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WeChat, the leading social media platform in China, is cracking down on accounts related to cryptocurrencies. The social media company has updated its policies and banned accounts that provide services related to cryptocurrencies and non-fungible tokens (NFTs).
WeChat bans crypto accounts
The new policies will restrict or ban accounts that deal in issuing, trading, and financing cryptocurrencies or NFTs. These digital assets will now be added to the “illegal business” group.
The new policy will also prohibit the trading of secondary NFTs. The firm said it would also focus on “accounts that provide services or content related to the secondary transaction of digital collections.”
This development was announced by Wu Blockchain, a crypto reporter, who noted that WeChat was a leading social platform in China, and the move would affect the over 1.1 billion users on the platform.
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The updated policies also note that “once such violations are discovered, the WeChat public platform will, according to the severity of the violations, order the violating official accounts to rectify within a time limit and restrict some functions of the account until the permanent account is banned.”
Crypto crackdown in China
China imposed a ban on cryptocurrencies in May last year. The country has deemed cryptocurrency mining and trading activities illegal in the country, and tech companies in the company have been forced to comply with these regulations.
While the crypto ban has been largely enforced, NFTs have remained in a grey territory, where they have neither been banned nor allowed. However, companies have been preventing secondary NFT trading because of the potential risks posed to investors.
Officials in the country have openly spoken against NFTs. In April, the China Banking Association, the China Internet Finance Association, and the Securities Association of China issued a joint statement notifying the public about the risks realized from investing in NFTs.
Some of the leading social media platforms in the country, such as WeChat and WhaleTalk, have distanced themselves from the NFT sector. Earlier this year, the two platforms announced they would ban or restrict NFT accounts from their platforms. The company noted that the decision was caused by a need for regulatory clarity and the fear of a government crackdown.
However, the lack of regulatory clarity has allowed NFT operations to flourish, with the number of NFT platforms in the country growing five-fold since February 2022 to surpass 500.
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