The Central Bank of China today shared this message at approximately 5 p.m. local time. According to China expert Dovey Wan, the aim of the story is that China is going to monitor the regulation of cryptocurrency’s and derived products much more strictly. Nothing is left of the positive sentiment of a few weeks ago, when President Xi spoke positively about blockchain.
New rules, new opportunities
China is going very far in policy: “blockchain, not bitcoin.” The Central Bank (PBoC) has just released a new regulatory update that seeks to tackle digital currency trading in the country.
To highlight a few key points in the announcement
1 / ICO, IFO, IEO, STO are all unauthorized illegal public offering and securities issuance, and potentially illegal fund-raising, financial fraud, pyramid schemes and other illegal crimes
– Dovey 人服人 Wan ? ? (@DoveyWan) November 22, 2019
According to Dovey Wan these are the most important points in the announcement:
- The PBoC reaffirmed its position on ICOs, IEOs, STOs and similar. These are all illegal under Chinese law.
- Cryptocurrency exchanges that are located outside mainland China, but do provide services in China, are regulated more strictly. Fiat and billing channels are “cleaned up”.
- Shanghai law enforcement focuses specifically on digital currency platforms that are registered abroad.
Cryptos carry too many risks for consumers
The announcement also confirms the government’s position on the positive approach to blockchain, but not to cryptocurrency. The Chinese state believes that any form of financing, issuance and trading of cryptocurrency still carries too many risks for daily consumers.
The new rules do show how serious President Xi is to promote blockchain, while at the same time reducing the role of cryptocurrency. It is an interesting development to follow, to further anchor them with blockchain technology and at the same time to eliminate all speculative interest in cryptocurrencies. It is interesting to follow where this will lead, since blockchain and cryptocurrencys have had a symbiotic relationship since the birth of bitcoin.
Nothing more than a temporary stumbling block
Hopefully we will look back on this time in a while, while we cannot suppress a grin. Hopefully the adoption of cryptocurrencies will be a lot further and we chuckle because a world leader once thought that blockchain without cryptocurrencies was a possibility. And that these new rules are nothing more than a small stumbling block that we have jumped over with both legs.