This month, a blockchain platform operated by Ant Group, Alibaba Group Holding’s financial arm, started selling computer graphics depicting traditional headpieces of the Miao, a Chinese ethnic minority.

The graphics, priced at 18 yuan (US$2.66) each, immediately sold out all 10,000 pieces made available as a rush of buyers gummed up the system.

These “digital collectible” – a softer neologism for NFTs – have been in China’s virtual space since around 2021. Apart from Ant Group’s platform, Jingtan, fellow tech giants such as Tencent Holdings have launched similar services.

NFTs, or non-fungible tokens, have value because they attach ownership to what is otherwise freely downloadable digital content. But in China, NFTs typically are not issued through decentralised blockchains, but rather through databases managed by Chinese enterprises.

Because China has banned payments using cryptocurrencies, the NFT transactions are tendered with the yuan.

NFTs are seen as a way to create a new market for artists and collectors to trade digital works freely. But the assets also draw questions regarding the potential for uninhibited speculation.

In response to those concerns, many digital collectible platforms have blocked resales of NFTs, but more than a few services let users transfer ownership, ostensibly with no money changing hands.

That transfer feature has opened the door for a cottage industry of separate platforms where sellers of digital collectibles match with buyers. For example, immediately after selling out, the computer graphics of Miao headpieces would appear on an online flea market at a 50% markup.

Jingtan does not endorse underground resales of its NFTs, but a symbiotic relationship has developed between platforms for selling and trading the assets. If authorities crack down on the resale market, purchasing digital collectibles would not make economic sense.

In early July, there were 820 selling platforms, nearly triple the number from early May, according to Chinese media.