China’s biggest tech firms to check ID for NFT buying

In a new ‘self-discipline initiative’, China’s biggest tech firms agreed to enforce real-name authentication for NFT buyers and to avoid secondary marketplaces. The agreement, which is not legally binding, is an acknowledgement from the industry of regulations that already exist in China for blockchain-based assets.

China’s tech giants check IDs before buying NFT

China’s non-fungible token (NFT) industry has published a “self-discipline initiative” that promises identity checks for users, adherence to the country’s ban on cryptocurrencies and a promise not to establish secondary marketplaces to fight speculation.

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”, reads the 14-article document endorsed by many of Chinese tech firms.

The document, an effort from private companies that is not legally binding, was published by the China Cultural Industry Association last week. Many companies involved in China’s digital collectibles market have signed on, including Tencent Holdings, Baidu, JD.com, and Ant Group, the fintech affiliate of Alibaba Group Holding.

The agreement calls on signatories to “firmly resist speculation” in the market.

“Do not contain financial assets or unlicensed financial products, including securities, insurance, credit and precious metals, in blockchain-supported goods,”

Chinese popularity of NFTs is on the rise, and digital collectable platforms have grown 5X in just four months from February to mid-June 2022 despite multiple warnings from the government. Hundreds of NFTs listed on OpenSea from Shanghai residents during COVID lockdown.

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