Shanghai winks at NFT trading platforms
After reporting concerns about financial risks associated with non-fungible tokens, some Chinese authorities are offering advice on how best to use the new technology.
The Shanghai government says it supports “leading companies to explore the creation of NFT exchanges,” according to the city's 14th Five-Year Digital Economy Plan released this week.
Although the directive is not national, what is being tested in Shanghai, the largest Chinese city in terms of GDP and known for its economic openness, can probably serve as an example for other regions.
>The government's intention for NFTs is clear: to use them as a tool to protect intellectual property, which still seems to have gaps in the country. Indeed, the plan wants the city to have a head start in researching and promoting "the digitization of assets such as NFTs, the global circulation of digital intellectual property, and the digital authentication of ownership." .
On the other hand, Chinese authorities have been unequivocal in their criticism of speculative NFTs. In April, major Chinese financial industry associations proposed that NFTs not be used for securitization; nor should they be traded with cryptocurrencies, which have been banned in the country.
These suggestions effectively rule out the existence of global NFT marketplaces like OpenSea in China. What the country allows, however, are private consortium blockchains run by trusted institutions. Tech giants like Tencent, Alibaba and Baidu have all built their own marketplaces for “digital collectibles” – a term adopted by some in China to downplay the negative financial connotation of NFTs – where consumers cannot make purchases. only using the country's fiat currency and prohibits secondary trading.
Blockchain, the distributed ledger technology that underpins NFTs and cryptocurrencies, is also often mentioned in Shanghai's digital economy plan. It's planned. Over the years, China has embraced blockchain with open arms, with President Xi Jinping lending his personal support to the technology.
On the one hand, the document calls blockchain a "key technology", placing it side by side with artificial intelligence, cloud computing and big data - sectors that have strong support from authorities.
Blockchain should be "deeply fused" with AI, big data and other new technologies to "enhance" fintech applications, for example, using distributed ledgers and smart contracts to enable transactions of end-to-end payment. Blockchain can also be used to authenticate identities and facilitate trusted transactions, the document states.
After reporting concerns about financial risks associated with non-fungible tokens, some Chinese authorities are offering advice on how best to use the new technology.
The Shanghai government says it supports “leading companies to explore the creation of NFT exchanges,” according to the city's 14th Five-Year Digital Economy Plan released this week.
Although the directive is not national, what is being tested in Shanghai, the largest Chinese city in terms of GDP and known for its economic openness, can probably serve as an example for other regions.
>The government's intention for NFTs is clear: to use them as a tool to protect intellectual property, which still seems to have gaps in the country. Indeed, the plan wants the city to have a head start in researching and promoting "the digitization of assets such as NFTs, the global circulation of digital intellectual property, and the digital authentication of ownership." .
On the other hand, Chinese authorities have been unequivocal in their criticism of speculative NFTs. In April, major Chinese financial industry associations proposed that NFTs not be used for securitization; nor should they be traded with cryptocurrencies, which have been banned in the country.
These suggestions effectively rule out the existence of global NFT marketplaces like OpenSea in China. What the country allows, however, are private consortium blockchains run by trusted institutions. Tech giants like Tencent, Alibaba and Baidu have all built their own marketplaces for “digital collectibles” – a term adopted by some in China to downplay the negative financial connotation of NFTs – where consumers cannot make purchases. only using the country's fiat currency and prohibits secondary trading.
Blockchain, the distributed ledger technology that underpins NFTs and cryptocurrencies, is also often mentioned in Shanghai's digital economy plan. It's planned. Over the years, China has embraced blockchain with open arms, with President Xi Jinping lending his personal support to the technology.
On the one hand, the document calls blockchain a "key technology", placing it side by side with artificial intelligence, cloud computing and big data - sectors that have strong support from authorities.
Blockchain should be "deeply fused" with AI, big data and other new technologies to "enhance" fintech applications, for example, using distributed ledgers and smart contracts to enable transactions of end-to-end payment. Blockchain can also be used to authenticate identities and facilitate trusted transactions, the document states.
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