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Chinese tech giant Tencent shuts down NFT platform amid trading restrictions – Bitcoin News
China’s Tencent Holdings plans to shut down its non-fungible token (NFT) platform Huanhe just a year after its launch. The social media giant reportedly made the decision due to the strict ban on the resale of NFTs imposed by the Beijing authorities.
Huanhe shuts down a year after launch as China slows resale of NFTs
Shenzhen-headquartered tech conglomerate Tencent is preparing to shut down its NFT platform as early as this week, according to a report by Chinese media outlet Jiemian, cited by the South China Morning Post. The move comes amid restrictions on secondary trading of NFTs in the People’s Republic that are said to have damaged the platform’s business potential.
Jiemian cites unidentified sources from Tencent, but the company has declined to make an official comment on the matter. Huanhe, which issues and distributes blockchain-based digital collectibles, was launched just a year ago.
All NFTs on the app are already marked as “sold out”, although users can still visit augmented reality art exhibitions. Another report citing another Tencent source, from state-owned media outlet Yicai Global, reveals that trading halted in early July pending a breakdown.
Huanhe was developed by Tencent’s Platform and Content Group (PCG), which was hit hard by layoffs earlier this year. If the NFT unit ceases operations, it would mark a major retreat for Tencent from the digital collectibles market, SCMP notes.
In June, Tencent’s social media app Wechat announced its intentions to ban public accounts that facilitate secondary trading or offer guidance for non-fungible tokens. A little later, the Tencent News app stopped selling NFTs.
Other Chinese tech giants, such as Alibaba Group Holding, have been cautious about their involvement in NFTs, with Chinese platforms typically replacing the NFT label with the term “digital collectibles,” which are not necessarily associated with cryptocurrencies.
The mainland government has gone after crypto-related activities, including investment, trading and mining. It has highlighted concerns that speculation could lead to bubbles in the digital asset market, while promoting the state-issued digital yuan. According to existing regulations, tokens can only be purchased with Chinese fiat and never resold.
Do you expect other NFT platforms in China to shut down in the near future? Tell us in the comments section below.
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