Digestible news on the latest developments across the fields of NFTs, blockchain and metaverse in China, compiled for you every week by Pandaily.
This week: Tencent‘s WeChat suspends NFT accounts, Chinese AR glasses maker Nreal raises $60 million in series C+ funding round, Taiwanese pop star Jay Chou claims someone stole his Bored Ape NFT, and more.
Tencent’s WeChat Suspends NFT Accounts
Tencent Holdings’ WeChat has recently suspended several accounts associated with NFTs and clarified rules overseeing such digital assets, according to reports by CNBC and SCMP.
- According to SCMP, several public WeChat accounts used for marketing NFTs (or digital collectibles, as they are referred to in China) have been suspended for at least two weeks.
- At around the same time, Ant Group’s digital collectible platform Topnod punished 56 accounts for participating in the resale of digital collectibles for profit.
- The Chinese government has taken a tough stance against crypto, declaring all transactions related to crypto illegal since last September.
- Chinese NFT projects differ significantly from their international counterparts in that the former can only be bought with the Chinese yuan, rather than actual cryptocurrencies.
- Beijing also poses restrictions on secondary market trading of NFTs for fear of speculation, but rules regarding digital assets remain unclear. (CNBC, SCMP)
Chinese AR Glasses Maker Nreal Raises $60 Million in Series C+ Funding Round
Chinese augmented reality (AR) glasses maker Nreal completed a $60 million Series C+ Funding Round last week, bringing the total it has raised within 12 months to $200 million, according to reports by Bloomberg and VentureBeat.
- Alibaba Group Holding Ltd. led the investment, joining rivals Tencent Holdings Ltd. and ByteDance Ltd. to stake a claim in the future of the metaverse.
- The Beijing-based AR glasses maker will use the proceeds to increase investment in research and development, accelerate business expansion into new markets (including China) and strengthen Nreal’s existing partnerships with developers, according to Venture Beat.
- Nreal was valued at $700 million in a previous round announced in September 2021, according to Bloomberg, citing CNBC, which cited unnamed source.
- Alibaba‘s investment follows similar moves by Chinese tech giants looking to enter into the metaverse. Last year, TikTok owner Bytedance made its initial foray into virtual reality (VR) through the acquisition of a startup called Pico. Meanwhile, Tencent is nearing a deal to acquire gaming handset startup Black Shark.
- Nreal was founded in 2017 by Xu Chi, a former engineer with American AR accessories manufacturer Magic Leap Inc. The Chinese startup now has over 400 employees and is backed by big-name venture capital firms like Sequoia China and Hillhouse. (Bloomberg, VentureBeat)
Huobi Tech to Launch Crypto ETF for Retail Investors in Hong Kong
Huobi Tech is looking to roll out a cryptocurrency-tracking ETF for retail investors in Hong Kong, according to reports by Cointelegraph and SCMP.
- The Hong Kong-listed company has submitted a plan to the Securities and Futures Commission (SFC) to make its ETF accessible to retail investors with less than $1 million in assets, according to SCMP, citing sources familiar with the matter.
- Huobi Tech created the plan to “…give better protection to investors, as the fund will be regulated under Hong Kong law,” according the company’s senior vice president, Romeo Wang. He added that the company is actively engaging with the SFC in the hopes of obtaining “proper licences and approvals.”
- The ETF plan was created in response to Hong Kong regulators’ recent reevaluation and relaxation of local crypto laws relating to retail investors.
- In January 2021, SFC and the Hong Kong Monetary Authority (HKMA) released a joint circular offering limited exceptions for retail traders to take part in the crypto ETF market that trades on regulated exchanges in the United States and the United Kingdom, according to Cointelegraph.
- The SFC has already approved four managers to offer cryptocurrency funds to professional investors, each needing at least $1 million in assets to qualify. Huobi Tech offers several such funds.
- Huobi Tech’s ETF plan marks the latest move by cryptocurrency advocates to obtain consent from Hong Kong’s financial regulators for retail investors to participate in the virtual asset market. (Cointelegraph, SCMP)
China’s Central Bank Announces Third Batch of E-CNY Pilot Cities
The People’s Bank of China (PBoC) has announced its plan to expand a pilot scheme for its digital currency to more areas, including six cities in the country’s eastern Zhejiang Province, which is set to host the Asian Games later this year, according to reports by Reuters and Forkast.
- The PBoC said in an online statement that it will promote R&D of the e-CNY, as well as expand the scope of the pilot scheme to the cities of Tianjin, Chongqing, Guangzhou, Fuzhou, Xiamen, as well as coastal Zhejiang province.
- In 2019, the Chinese central bank rolled out e-CNY testing programs in Shenzhen, Suzhou, Xiong’an, Chengdu. In November 2020, it added six new pilot cities to the list: Shanghai, Hainan, Changsha, Xi’an, Qingdao and Dalian.
- The PBoC has ramped up testing of the digital currency in recent years and used the Beijing Winter Olympics as an opportunity to promote the yuan globally.
- Data released by the PBoC show that as of July 2021, Beijing has tested its digital currency in over 1.32 million pilot sites, covering use cases such as utilities, restaurants, transportation, shopping, government services. More than 20 million digital wallets were created for retail customers, with transactions totalling 34 billion yuan ($5.34 billion). (Forkast, Reuters)
SEE ALSO: China to Expand Scope of E-CNY Pilot
Taiwanese Pop Star Jay Chou Claims Someone Stole His Bored Ape NFT
Taiwanese singer-songwriter Jay Chou announced via Instagram on Friday that one of his “Bored Ape” NFTs had been stolen, according to reports by SupChina and SCMP.
- The singer said when he learned from a friend that his NFT was “stolen by a phishing website,” he initially thought it was an April Fool’s Day joke.
- Chou’s NFT is from the world’s most prestigious and priciest collection in the world. The floor price for a BAYC NFT currently sits at 109.99 ETH, or around $372,600 at current prices for the Ethereum cryptocurrency, according to SupChina, citing data from NFT marketplace OpenSea.
- Records on OpenSea show that Chou’s stolen NFT image, identified as BAYC #3738, was transferred away from Chou’s account around 3 a.m. New York time on April 1, then quickly changed hands at LooksRare, another NFT trading platform, for 155 ETH, roughly equivalent to over $500,000.
- Chou has been a long-time supporter of NFTs. In January 2021, a firm backed by Chou launched the Phanta Bears, a collection of 10,000 algorithmically-generated digital avatars inspired by the pop star’s fashion brand. The collectibles sold out less than 40 minutes after their release on OpenSea. (SupChina, SCMP)
How Ukraine Uses NFT, Crypto, and War Bonds to Finance Its Defense
Three London-based software engineers helped the Ukranian government create and sell 1200 NFTs earlier this week, raising about $600,000 to help fund the country’s defense against Russia, according to a report by CNN.
- President Volodymyr Zelensky’s administration has also encouraged donors around the world to directly transfer cryptocurrencies, an effort that has raised more than $56 million, according to analytics group Chainalysis.
- In addition to using novel technologies like blockchain as a lever for wartime financing, the Ukrainian government has also turned to more traditional tools for raising funds.
- Kyiv has raised roughly $1 billion from war bonds sold to individuals and institutions across Ukraine, as residents show a willingness to lend to the government, even if they might not get their money back.
- One-year notes issued last month had a yield of 11%, indicating a high level of risk.
- The administration has also received about $4 billion in emergency financing from multilateral organizations, including the IMF and World Bank. An additional $2 billion is being negotiated.
- President Zelensky’s team has estimated that the war could cost the country $565 billion. The country’s total economic output in 2020 was $155 billion. (CNN)
That’s it for this week’s newsletter – thanks for reading! As always, I welcome any feedback on how to make this newsletter better. My email is [email protected]. Spring is here!!! Go for a run in the sun, and I’ll see you again next week!