Chinese internet heavyweight Tencent Holdings is pulling the plugs on its non-fungible token (NFT) platform Huanhe. The company stated that it would cease releasing digital collectibles to the public. This is coming as the country’s regulators step up plans to scrutinize NFTs and other digital collectibles.
Tencent Holdings, which launched its proprietary NFT platform Huanhe in August last year, as NFT began gaining momentum, stated that starting Monday, the company will no longer launch new NFTs to users. Speaking on the fate of existing NFT holders on the platform, Tencent Holdings stated that owners of existing collectibles will still be able to hold their digital collectibles. In addition, existing holders can display their digital collectibles or ask for a refund for their assets.
According to a statement from Tencent, “the company is making efforts to focus on its core strategy. To this end, the company is focused on adjusting its business operations.”
Huanhe has continued to grow since it launched in August last year. Today, it is among the biggest and most successful NFT platforms in China, with the platform seeing massive sales in the last couple of months.
Regulatory concerns and the hope of budding companies in the digital space
The move by Tencent will come as a rude shock to many NFT users in China, especially as Huanhe created an opportunity for Chinese crypto users to partake in the NFT market. Unfortunately, mounting regulatory scrutiny by Chinese regulators has forced the company to limit its NFT participation.
It should be recalled that Tencent and Ant Group signed an agreement in June to prevent the secondary trading of digital collectibles. This move was necessitated following media coverage from state-owned media, highlighting the issues around NFT speculations. It appears the move hasn’t done much to impress regulators.
While the purported shutdown of the Hunahe NFT marketplace was first reported in July, the latest statement from Tencent confirms the rumor. So far, the company hasn’t released any elaborate details of what would happen to its NFT brand, Huanhe.
Tech brands in mainland China have trodden carefully with NFT since it took off a few years ago. Most indigenous NFT platforms avoid using wordings like NFT, preferring digital collectibles instead.
