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The Chinese government-aligned newspaper Guangming Daily published an opinion article to criticize non-fungible token (NFT) hype, which is “definitely not good for the healthy development of NFT.”
Fast facts
- The article cited Gartner, a global technology research company, and its report Hype cycle for emerging technology, indicating that NFTs are at a high point of hype. The article said, “At this moment, all the excessive boasting and exaggeration of the NFT function, as well as the profit-making behaviors that take the opportunity, will have a very unfavorable impact on the development of NFT.”
- The article suggests that for NFTs to be stable and far-reaching, companies must be “practical and work hard to explore the application of NFT in practice” and “remain humble and cautious, and resolutely reject all kinds of speculation and hype related to NFT.”
- While NFTs remain legal in China, they hold a tenuous place amid the Chinese government’s tough regulatory stance on digital assets. For example, Alibaba and Tencent have their own NFT platforms, but they do not support the private buying and selling of NFTs among users because they are worried the government will raise objections.
- The article praised AntChain’s stance on NFT hype. AntChain is a blockchain ecosystem that belongs to Chinese tech giant Alibaba.
- The article referred to a case in September, when AntChain launched an NFT called Asian Games Digital Torch and priced it at 39 yuan (US$6.06), promoting the Asian Games to be held in Hangzhou in September 2022. A person who owns the NFT auctioned it on the online platform Ali Auction, a platform belonging to Alibaba, and the bid price rose to 3.149 million yuan (about US$489,013).
- AntChain and Alibaba quickly removed the NFT from the auction platform. Antchain stated, “We firmly oppose all forms of digital collection hype, and resolutely resist any form of illegal activities in the name of digital collection, which are actually virtual currency-related activities.”
- Guangming Daily is not the first government-aligned mouthpiece to criticize NFTs. In September, media outlets Beijing Business Today and Securities Times published critical articles.
- Last month, the Chinese central bank and other 10 government departments issued a further detailed regulation to crack down on cryptocurrencies, prompting more than 30 crypto-related companies to withdraw from the Chinese market. Although the Chinese government has not yet defined NFTs as a virtual currency, China’s major technology giants are still cautious about launching NFTs since it is a kind of virtual asset.