Tencent shuts down NFT platform as gov policy makes it impossible to thrive
China’s internet giant Tencent has reportedly shut down one of the two nonfungible token (NFT) platforms owing to declining sales aided by the regressive monetary policies of the Chinese government.
Tencent shut down one of its NFT platforms on July 1 while the other one is struggling to remain afloat. A report from a local daily indicates that the wind-down process for the same began in May. The tech giant transferred key executives responsible for managing the NFT platform in the last week of May and completely removed the digital collectible section from its Tencent News app by July's first week.
The primary reason for the slow down in sales and ultimate closure of Tencent’s digital collectible platform is being blamed on flawed government policy that prohibits buyers from selling their NFTs in private transactions after purchase, which makes these NFTS not so lucrative. The lack of a secondary market kills any chance of making a profit on these digital collectibles.
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 March, several Chinese social media giants such as Weibo and WeChat started removing accounts associated with digital collectible platforms fearing a government crackdown. In June, Alibaba launched an NFT platform but soon deleted all mentions of it from the internet.
Related: Chinese court rules marketplace guilty of minting NFTs from stolen artwork
While the Chinese government is known for its anti-crypto stance where
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