In today's digital age, NFT (non-fungible token), as a popular form of digital assets, has raised questions about whether its trading in China is legal. With the rise of crypto art and virtual asset trading, the legal boundaries of NFT have gradually surfaced. So, is the trading of NFT legal in China? Do you know whether NFT has illegal risks? This article will explore this topic in depth and reveal the current situation and challenges of NFT in China's legal system.

 Legal status of NFT

As a digital asset, the legal status of NFT is still vague in China. At present, China has not made clear provisions on the legal ownership of NFT, which means that there are certain legal risks in NFT trading. Although NFT is known for its decentralization and non-substitutability, its trading is still regulated and constrained under the legal framework.

In China, digital asset trading is strictly regulated, and virtual currency trading is explicitly prohibited. Although NFT is different from traditional virtual currency, its attributes as a digital asset make it difficult to escape the regulatory sight. Therefore, there is a certain gray area in the law for NFT trading, and more clear regulatory policies are needed to regulate the market order.

 Legal risks of NFT

Although NFT has not yet been clearly and qualitatively classified as an asset category under Chinese law, there are some potential legal risks in its transactions. First, in NFT transactions, the protection of intellectual property rights is particularly important. Due to the decentralized nature of NFT, the intellectual property rights such as the originality and copyright of digital works face challenges. Once infringed, it is difficult to protect rights.

 Legal supervision and compliance development

In the face of the rapid development of NFT transactions, the Chinese government should strengthen legal supervision, regulate market order, and protect the rights and interests of investors. Establishing a sound legal framework for digital asset transactions, clarifying the legal status of NFTs, and strengthening intellectual property protection are one of the issues that need to be urgently addressed.

At the same time, the NFT industry should develop self-discipline, strengthen platform review and work authenticity verification, and improve transaction transparency and compliance. Only when legal supervision and industry self-discipline are combined can the NFT market continue to develop healthily and inject new vitality into digital asset transactions.

 Conclusion

In summary, there are certain ambiguities and challenges in the legal boundaries of NFT in China, and the government, industry and investors need to work together to build a compliant and transparent trading environment. When exploring the boundaries between the legality and illegality of NFT, we should remain vigilant, invest rationally, and promote the sustainable development of digital asset transactions. I hope that the NFT industry will move towards a more standardized and sustainable development path under the legal framework.

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As we all know, NFT tokens and the NFT industry are expanding rapidly. As a non-fungible token, NFT has its own unique value. Each NFT token has a special feature that distinguishes it. We know that assets such as digital art, sports art, and video game characters can now exist in the form of NFT tokens, and they can also be valued and sold with the help of NFTs. The ownership of NFT tokens is registered in the blockchain, and NFT projects are one of the largest financing waves in cryptocurrency. Many investors want to know whether NFT transactions are legal in China? Let the editor of the currency circle take you to understand whether NFT is illegal.

 Is NFT trading legal in China?

NFT transactions are legal in China. The domestic crackdown is on the speculation and trading of virtual currencies, as well as mining, but at the same time it also encourages and supports the development of blockchain technology, of course, including NFTs that do not involve virtual currency speculation.

For most people, NFT is a term that is both unfamiliar and somewhat familiar. It is unfamiliar because few people have mentioned what NFT is in daily life. It is somewhat familiar because some time ago, Alipay released NFT skins. NFT+Dunhuang concept+blockchain+Alipay+limited quantity caused these two skins to be snapped up instantly, and the popularity was unprecedented.

NFT can be simply and roughly understood as a digital certificate based on blockchain, which can digitize physical or virtual items, so everything can be NFT, but the fact is not that simple. You can take the familiar QQ number as an example. Everyone has an ordinary QQ number, but the QQ number is different, and the selling price is also different, but it attracts many people.

Although NFT has investment attributes, it is not worried about virtual currency speculation. As long as the NFT consumption platform operates legally and compliantly within the policy and regulatory scope, we GJ is very supportive. Under the global NFT development trend, pioneers like ODin
NFT have unlimited future.

 Introduction to the future prospects of NFT

As an emerging digital artwork and method for other media products, NFT has become very popular in recent times. But the popularity of NFT today is actually very similar to the popularity of CryptoKitties three years ago. From 2017 to 2018, CryptoKitties accounted for more than 90% of NFT transactions, and the ecosystem was not very diverse. At that time, NFT was mainly a game, and later it evolved into cards and became NFT artworks.

Three years ago, the value of the entire NFT market did not exceed US$42 million. According to the latest estimates of  which monitors the NFT market, the market value of NFTs increased by 705% to US$338 million by the end of 2020.

Although NFTs are not very liquid, they are still a very new field. Many projects are optimistic about NFTs, and the combination of the two will increase their influence to a certain extent. In addition, the NFT market is largely speculative, and it is likely to experience the sharp price fluctuations that cryptocurrencies have experienced in the past few years. As Nadya Ivanova, a researcher at NFTS at L’Atelier, a subsidiary of investment bank BNP Paribas, said. “The important thing to understand about the NFT market is that it is very new. The market is still going through different market cycles to determine the true value of things.” I hope everyone can understand whether NFT is illegal through this article. The use of NFT tokens can be said to have surpassed existing visual art. It uses highly innovative smart contract technology to store and record unique information on the blockchain. Only when new NFTs are created can people digitally prove that the assets are real, and now NFTs can be traded on specialized markets. NFTs can be said to provide a kind of income petition room for digital artists, who can profit from their work, and now NFTs are also growing in the field of consumer content and applications.

In addition, there are problems such as information asymmetry and price fluctuations in the NFT market, and investors need to be cautious. On some platforms, there are situations where the authenticity of NFT works is difficult to verify, and buyers may face the risk of false transactions. Therefore, in NFT transactions, it is crucial to remain vigilant and choose formal platforms to avoid legal risks.