Important insights
- The Supreme People’s Procuratorate (SPP) reportedly spoke of severe retaliation against those who participated in the illegal activity.
- Two sessions in China highlighted growing concerns about the Metaverse.
- The surge in Metaverse-related trademark applications has stepped up scrutiny.
Illegal activity is increasing across the NFT Marketplace and in the Metaverse. The growing interest in NFTs and the Metaverse has drawn cybercriminals from the crypto market to sandboxes (SANDs), decentralands (MANA), and NFT spaces.
Falling cryptocurrency prices and rising NFT sales and land prices in the Metaverse are contributing to changes in criminal activity.
The increase in illegal activity has attracted the attention of regulators and governments. Since Russia’s invasion of Ukraine, surveillance has been strengthened as the government has sought to prevent Russia from evading sanctions.
This week, China issued a harsh warning to cybercriminals targeting NFTs and the Metaverse. The Supreme People’s Procuratorate (SPP) reportedly spoke of severe retaliation against those who committed illegal acts such as money laundering and financing.
News updates from two sessions in China on Tuesday highlighted growing concerns about the Metaverse. Zhang Ying, a member of the Chinese People’s Political Consultative Conference (CPPCC), reportedly discussed the need for proper regulation.
Regulation is needed to address data security, information protection, and speculation. Zhang, a member of the CPPCC, also talked about the level of speculation in the form of the current Metaverse.
Cryptography is illegal, but the Chinese government has stopped banning NFTs and the Metaverse. Despite the ban, government and state media continue to emphasize metaverse-related risks.
The focus on the Metaverse has come after growing interest from Chinese multinationals.
The warning from the Chinese government is not new to the Metaverse. Last month, the Bank of China and the Insurance Regulatory Commission warned the public about the risks associated with the Metaverse.
Last year, the People’s Bank of China (PBoC) also actively issued a warning about the Metaverse. In December, we reported that PBoC used AML tools to limit NFTs and metaverses.
Despite the crackdown, Chinese companies continue to apply for Metaverse-related trademarks.
Last week, Chinese tech giant Tencent applied for a patent for a virtual concert. Other well-known companies are also active, with Metaverse-related trademark applications filed in China and reported to reach 16,000 by late February.
In December, we talked about the potential for increased government oversight due to the proliferation of applications. With just the increase in numbers, governments may take more evasive action to deal with illegal activity.
