China Internet Finance Association Issued NFT Financialization Warning in April 2022

The China Internet Finance Association issued guidelines on April 13, 2022, calling on member institutions not to invest in NFTs or provide financing for such investments. The initiative prohibited practices that would dilute NFT non-fungible characteristics, including fractional ownership or batch creation that could constitute token issuance financing. On December 5, the association and six other industry bodies released a joint risk alert reaffirming that virtual currencies cannot be used as currency within China and that no real-world asset tokenization activities have been approved by Chinese financial regulators.