A promotional campaign launched by Chinese bubble tea giant Nayuki, also known as Naixue Tea in Chinese, that includes tokens and virtual stocks has sparked off controversy on China’s social media platforms, with some netizens questioning whether the company is trying to get around domestic laws by launching virtual products.
The popular bubble tea maker rolled out a campaign on June 30, one year after it went public on the Hong Kong stock exchange. It launched a token called Naixue coins for its customers, and each customer can get one Naixue coin after spending one yuan ($0.15) on Naixue’s products.
Customers can then use the Naixue coins to redeem products in Naixue’s online shopping mall, as well as using the coins to buy or sell virtual stocks.
According to a statement published by Naixue to explain the campaign, the company’s virtual stock price equals the actual closing price of Naixue stocks on the HK stock exchange, with the calculation also taking the exchange rate of the Hong Kong dollar against the yuan into account.
Naixue said that customers can redeem virtual stocks to get gift coupons.
The campaign has aroused some controversy on China’s social media platform Weibo, as some netizens questioned whether Naixue’s campaign is legal.
In particular, Naixue’s issuance of virtual stocks to 50 million members became a hot topic, with 120 million reads as of press time.
One netizen wrote that the rollout of virtual stocks might be a form of illegal fundraising and could disrupt the financial market, as many customers might get obsessed with it. Some customers might even want to make money by trading the virtual stocks.
But some netizens also noted that virtual stocks are just an innovative promotion activity, and it is legal as long as it does not involve transfer functions or speculation.
The People’s Bank of China, China’s central bank, banned all crypto currency transactions last year.
An employee of Naixue told the Global Times on Wednesday that Naixue coins are different from the concept of crypto tokens, as the coins cannot be converted to yuan.
“Actually, Naixue coin is just another name for membership points,” she said. “It does not involve monetary transactions.”
The Global Times saw that some customers are already posting pictures to display their Naixue coin “assets” on Sina Weibo.
Some experts also said that the so-called bubble tea coins are unlikely to trigger large financial risks, as it is almost impossible to exchange them with legal currencies. Therefore, it is not regulated by China’s financial management laws or regulations, according to one commentary published on digital economy service platform 01caijing.com.
However, there is a risk of other kinds of legal problems, as virtual stocks could involve online lotteries and touch the legal red line of opening casinos, the commentary noted. Naixue’s promotion campaign involving virtual stocks sparks discussion over legal risks
Photo: Screenshot from Naixue.com
