Popular Chinese Messaging Platform WeChat Prohibits Accounts Dealing in NFT, Crypto Services

There has been a massive rise in services offering digital collectibles in China in 2022 alone.

By Shomik Sen Bhattacharjee | Updated: 24 June 2022 15:30 IST

Popular Chinese Messaging Platform WeChat Prohibits Accounts Dealing in NFT, Crypto Services

Photo Credit: Reuters

WeChat has moved to ban all accounts that provide access to crypto or NFT-related services

Highlights

WeChat included the Digital Yuan as a payments option in April
The changes arrive as a follow up to guidelines issued in early 2022
WeChat's plaforms have more than a billion users

After a public crackdown by the Chinese government on anything that has to do with cryptocurrency, one of China's most popular instant messaging and calling apps in WeChat has now banned crypto-related accounts on its platform. As suggested by reports, accounts that issue, trade, and finance crypto and non-fungible tokens (NFTs) will be restricted under the new rules and will be classified as ‘illegal business'. Section 3.24 in the updated WeChat "Code of Conduct" declares that any account involved in the issuance, trading, or financing of digital currency will face consequences, with the possibility of a permanent ban.

As per a statement provided to the South China Morning Post, Tencent said it will "order accounts to rectify if they provide relevant services or content for secondary trading of digital collectibles, and limit some features or even ban the account." The news comes after in April, WeChat acknowledged it had suspended some accounts linked to NFTs.

The policy update will also introduce penalties for accounts providing transaction channels, guidance, or issuing cryptocurrencies to WeChat users. Accounts enabling initial coin offerings (ICOs) and transactions of crypto derivatives will also be affected.

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WeChat with more than 1.1 billion daily active users in China, has updated its rules: WeChat public accounts which involved in the issuance, trading and financing of crypto and NFTs will be limited function or banned. https://t.co/0I9oMrvFTp pic.twitter.com/mzclYjFZNg
— Wu Blockchain (@WuBlockchain) June 20, 2022

The report notes that with the move, WeChat's management is taking into account the guidelines issued by Chinese regulators earlier this year suggesting that businesses in the industry should steer clear of the financial aspect of such digital assets.

Although NFTs were largely left alone by Chinese regulatory bodies in the past, a recent report by China Times (via CryptoPotato) indicates that the amount of such platforms in the country has grown from about 100 to over 500 in 2022 alone.

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Interestingly, in April, WeChat had incorporated the Chinese government's Central Bank Digital Currency project ‘digital yuan' in its payment options. However, the recent amendments made in the policy do project China's strict monitoring of crypto or rather decentralisation.

Tencent's stance therefore clears the way for its platforms – which have more than a billion users – to serve as a platform for China's very traceable digital cash, but not to host content about alternatives.

Will crypto tax hurt the industry in India? We discuss this on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.

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