Xiaohongshu invests in US startup that builds Web3 internet platform

Chinese social media and eCommerce platform Xiaohongshu has invested in US-based startup SHIL.me, joining other Chinese tech companies in stepping into Web3 despite the Chinese government's regulations on cryptocurrencies and digital tokens.

In a statement, SHIL.me said it had raised US$1.2 million from investors including Opensea Ventures, Folius, Zee Prime, Mask, Xiaohongshu, Formless, DWeb3, Token Bay Capital, Big Brain, and Vibe Capital, to name a few. The company added that it will be continuing to iterate on its core product in the coming months, establishing key partnerships with NFT communities, and expanding its feature set.

MARKETING-INTERACTIVE has reached out to Xiaohongshu for more details.  

Earlier this year, it was reported that China was planning to launch its infrastructure to support the deployment of NFTs in an attempt to create an industry not linked to cryptocurrencies. 

A South China Morning Post article said state-backed Blockchain Services Network would create the infrastructure "BSN-Distributed Digital Certificate" (BSN-DDC) to differentiate it from crypto-transacted NFTs. Currently, all cryptocurrency transactions are illegal in China. The new infrastructure will offer application programming interfaces for companies and individuals, enabling them to build their user portals or apps to manage NFTs. 

Public chains are not legal in China as the country requires Internet systems to verify user identities and allow regulators to intervene in illegal activities. The report said to address this issue, Red Date Technology, which provides technical support to Blockchain Services Network, offers the open permissioned chain and it could be governed. Since its inception in China, it has localised more than 20 public chains already. 

Although public chains are not legal in China, NFTs, other the other hand, are legal. Chinese tech firms such as Alibaba and Tencent launched "digital collectibles" last year to embrace the trend of NFTs, but using the name "digital collectibles" for compliance reasons. Last year, JD.com also launched a blockchain-backed platform to sell digital collectibles similar to NFTs too. Its Lingxi platform and an initial batch of NFTs inspired by JD.com’s mascot Joy were launched with at least 2,000 pieces of each of its five mascots being sold out.

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