NFT Theft Now a Criminal Offense in China as Government Takes a Stand
China has recently made a noteworthy announcement, bringing about a significant change in how the law deals with digital assets.
They’ve declared it a criminal offense to steal digital collections, including NFTs (nonfungible tokens). This move, outlined in an official statement on November 10th, signifies a considerable shift in perspective.
According to the statement, the theft of digital collections isn’t just about unauthorized access; it extends to intrusions into the systems holding these assets. This means that such actions will be treated as theft and the illicit acquisition of computer information system data, indicating a strong commitment to safeguarding digital assets in China.
The statement specifically labels digital collections as “network virtual property,” a crucial concept in criminal law. It highlights, “Since property is the object of property crime, digital collections can become the object of property crime.”
This recognition is crucial, especially given the unique technological aspects of these assets.
NFTs, a concept derived from abroad, are also explicitly mentioned in the announcement. They use blockchain technology to authenticate specific assets, making them valuable yet susceptible to theft due to their non-replicable, tamper-proof, and permanently stored characteristics.
Despite China’s ban on crypto-related activities since 2021, there’s a growing interest in NFTs within the country. Developments like Alibaba-owned peer-to-peer marketplace Xianyu and China Daily’s plans to establish its own NFT platform point to a thriving market for digital collections.
However, it’s important to note that, currently, China hasn’t opened a “secondary flow market” for these digital collections. Consumers can still use trading platforms for buying, collecting, transferring, or disposing of these assets while ensuring exclusive possession and control.
This decision by the Chinese government sets a legal precedent and reflects a proactive approach to the changing landscape of digital asset protection. It shows an evolving understanding of property in the digital age and establishes a notable benchmark for other nations facing similar challenges.