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China Tops Regional Interest in NFTs

It has been a rollercoaster year for the NFT ecosystem so far. Since the beginning of the current bear market for cryptocurrency and other digital assets, the traction surrounding NFTs has also faded. Overall interest in NFTs in the last 30 days has dropped by about 25%, perhaps as a result of some of the recent challenges that the industry is facing.

NFT Overall

Despite these challenges, the curiosity level and interest from specific regions of the world still vary. In the last 30 days, information from the data aggregation platform, Google Trends shows the top five countries with the highest queries about NFTs to be China, Hong Kong, Nigeria, Singapore, and South Korea, in that order.

NFT Gators

China’s leadership in this case comes with mixed feelings and expectations that cannot be predicted in a straight line. First, the Chinese government has distinguished between the categories of digital assets that are banned within the region, among which NFTs are not completely included. Secondly, the permitted NFT practice in China is categorically different from the global approach. The conditions under which practitioners can carry out NFT activities in the country have also been a subject of curiosity.

Data from Google Trends show that the top related queries under the subject are:

  • NFT Meaning
  • What is NFT
  • OpenSea NFT
  • OpenSea
  • NFT Art

The peculiarity of the Chinese NFT market may have encouraged inquisition into what NFTs are all about.

In China, NFTs are treated quite differently from other parts of the world, even down to their nomenclature. Based on regulation, NFTs in China are identified as “Digital Collectibles”. Although the government claims to be working on a permanent regulatory framework for the industry, there are existing restrictions on how these digital collectibles can be owned and transferred.

A key aspect of the regulation in China is the prohibition of secondary transactions for digital collectibles. This means that once a piece of digital collectible is purchased from the issuing platform, it cannot be resold by the owners in the marketplace. This is a move by the government to prevent speculations that could distort the digital assets market and by extension, the digital economy. Also, permitted digital collectibles in China can only be transacted using fiat currencies to avoid the possibility of opaqueness in related financial transactions that could deny the government of complete oversight functions over the industry.

These measures by the government have not gone down completely well with practitioners in the ecosystem. The abolishment of secondary transactions has in a way limited the profitability potential of the industry, leading to one of the industry giants, Tencent closing down its NFT marketplace.

Perhaps, this action by Tencent and other NFT-related activities from other parts of the world have triggered the curiosity of netizens, hence the effort to understand the industry better and probably seek alternative channels of participation. This could explain why OpenSea, one of the largest NFT marketplaces on the internet, is among the top queries over the last 30 days.

Cryptocurrency activities in China have faced significant resistance in the past year. There has been an exodus of practitioners in the industry, including miners and service providers. While the government continues with its effort to expel the technology from its region, the interest of the people in a rather globalized technology cannot be neglected. Perhaps, the growing interest in NFTs is a pointer that there could be more out of China as far as digital assets are concerned.

 

 

 

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