According to the South China Morning Post published on the 4th of July 2022, Chinese tech corporations signed an agreement that those involved in NFT trading will have to show their IDs before making purchases to prevent secondary marketplaces.
Although the agreement is not legally binding the China Cultural Industry Association published it.
Several Chinese Tech Corporations Now Require ID for Buying NFT
Giant Chinese tech corporations such as Tencent, Baidu, JD.com, Ant Group, and others signed a “self-disciplined proposal” to identify users in digital collectible organizations.
Thus, Non Fungible Tokens (NFTs) trading will require the real-name authentication of those involved in the buying and selling processes.
This complies with China’s ban on cryptocurrency use. And it also says that the sale of digital collectibles (NFTs ) will “only support legal tender as denomination and settlement currency”. Platforms involved in the sale of digital collectibles will also need to have regulatory certificates in their possession. Furthermore, they will also make sure the blockchain platforms are secure.
According to the China Cultural Industry Association, Domestic digital Collections are part of digital cultural creativity. And are distinct from foreign platforms that make use of NFT technology as their financial products.
NFTs in China
In 2021, the Chinese government banned transactions of cryptocurrencies and also made those involved in Bitcoin mining operations relocate. However, the ban did not extend to NFTs space. Because following this, China launched a cryptoless digital collectible platform.
Furthermore, Giant tech corporations such as Tencent, Baidu, and Ant Group have launched their digital collectibles. And buyers can only purchase these collectibles with the Chinese yuan.
NFTs have gained a wide range of popularity in China as platforms involved in the sale of digital collectibles have increased in only four months, from February to June 2022, by five times even with the consistent warnings by the government.
During the COVID lockdown, there were over 100 NFT collections listed on the Opensea marketplace from those living in Shanghai.