Hanan province of China is increasing NFT oversight to boost culture and tourism

Hanan province of China is increasing NFT oversight to boost culture and tourism

China has shown some commitment towards the development of its non-fungible token (NFT) market with a recent move to increase its oversight over blockchain-related activities. This is despite the country’s belligerent stance towards the mining and trading of cryptocurrencies.

Closer scrutiny of Hanan NFT industry

Authorities in the province of Hanan announced on Sunday that they’d increase the scrutiny on NFTs to combat criminal activities associated with it. The public notice stated that the province’s oversight function has become necessary to prevent risks that investors in NFTs are exposed to, such as fraud and the activities of criminal gangs that can use NFTs as instruments for money laundering and illegal fundraising.

The notice published by nine agencies in the province of Hanan enjoined regional authorities to step up their monitoring and regulatory oversight in the digital assets industry with the view to ensure appropriate guidance and compliance for investors and other participants in the market.

The memo said that this would help the market regulators to monitor and evaluate the financial risks associated with the digital collectible market in all the regions of the province. The memo further stated that NFT firms are required to get approval from relevant agencies to operate. It added that the function of these agencies includes ensuring that artworks and blockchain information of the projects are properly assessed by the authorities.

A close tie between culture and tourism

Hanan authorities are interested in protecting the NFT industry even as they’re working to have it regulated. The province is a popular destination for tourists in South China. This could be the reason why the authorities are insisting on developing an appropriate guideline for NFTs.

Local authorities said that even though they would want the Hanan NFT market to be regulated, they expressed interest in using it to develop the tourism industry of the province. The release identified the potential of NFTs as an instrument that can drive free trade, culture, and tourism in the province.

China’s stance on cryptocurrencies

China moved against cryptocurrency transactions in 2021. The country is yet to set out rules governing NFTs, even though state-backed media have described their use as speculative behavior.

The memo suggested, among other measures, that regulatory authorities in Hanan monitor market access for NFTs, ensure proper licensing of industry players, eliminate propaganda in marketing and investigate incidents of fraud in the industry. Other issues that are covered by oversight functions are copyright infringement prevention, covering ideological security risks, and strengthening public and investor education.

Softening stance toward digital assets

Justin Sun, the co-founder of Tron, said that the recent move by the Hanan authorities is an indication that China will soon start taxing cryptocurrencies, which he thinks is the first step toward the legalization of digital assets in the country. Sun announced on January 29 that he intends to move to Hong Kong, citing the softening stance of the Chinese authorities towards cryptocurrency.

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