STEPN will stop serving all users in China to comply with the country’s policies on cryptocurrencies.
The GMT token tanked following the news, dropping nearly 20% over the past 24 hours.
Play-to-earn games and similar services are starting to get the attention of lawmakers.
Web3 app STEPN has announced that it will ban all of its users in China due to the country’s anti-crypto policies. The GMT token has subsequently taken a steep hit to its price, dropping nearly 20% over the past 24 hours.
The project explained the process further, saying that users would have to make their own decisions about handling in-app assets,
“If you expect to log in and use your account from a GPS or IP location in the region over a long period of time, we encourage you to make your own decisions about the handling of in-app assets. During this period, more details will be notified to users through official social media announcements, emails, in-app alerts, etc.”
Chinese users account for 5% of the app’s three million users. The project will have had no choice but to comply with local jurisdiction, or risk incurring the wrath of the Chinese government. It is far from the first project to drop services in China, and it may even come as a surprise that it is happening so late.
Projects Face Potential Restrictions As Governments Catch Up
STEPN’s decision to step out of China is symbolic of how the wider world is changing when it comes to crypto apps. Governments see this as unregulated ways to earn money, and they want restrictions on this. Taxation and KYC are among the highest priorities.
This is the reason that GameFi and play-to-earn games have become such a problem in many countries. Latin America and Southeast Asia in particular has seen a great deal of growth in these sectors, and governments have taken note.
However, in some cases, enthusiasts will fight bans and restrictions, despite all the risks associated with it. Bitcoin miners in China have defied the ban and have increased their hashrate to become the country with the second-largest hashrate.