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Alibaba, Tencent rebrand NFT offerings as ‘digital collectibles’ amid Beijing’s scrutiny of new virtual asset market
- The rebranding moves by Alibaba and Tencent reflect their efforts to steer away from any potential conflict with Beijing, which has cracked down on Big Tech firms
- Chinese state-run media recently warned of a potentially ‘huge bubble’ in the NFT market
Coco Fengin Beijing
Chinese technology giants Alibaba Group Holding and Tencent Holdings have both renamed their non-fungible token (NFT) offerings as “digital collectibles”, as Beijing casts a wary eye on this new virtual asset market as a potentially huge bubble.
Alipay, the mobile payments operation of Alibaba financial technology affiliate Ant Group, now calls its latest NFT artworks – including digital paintings or virtual versions of antiques – as digital collectibles, months after launching NFT wallpaper for users’ payment code pages in June. Alibaba is the parent company of the South China Morning Post.
Ant Group “firmly opposes any form of illicit activity conducted in the name of digital collectibles” or “any form of price speculation on digital collectibles”, said a representative of AntChain, the Chinese fintech giant’s blockchain technology platform.
On Alibaba’s digital flea market Xianyu, a search for “NFT” does not show any results. A search for “digital collectibles”, however, turned up about a dozen items for sale.
Meanwhile, on Huanhe – the NFT platform launched by Tencent in August – all of the items on offer are now referred to as digital collectibles.
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SCMP Explains: What are NFTs?
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“We do not tolerate any illegal activities, including those related to cryptocurrencies,” said Tencent in a statement, which also indicated that Huanhe prohibited the transfer of digital products between users.
NFTs generally refer to units of data stored on a blockchain that guarantees each digital asset is unique, immutable and secure. Because NFT-based digital items are authenticated via a decentralised blockchain system, they can be owned much like physical items – a feature that makes NFTs valuable when it comes to trading collectibles and memorabilia.
The rebranding actions taken by Alibaba and Tencent reflect their efforts to steer away from any potential conflict with Beijing, which continues with a sweeping campaign to “prevent the irrational expansion of capital” and address “barbarous growth” in China’s technology sector.
“Chinese regulatory authorities are strengthening their supervision of NFTs” and have spoken with Big Tech companies about this market, according to a tweet posted on Saturday by Colin Wu, an influential blogger who writes about blockchain and cryptocurrency.
While Beijing has put the trading and mining of blockchain-based cryptocurrencies under intense crackdown, NFTs have remained a grey area.
Last month, a Chinese state-run newspaper warned of a potential bubble in NFTs, just as the country’s Big Tech companies – including Alibaba and Tencent – have started to dip their toes into this new digital asset market.
“It is common sense that there is a huge bubble in NFT transactions” and that “many buyers only focus on NFT as a format instead of the artwork or asset itself”, according to the article published by the Securities Times, a national financial newspaper supervised by the Chinese Communist Party mouthpiece People’s Daily.
The article cited Chinese cryptocurrency entrepreneur Justin Sun’s purchase of a digital avatar for US$10.5 million in September, along with the record-breaking sale of digital photo collage Everydays – The First 5,000 Days for US$69.34 million in March, as evidence of an overheated NFT market.
This article appeared in the South China Morning Post print edition as: Alibaba, Tencent rename NFTs as ‘digital collectibles’
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