China’s NFT market, Moutai metaverse popular but buggy… – Cointelegraph Magazine
After a one-year hiatus, Our Man in Shanghai returns, but he’s no longer based in Shanghai (the crypto crash was a factor in the column‘s retirement), so a rebranding is in order. This space is now called “Asia Express” and is a weekly roundup of news from mainland China and Taiwan and the rest of Asia as well. Check in every Friday for news on Asia’s more influential projects, changes to the regulatory landscape and enterprise blockchain integrations. A lot has changed since the last edition on December 17, 2021. Without further ado, let’s dig in.
China’s National NFT Market
In a joint effort between the state-owned Chinese Technology Exchange, the state-owned Art Exhibitions China and the company Huban Digital Copyrights Ltd, China’s first national NFT marketplace is scheduled to come online this week.
It is designed as a secondary market for the trading of digital collectibles, along with digital asset copyrights. Perhaps unsurprisingly, it’s built on China’s national Wenbao, or “cultural protection” blockchain, which helps verify the authenticity of artifacts and commercial goods. Currently, only the NFT platform’s landing page is available.
1,400 blockchain companies in China
On December 29, the state-owned China Academy for Information and Communications Technology, or CAICT, revealed in its national white paper that over 1,400 blockchain firms are operating in the country despite strict regulations. Together, Chinese and US blockchain firms account for 52% of such entities globally. In one example of public service distributed ledger applications, CAICT researchers wrote:
“[In the] Zhejiang Provincial blockchain electronic invoice platform, [authorities] used blockchain’s multiple access points and decentralized process capabilities, along with technological highlights such as smart contracts, to improve cross-departmental trust verification. This led to digital circulation of electronic invoices; their issuance, receipt, inspection, reimbursement and improved information management level and service functions for electronic invoices in finance departments.”
Similarly, local news agency Shanghai Securities News reported that the digital yuan central bank digital currency, or e-CNY CBDC, exceeded 104.8 billion Chinese yuan ($15.21 billion) in use in Zhejiang province since its inception in April. Residents of the province have opened 24.14 million e-CNY wallets, and the government claimed to have distributed 3.5 billion yuan ($510 million) in tax refunds via e-CNY to residents as an experiment. Despite the results, experts such as former Chinese central banker Xie Peng said “usage has been low” for CBDCs.
Kunming Blockchain KPIs
On December 30, the city of Kunming published its three-year plan for the development of municipal digital economy. The report set a 25% annual growth target for the city’s digital economy to surpass 500 billion yuan ($72.58 billion) in two years. In addition, local-level Communist Party officials must meet collective key performance indicators to incubate at least 20 blockchain-specific applications and encourage the development of at least 10 “highly competitive” and technologically advanced blockchain firms by the end of 2024. “Please implement [them] fully and completely”, the document states.
Moutai’s metaverse hits 1 million users
On January 1, popular Chinese spirits distiller Moutai and internet technology firm WangYi launched their joint metaverse Xunfeng World on the Apple App Store. Developers designed the experience based on the Moutai distilleries in Guizhou province. Players can interact with each other and distill to learn the traditional Moutai experience.
Just two days later, registered users crossed 1 million, with the app ranking No. 1 in the e-commerce category in China. However, the app only had a 2.4/5 rating at the time of writing, with users complaining about in-game features, “excruciating” wait times for Know Your Customer verification, login difficulties and poor customer service. One user wrote:
“There is no customer hotline, there is no customer service and I don’t even know where to go to solve the problem. I was looking forward to join from the waiting list but I could never pass KYC on the day of app release. What is wrong? I’m literally begging you to take my money so I can play this game, but you don’t seem to want it?”
Hong Kong’s crypto scam is worsening
Currently, Hong Kong residents cannot trade cryptocurrency unless they are classified as “professional investors” or have at least 8 million Hong Kong dollars ($1.02 million) in bankable assets. However, these regulations have done little to curb the rise of crypto fraud.
A recent Hong Kong police report cited by Rthk.hk revealed that in the first 10 months of 2022, the special administrative region recorded 1,503 cases of investment fraud involving total assets of $98.5 million, up 10% from the same period last year .
About 70% of the scams were classified as involving crypto. One victim, Mr. Lee, reportedly lost HKD 180,000 ($23,000) after being contacted by a representative who claimed access to exclusive inside information on the price of SUSHI tokens. Mr Lee later called the police after his supposed trading account was removed without explanation.
Square Enix all-in on blockchain
In an annual letter published on January 1, Yosuke Matsuda, president of Japanese gaming giant Square Enix, said the company will shift its business focus to blockchain entertainment. The move follows Square Enix’s May 3 announcement that it will sell its blockbuster Tomb Raider game series and use the proceeds to invest in new initiatives like blockchain, although it will still retain other popular franchises like Final Fantasy. Matsuda wrote:
“I think it’s fair to say that blockchain gained significant recognition as a field in 2022, as evidenced by ‘Web 3.0’ becoming a well-established buzzword among business people. However, the year also saw volatility in the cryptocurrency and NFT markets that followed the dramatic changes in the macro economy described above.
Matsuda also said that aside from monetization, blockchain and NFTs should “deliver new experiences and excitement to customers” and that the company had “several blockchain games based on original IPs in development.” In its latest filing, Square Enix reported 163 billion Japanese yen ($1.23 billion) in revenue and 39.4 billion yen ($297 million) in profit for the first six months to September 30.
