As he was taking an afternoon nap, Lin woke up to a persistent turmoil on his phone.
Members of the WeChat group with hundreds of people participating in the auction Non-fungible token (NFT)Lin participated in what Beijing calls speculation that needs to be suppressed.
“No. 28, bundle offer of 3 CCTV Yang Yang lion items, bid starts from 0 yuan,” the auctioneer announced in a WeChat group of 500 participants. This is the maximum number allowed by the app on weekday afternoons. “Each bid requires an additional 10 yuan (US $ 1.5),” the announcer added.
To avoid technical barriers, the team ran the same auction at least nine group chats at the same time. Forkast Have learned.
China is that NFT trading risk warningAlong the previous diatribes line against property and stock purchases and frequent reversals.
State media At the forefront of rhetoric Even if they themselves set up a marketplace to trade tokens or set up their own market, they oppose NFT trading. To avoid party bureaucrats, Chinese companies have relied on calling NFTs “digital collectibles.” Slip-ups aren’t entirely unusual,..
Last month, the industry lobby of the banking, securities and internet financial sectors Encourages members to “resolutely curb” the wave of “financialization and securitization” Of NFT.
Meanwhile, China’s NFT market swelled to 3 billion yuan in April. According to the estimate From the securities company Caitong Securities. The market in January is estimated to be 45 million yuan.
There is nothing to stop us
“Group chat No. 5 at 200. Group chat No. 1 at 500,” continued the auctioneer in Lin’s group. “Let’s be more generous with our bids!” The announcer added when bids began to enter.
It’s easy to ridicule the activity, but the operators of these chat groups only take advantage of the tendencies that the Chinese speculate.
Especially when it comes to mobile technology and digital payments, this country’s big leap to the cutting edge of world technology has only meant a new era of avatars of practice that has been in place for centuries.
Since the ancient Chinese Emperor Yao asked his son Go to play Go, Chinese spectators have tended to bet on results, especially for the elderly, which has evolved into everyday entertainment. For delivery in 1997, Deng Xiaoping famously said in Hong Kong that “horse racing will continue and dance parties will continue.”
Lynn’s group auctions three digital collectibles Published by China’s national broadcasting station CCTVFeaturing a panda and dragon mascot, it closed for 2,200 yuan in just minutes after a bid frenzy among about 4,500 participants. Each of these NFTs sold for only 98 yuan when launched last month.
“Congratulations on your successful bid! I’m sure it will prosper for a year,” added the auctioneer, followed by Gavel’s emoji and the line “It’s a deal!”.
The evolution of the tendency to infer from Go to NFTs meant attracting younger viewers to gambling addiction.
Lin, who prefers pseudonyms because of subject sensitivity, said he was following these auction groups and successfully sold his NFT through such chat groups.
“I trade frequently and prices range from hundreds to thousands of yuan,” said Lin, in his twenties, who was “guessing about cryptocurrencies” before China. Forbidden crypto trading Last September.
“Sometimes you get several times the initial price,” Lin said. Forkast.. “But sometimes you can lose 90% quickly,” he added, based on his trading experience.
As the demand for NFTs surges, a whole new trading industry is born.
Some vendors of Alibaba-owned China’s leading online second-hand trading market, Xianyu, have begun offering information monitoring services to investors, informing them of NFT sales and airdrop details.
Some vendors also act as WeChat brokers to help clients find specific digital collections they like.
Did you die in the water?
Not surprisingly, industry experts are a little worried about what such enthusiasm will bring to the industry.
Yifan He, Chief Executive Officer of Red Date Technology, the developer of state support Blockchain-based service network (BSN), Said Forkast If market players continue to package NFTs as investment products, he says he sees a dark future for the industry.
Because some NFTs “have the characteristics of quasi-financial instruments,” there is no way for Chinese regulatory agencies to allow speculative activity in the asset class.
“In principle, we need to avoid monetization of digital collectibles,” said HongfeiDa, CEO of blockchain developer Onchain Technology, a member of the lobby of the Internet financial industry. Issue an April Advocacy Statement.. “Once you raise money, it’s easy to use as a speculative tool,” he added.
“Each platform has its own interpretation, setting a lock-in period for resale and limiting the amount of transfers,” says Da.
See related article: China’s state support developers say they will resist the temptation to NFTs
Despite regulatory uncertainty, on many platforms, the demand for transactions is still too great for a business opportunity to miss.
“At this point, we only operate the primary market that issues NFTs,” said Pengfei Wang, CEO of Shucan CN, an NFT platform launched in January in China, quickly becoming one of the largest players. I did. Forkast.. “In April alone, digital collection sales totaled about 8 to 9 million yuan,” he said.
Spread your bet
According to Wang, many platforms in China operate their own secondary markets, with significant trading demand from their user communities, while Shucang CN opens up markets with less risk of potential regulatory headwinds. I’m trying.
With compliance in mind, ShucangCN will acquire an auction company last month and offer NFT auction services in late May or early June, Wang said.
“We hope to diversify our revenue streams, ideally half from direct sales and half from secondary transactions by the end of this year,” he said, setting the company’s annual revenue target of 200 million yuan this year. He added that he did. ..
He said cooperation with the cultural stock exchange is also being considered.
“We are in talks with a cultural property exchange called Huaren Shushang and will offer a secondary transaction with them at the end of May,” Wang said, in order for such an exchange to operate a cultural property trading business. He added that he holds the relevant transaction license for.
Hui Zhang, CEO of China’s NFT issuance consulting firm Metachi, said it’s still unclear if cultural properties and stock exchanges can really pave the way for NFT trading in China, which is good. It is a survey.
The government has not made clear its attitude towards NFT transactions, April statement The industry lobby, established by Chinese regulators, can provide insights into the authorities’ thinking, Wang and Zhang said.
Wild West
At some point, industry groups have hinted that NFT platforms should not simply be willing to run a secondary market without proper trading qualifications, Zhang pointed out.
“It’s important to have regulations in place to boost market development,” Wang said. Without clear rules, risky events can occur and regulators can ban trading with a universal approach. He added that it could be.
Wang said compliance was ShucangCN’s top priority when the team decided on the blockchain to build for the company’s platform in November.
“We have adopted BSN,” he said. team is, BSN-DDCNFT infrastructure developed by countries without links to cryptocurrencies.
“The industry can only thrive within a sound regulatory framework, or it could be totally banned, just as it happened in the peer-to-peer lending industry,” Wang said. I am.
The king mentioned a peer-to-peer (P2P) lending frenzy in China a few years ago. Forced the hands of the authorities When many households are wrecked because they couldn’t repay the loan with debilitating interest payments.
China Multi-year clamp down According to national banking regulators, the industry is chopping the number of such platforms from 5,000 to just three in 2020.
When it comes to investing, Lin, who likes to jump into the flavors of the season, says he’s late for the game because he just started buying NFTs earlier this year.
“My friend who bought it [digital collectibles] Last year we were already “enjoying their meat,” Lin added.
“Now, stop asking questions,” Lin said. Forkast Reporter. “I need to take a nap now,” he added, spending his lunch break tracking the latest NFT sales.
