“We solemnly turn shoppers to [...] be watchful and stand back from NFT-related illegal money activities,” said the associations.
The China Banking Association, the China web Finance Association and therefore the Securities Association of China issued a joint statement warning the general public concerning the “hidden risks” of investment in nonfungible tokens, or NFTs.
In a Wednesday notice, the 3 associations launched initiatives aimed at encouraging innovation within the crypto and blockchain space focused on NFTs still as “resolutely curb[ing] the tendency of NFT financialization and securitization” to reduce the risks around illicit activities. The China Banking Association same member institutions should not consider NFTs assets like securities, precious metals, and different money merchandise.
In addition, cryptocurrencies including Bitcoin (BTC), Ether (ETH) and Tether (USDT) should not be used for the rating and settlement of NFT transactions, platforms ought to perform real-name authentication and follow Anti-Money washing needs, and associations and companies in compliance shouldn't invest in NFTs or offer resource to others for doing therefore. different measures within the planned code of conduct enclosed not providing centralized transactions and not weakening the tokens’ nonfungibility “by dividing possession or batch creation, and completing token issue funding in disguise.” “We solemnly turn customers to ascertain correct consumption ideas, enhance their awareness of self-defence, consciously resist NFT speculation and speculation, be wakeful and keep one's distance from NFT-related outlawed money activities, and effectively safeguard their own property safety,” same the associations. “If relevant outlawed activities are found, they must be reported to the relevant departments in a timely manner.”
China-based regulatory associations have previously issued warnings to the public about investments in cryptocurrencies whereas also business on member establishments to abide by existing regulative provisions concerning digital assets. The country formally illegal crypto exchanges from providing services in 2017, however several people were able to use native bank accounts for crypto-related transactions before the People’s Bank of China started cracking down on the activity in 2021.
( Turner Wright, Cointelegraph, 2022 )