Chinese Authorities to Clamp Down on Fake Innovation in NFT Market

China’s Supreme People’s Procuratorate has published its views on the nonfungible token (NFT) market. The legal prosecution agency addresses the “securitization” of NFTs where one copy can be shared by multiple users. According to the agency, this no longer corresponds to the criteria of non-reproducibility, indivisibility, and uniqueness. The prosecutors also point out other threats to the NFT market, such as “inflation of prices,” which is triggered by marketing methods such as airdrops, blind boxes, and limited sales. They argue that the lack of “artistic beauty” and “reasonable pricing mechanism” behind inflated prices of some nonfungibles poses a risk and marketing models like rewards and dynamic rights can quickly evolve into illegal pyramid schemes. The proposed response to these risks includes a “crackdown on criminal activities” and investment in risk research and law popularization. China, which has an anti-crypto stance, takes a hostile approach towards artificial intelligence too. Chinese prosecutors believe that while the NFT market “has certain potential,” it bears significant financial, security, and “legal” risks and needs comprehensive governance to prevent pseudo-innovation.

J-S Tremblay
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I've been involved in the cryptocurrency world since 2016 and trading since 2019. I started Moon and Lambo in 2021. I'm passionate about crypto and love to share my knowledge. I hate bankers and I hope that cryptocurrency will change the financial world for the better. View full profile...

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