Tencent stops operations on one of its NFT marketplaces
On July 1, Chinese internet and technology giant Tencent, shut down Tencent News’ NFT marketplace, one of its two marketplaces. The move was due to a decline in sales exacerbated by the harsh monetary policies of the Chinese government.
Local news reports stated that the platform’s downfall began in May and saw the tech giant’s transfer of key executives responsible for managing the NFT marketplace to other departments in the final week of May. The digital collectibles section from the Tencent News app was removed in the first week of July.
The strict monetary policy that banned the trade of NFTs in private transactions after initial purchase was identified as what caused the decline in trade volume and the shut down of the marketplace. NFT traders can no longer engage in reselling of their NFT purchases and secondary sales. In other words, they can no longer make profits from trading NFTs.
Many believed 2022 was the year of NFTs in China, with several Chinese tech giants such as Tencent and Alibaba indicating plans to launch their own digital collectible platforms. However, other tech giants such as Weibo and Wechat began removing their platforms in March 2022 as they forsee an impending government crackdown.
NFTs gained a lot of traction in China earlier this year, with several tech giants such as Tencent and Alibaba showing interest and even launching their own digital collectible platforms. However, with the rise in popularity, it also got attention from the government, which has warned investors to be wary of frauds associated with these NFTs. In June, Alibaba also launched an NFT marketplace but ended up deleting all mentions of it from the Internet.