China warns against using metaverse for illegal fund-raising

fund-raising metaverse
FILE PHOTO: A visitor is pictured in front of an immersive art installation titled "Machine Hallucinations — Space: Metaverse" by media artist Refik Anadol, which will be converted into NFT and auctioned online at Sotheby's, at the Digital Art Fair, in Hong Kong, China September 30, 2021. REUTERS/Tyrone Siu

BEIJING (Reuters) -China’s banking and insurance regulator issued a warning on Friday against using the metaverse as a tool for illegal fund-raising, amid widespread interest in the country’s private sector.

The China Banking and Insurance Regulatory Commission said in a statement published on its website that some companies were engaging in illegal fund-raising, fraud, and virtual real estate speculation.

“Beware of being duped, and if you find clues of suspected illegal crimes, please actively report this to the relevant local departments,” the statement said.

Investors, entrepreneurs, and established Chinese tech giants have piled into the country’s “metaverse”, described as a virtual shared space that blurs the boundaries between the online and offline worlds. But the fervour has received mixed reactions from Chinese authorities.

The state-backed China Mobile Communications Association’s Metaverse Industry Committee was set up in October, although analysts say the country’s metaverse will be subject to more control than elsewhere.

Experts say China’s metaverse efforts lag countries such as the United States and South Korea, citing less investment by domestic tech giants.

But interest has begun to surge. In the past year, more than 1,000 companies including heavyweights such as Alibaba Group Holding, and Tencent Holdings Ltd have applied for around 10,000 metaverse-related trademarks, according to business tracking firm Tianyancha.

While the ruling Communist Party and state media have issued calls for caution and warned about the risk of a metaverse bubble popping due to over-speculation and financing, some local governments have held symposiums on the topic and also described how it could be used to spread Party ideology.

(Reporting by Eduardo Baptista; Editing by Sam Holmes)

Related article: China’s metaverse will be censored, compliant and crypto-less

Be the first to comment

What do you think?

This site uses Akismet to reduce spam. Learn how your comment data is processed.