Additionally, these bans imply that the global mining industry would see intensive migration from the Asian nation, renowned for cheap electricity. China had been a hot spot for mining activities, which depend on a series of different computers connected to a ledger termed a blockchain.

Bitcoin mining had become so famous in China that many game lovers accused the mining industry of the global scarcity of graphic cards. Such graphic cards, which find application in developing games, were then converted into the processing of digital currencies.

While digital assets have yet to overcome the challenge of instability, several other countries are gradually embracing cryptocurrencies.