It’s official, China launched the first Chinese NFT marketplace sponsored by the state. It will run on the China Cultural Security blockchain. However, it will use the trading instruments and settlement mechanisms of the China Technology Exchange.
The marketplace’s name translates to “China Digital Asset Trading Platform”. In addition to facilitating the trading of NFTs, it will also allow the trade of digital copyrights.
China and NFTs
There are fundamental differences in NFT trading between China and the rest of the world. For one, NFTs in China are “digital collectibles”. Also, Chinese residents cannot use cryptocurrencies to buy them, as the government bans crypto. Hence, they must trade with the Chinese fiat currency, the Renminbi RMB.
In early December, the Chinese court ruled that NFTs are virtual property that the law protects. It also stated that they “have the object characteristics of property rights such as value, scarcity, controllability, and tradeability.” Which was considered a huge milestone.
Details about the Chinese NFT marketplace are still scarce, except that it will enable the secondary trading of digital assets. Experts in the industry think it is highly likely that the China Cultural Security Chain will be centralized. That means all NFTs supported by the chain will not belong to the users. Rather they belong to the entity in control of the chain.
There is also no mention of interoperability between the China Cultural Security Chain and any other blockchains. This is mainly due to the Chinese ban on cryptocurrencies. Plus, it seems that non-Chinese NFTs will not have access to the state-backed marketplace.
Examples of Chinese NFT marketplace
- Jing Tang: One of China’s most popular marketplaces belongs to the tech giant Alibaba. It has over 26 million users and a daily flow of over 6 million. The platform runs on a hybrid blockchain called AntChain which works with government offices. Unlike their western counterparts, Chinese buyers have to provide their real names and complete their transactions with fiat currency.
- Huanhe: This marketplace is built on the Zxin Chain. A blockchain that belongs to the government-authorized Alliance Blockchain. The average price of the NFTs is higher in comparison to other marketplaces. And this platform does not support secondary trading and transfer.
- Lingxi: Another Chinese NFT marketplace is Lingxi, one of the biggest e-commerce retailers in China. Lingxi runs on its own blockchain technology called JD Chain. The company said it had developed an NFT technical service platform that users can store, verify and trace NFT collections.
So, as we said before, details about the Chinese NFT marketplace are still not fully out. But with hundreds of trading platforms already running, the future looks promising. According to Statista, the highest number of google searches for the word “NFT” is from China. Also, they predict the NFT transactions in China to reach US $4.57 billion in 2026. By the mid-2020s, Metaverse in China will grow to US $50 billion.