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- Tencent and Alibaba's Ant Group are distancing themselves from their NFT business, CoinDesk reported, citing local media.
- Both tech behemoths changed the word "NFT" to "digital collectibles" on their platforms and websites.
- The move comes as Beijing tightens its reins on the broader cryptocurrency market.
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Chinese technology giants Tencent and Alibaba affiliate Ant Group are distancing themselves from their non-fungible token businesses as Beijing tightens its reins on the broader cryptocurrency market, CoinDesk reported, citing local media.
Both behemoths changed the word "NFT" to "digital collectibles" on their platforms and websites.
For Tencent, the change highlights their resolve to comply with regulations, according to a statement. Meanwhile, for Ant, the replacement was initiated for "greater clarity," it said in a separate announcement.
The two tech firms reiterated their opposition to the speculative nature of NFTs as well as any illegal activities surrounding the tokens. They also emphasized their strict compliance with China's laws to minimize any consumer risks such as price hypes.
Ant even goes so far as to say it "only allows digital collectibles to be freely gifted between authenticated" users after being held for more than 180 days by at least one of them, alluding to the massive reselling phenomenon elsewhere.
Unlike in other countries like the US, where NFTs run unregulated on ethereum or solana, Tencent and Ant control their blockchains.
Authorities in China have not targeted NFTs yet. But following Beijing's decision to shut down bitcoin mining operating in June and its ban on all cryptocurrency transactions in September, the NFT market may be targeted next as some Chinese officials have referred to it as a "bubble."
NFTs are digital representations of artwork, sports cards, or other collectibles tied to a blockchain and usually purchased with cryptocurrencies that have exploded in popularity this year.
When people buy NFTs, they gain the rights to the unique token on the blockchain, not the artworks themselves. But the fact that the information on a blockchain makes them next to impossible to alter, increasing their appeal to artists and collectors.
In the US, major crypto exchanges like FTX and Coinbase have launched their own NFT marketplaces.