Ban on NFTs and Cryptocurrency Marketplaces 

 As reported by the South China Morning Post, Tencent and Ant Group have joined a self-driven industry initiative to ban cryptocurrency and combat speculation. The report further states that platforms selling digital collectibles “shall require real-name authentication of those who issue, sell and buy” the assets and “only support legal tender as the denomination and settlement currency”, according to the document signed by China’s biggest tech firms.  

 Moreover, China’s non-fungible token (NFT) industry has published a “self-discipline initiative”. The initiative promises identity checks for users, adherence to the country’s ban on cryptocurrencies, and a promise not to establish secondary marketplaces to fight speculation. The 14-article document endorsed by many of the biggest tech firms in China says:   

 “China’s NFT Platforms that sell digital collectibles, the term used in mainland China for NFTs that cannot be traded using cryptocurrency, shall require real-name authentication of those who issue, sell and buy the assets and only support legal tender as the denomination and settlement currency.”  

Citations of the ‘Self Discipline Initiative’  

The document is an effort from private companies that is not legally binding. It was published by the China Cultural Industry Association the previous week. Various companies involved in China’s digital collectibles market have signed the initiative. The major names are Tencent Holdings, Baidu, JD.com, and Ant Group, the fintech affiliate of Alibaba Group Holding, owner of the South China Morning Post.  

Moreover, the agreement calls on signatories to firmly resist speculation in the market. It also reads: “Do not contain financial assets or unlicensed financial products, including securities, insurance, credit, and precious metals, in blockchain-supported goods.” The document also said digital collectible platforms should have relevant certifications, including those required for blockchain service providers, internet culture operators, and telecom business operators.  

Leaders’ Opinion of the Initiative 

According to Luo Jun, secretary-general of the metaverse committee of the China Computer Industry Association, “the initiative recognizes NFT technology’s use in intellectual property protection and cultural product registration.” However, according to him, as cryptocurrency is banned in China, there is a need for further regulation to curb financial risks. Luo further stated that the initiative was formed by the industrial association and multiple market operators “which do not represent the government’s stance”.  

According to the CEO of blockchain developer Red Date Technology He Yifan, the document is an industry-level initiative in response to an earlier one published by major financial industry associations to curb risks associated with digital assets. Red Date Technology provides technical support to China’s Blockchain Service Network.  

China’s Prohibition on Use of NFTs 

In April 2022, the National Internet Finance Association of China, China Banking Association, and the Securities Association of China issued a joint statement to prohibit the use of NFTs in the issuance of financial assets such as securities, insurance, loans, and precious metals. Yifan added that the key is to prevent the financialization of digital collectibles.   

Although the Chinese government restricts NFTs, domestic companies have embraced the new business. Ant and Tencent were the first Chinese tech giants to launch digital collectible platforms. JD.com followed with its own platform, and Baidu has issued its own digital collectibles.  

Major domestic platforms have similar requirements: users require identity checks and owners are not permitted to resell the items for profit. A digital collectible can be transferred as a gift after the owner has held it for a specific period. The new initiative does not mention the resale of the NFTs but calls on companies not to set up a centralized marketplace for bidding, matching, or anonymous trading. However, experts say that private transactions cannot be banned.  

Anwesha Mishra

Anwesha has been a creative writer for a while. Currently, on her pursuit of tech writing, she is diving into the realms of technology to produce better content on the forever-changing world of technology. In her free time, you’ll find her humming tunes of her favourite shows or reading a book.

The post Chinese tech firms pledge to ban NFTs, cryptocurrency marketplaces appeared first on Tech Research Online.

Let’s discuss more on non-fungible tokens and some Top NFT Marketplaces you can consider. 

What are NFTs?

NFT means non-fungible tokens these are non-interchangeable units of data stored in the blockchain. NFTs are digital assets like art/Images, Videos, Collectibles, in-game items, and music that can be bought and sold online, frequently with cryptocurrency.

Imagine you’re an artist and you want to sell your digital artwork online. To do this you need to find some way of marking and tracking ownership of your artwork to prove its originality. That’s where you can use NFT Marketplaces to create and trade your artwork online.

Cryptocurrency and NFTs are different from each other except for the fact that they have is both built using the same kind of blockchain technology. Every cryptocurrency has the same value, for example, one Ethereum is always equal to another Ethereum. Whereas NFT is non-fungible /exchangeable which means one NFT has a Different value from the other.

Understanding NFTs Marketplaces

NFT Marketplace is the virtual economy platform where you can create and trade these non-fungible tokens. The marketplace is the platform where you can buy and sell your artwork. It is similar to that online shop where you can buy with your digital wallet.

Top 8 NFT Marketplaces to Trade in 2022-23

1. OpenSea

OpenSea is the most popular and growing NFT marketplace founded in 2017. Most of NFT on OpenSea exists on the Ethereum blockchain and it also supports other blockchains like Polygon and anKlatyn. It provides a simple and secure trading experience for its user. OpenSea offers 2M+ Collections with 80M+ NFTs on their platform. It also has assets including ERC115 and ERC721. You can also explore other digital assets, including Decentraland, CryptoKitties,  ENS games, Axies,  etc.  It is the most popular and best-known marketplace. celebrities like Logan Paul, mark Cuban, and many others have also Used this platform.

2. Rarible

Rarible is another big NFT Marketplace just like OpenSea. This platform was Launched in 2020 with its own ERC-20 governance token RARI. This platform mostly focuses on users who wish to trade digital artworks.  Rarible has two tokens, ERC-1155 and ERC-721. It exists on the Ethereum blockchain network and supports wallets like Fortmatic, Coinbase Wallet, MyEtherWallet, MetaMask, and WalletConnect. Rarible charges Gas fees + 2.5% marketplace fee and It does not support Split Payment. 

3. Nifty Gateway Rarible

Nifty Gateway Rarible is an NFT marketplace based on the Ethereum blockchain network founded in 2018. Every three weeks, they release special collections of artwork from top artists like Grimes and LOGIK using drops that are accessible only for a limited period. Nifty Gateway is basically focused on Crypto art, Music, Photography, Fixed price auctions, etc. and it does not support Smart Contract Import. Nifty Gateway Rariblec charges a 20% fee plus 30 Cents from each secondary sale and it only supports Fiat Wallet.

4. Foundation

Foundation is the Ethereum (ETH) Blockchain platform that aims to unite artists,  collectors, and curators. Foundation is not just an easy way to start creating your own NFTs but one of the best platforms you can go for. Foundation was launched in February 2021. It has sold more than $180+ million of NFTs till now.  Foundation has two tokens, Proprietary and ERC-721s and it supports the Proprietary and ERC-721s Wallet. Foundation also charges Gas fees + an additional 15% marketplace fee and supports Collaboration/Split Payment. 

5. KnownOrigin

KnownOrigin is an Ethereum (ETH) blockchain NFt marketplace where you can find and purchase rare digital crypto artworks. Every artwork on KnownOrigin is truly unique and authentic. It focuses on the NFT market of Art, Games, Sports, etc. It also has assets ERC-721 and it also supports wallets like Fortmatic, MetaMask, and Portis. KnownOrigin also charges Gas fees + a 15% marketplace fee and it does not support Split Payment. If you are a Rear artwork collector this platform is perfect for you.

 6. Axie Infinity 

Axie Infinity is the second-largest NFT marketplace hosted by the video game Axie Infinity. You can play games and buy characters, train them and play against other players’ characters to earn rewards. It is an anime world-based game like pokemon. On Axie Infinity Marketplace, players can buy new characters called Axies and lands and many other items, as NFTs to use in-game. Axie Shards(NFTs) are built on the Ethereum blockchain.

7. MakersPlace 

MakersPlace Makersplace is an NFT site that exists on Ethereum (ETH) blockchain. It was founded in 2019. MakersPlace provides its collectors with efficient tools to protect and sell their work to collectors and fans. The best thing about MakersPlace is it provides  Fixed price auctions on its platform. In addition, they also offer 10% royalty as commission on every re-sold artwork. It also supports Split Payment and wallets like Portis, Fortmatic, MetaMask, and WalletConnect.

8. SuperRare

As its name, you can buy and sell single edition artworks on this NFT platform. The best part of treading on SuperRare is that it provides a record of ownership of all digital collectibles to maintain the transparency of trade. It has done $86+M in secondary sales so far with a 5,324% average resale value.

Why are NFTs so Popular?

NFTs are transferable. Unlike cryptocurrency, Every NFT has a different value based on its uniqueness and It can be bought or sold on special marketplaces. These are powered by Blockchain technology which defines its authentication that makes it genuine. It helps to preserve the ownership rights of creators and the originality of the artwork.

Is it worth investing in NFT’s art?

NFTs are becoming most popular among digital artwork creators and people who want to invest in artworks. There are a lot of opportunities in investing in NFTs right now, including in the gaming industry with the rise of NFT game development companies. However, it also holds a little risk as these assets exist entirely in the digital universe. You can’t touch these like classic paintings or antique pieces, but you can get ownership rights of the same. NFT art can be a great investment as you can re-sell them for a higher price in the NFT marketplaces. Thus, it’s not necessary to be an artist to trade in NFTs; you can also make money by reselling these arts

There is also some risk of violation. The more NFT floated in the market the more volatile the worth of anyone and sustainability as the currency of trade in a crowded cloud of blockchain vapor. Sometimes people are stuck in a bubble of hype and when this bubble popped they realize their investment is worthless and suffer the loss. Again, We’re just at the tip of the iceberg. There are lots of opportunities to explore in this blockchain universe.

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