Shanghai Promotes NFT Metaverse Growth

The most populous city in the world’s most populous country has made public its plans to increase support for technological advancements in the metaverse over the course of the next five years. Other technologies, such as blockchain, NFTs, and Web3, were also addressed; however, it is still not quite apparent what role these technologies will play in the future. The preliminary version of the “14th Five-Year Plan for the Development of Shanghai’s Digital Economy” was made available for public review on July 13 by the city government of Shanghai.

The government made a commitment in the document to support “the comprehensive integration of digital technologies and the traditional economy.” The statement went on to suggest that this objective will be attained by “scientists appraising the prospects of technology” and “entrepreneurs discovering the demand in the market.”

Virtual reality headsets, processors, cloud computing, 5G technology, and other conduits will be the primary focus of Shanghai’s efforts to “strengthen cutting-edge technological advances.”

It was stated that 10 billion Yuan, which is equivalent to $1.5 billion, had been set aside to carry out the plan. The governing body of Shanghai has high hopes that the investment will jumpstart the city’s economy and lead to growth.

The direction of funding from the government will produce ten “leading” corporations that will serve as “chain-owner enterprises.” On the international market, these huge companies will compete with one another. The basic metaverse technology will be mastered by approximately one hundred smaller enterprises.

At a press conference held on July 8th, Wu Jincheng, head of Shanghai’s Economy and Information Technology Committee, stated that these companies will collaborate in order to achieve the goal of “benchmarking products and services.” This goal will be achieved through the collaboration of these companies.

The plan did briefly discuss developing NFTs and other cryptocurrency projects such as blockchain and Web3, but it appears that the metaverse is the primary emphasis of the strategy. The governing body of Shanghai will speed up research and deployment of the metaverse platform, with an emphasis on virtual concerts, idols, sports, and other forms of digital entertainment.

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Investing in the metaverse, according to Mr. Wu, “will stimulate the transformation and upgrading of numerous industries in the actual economy.” In addition to that, he claimed that there is a “great market value” in the metaverse. By 2025, it is anticipated that these three industries will bring in a combined total revenue of $224 billion.

Although the plan suggests that the government will encourage growing businesses that are creating NFT trading platforms and “study and promote the digitalization of NFT and other assets,” as of late, the government’s attitude toward cryptocurrencies has been somewhat ambivalent. The recent decline in the value of cryptocurrencies prompted the publication Economic Daily, which is published by the state, to advise citizens against investing in cryptocurrencies.

And despite this, information gathered by Statista indicates that the number of people interested in NFTs and the metaverse is highest in China, Hong Kong, and Singapore relative to any other region. In addition, China has recently established itself as a major mining hub, second only to the United States, in spite of a crackdown on bitcoin mining operations that took place in 2021.

The plan is dedicated to developing blockchain+ technology, which will be underpinned by an ecosystem for the development of blockchains that will feature robust innovation and independent control. In addition, preparations are being made to conduct research on Web3. Research in areas like as multi-platform OpenID, distrusted data storage, and a decentralized domain name resolution system (DNS) are just some of the topics that will be covered during the next five years.

The potential benefits of decentralized financing (DeFi) were not discussed at any point in the strategy. Nevertheless, “digital finance” was addressed in the proposal, along with the promise that “smart contracts” would be promoted and that “asset trading, payment and settlement, as well as registration and custody” would be improved.