Chinese law enforcement will take action against “pseudo-innovation” in the NFT market.
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Marketing strategies such as rewards and dynamic rights and interests, in the opinion of the public prosecutor, are easily turned into unlawful pyramid schemes.
The Supreme People’s Procuratorate of the People’s Republic of China, the national body in charge of criminal prosecution, expressed his opinion on the non-fungible token (NFT) market on May 15. Three authors of the published study outline prosecutors’ perceptions of the dangers of the market and the following justifications for enforcing them more stringently.
This essay focuses on the trend of “securitization” of NFTs, or the shared ownership of a single copy by multiple users, which, in the author’s opinion, no longer meets the criteria of non-reproducibility, inseparability and uniqueness.
“Price inflation” in NFTs, caused by marketing strategies such as airdrops, blind boxes and limited sales, is one of the threats prosecutors see, among others. The authors identified a lack of “artistic beauty” and “reasonable pricing mechanisms” as reasons for the exorbitant prices of some non-fungible items, adopting an ambitious blend of aesthetic and economic studies. The Procuratorate claims that marketing strategies such as gifts and dynamic rights and interests can quickly turn into evil pyramid schemes.
A crackdown on criminal activity, equal emphasis on governance and punishment, investing in risk research, and popularizing laws are all part of the suggested responses to this danger. According to the article, it will be the responsibility of the national prosecutor to distinguish between “true innovation” and “pseudo-innovation” and protect the former.
Despite Hong Kong’s continued progress in adopting cryptocurrencies, China has not changed its anti-crypto stance. Furthermore, the nation seems to view Artificial Intelligence (AI) with the same hostility. Early May, a suspect was arrested by local law enforcement and detained in China’s Gansu region after reportedly using ChatGPT to make fake news reports.
Although the NFT market “has some potential”, there are dangers associated with it in terms of money, security and law, according to Chinese prosecutors. As a result, the market requires total control and a crackdown on “pseudo-innovation”.
Post Chinese law enforcement will take action against “pseudo-innovation” in the NFT market. first appeared on BTC Wires.
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