China Weighs Calls for Crypto Regulations

March 31, 2019

The People’s Republic of China has taken a notably harsh regulatory approach to the cryptocurrency industry over the past several years, as evidenced by its complete ban on crypto exchange platforms, crypto trading, and initial coin offerings (ICOs), among other crypto-related activities.

Nevertheless, the Chinese government has recently introduced new anti-anonymity regulations to allow for what it describes as “orderly development” in its blockchain sector.

Chinese legislative delegates and political advisors are also calling for clear and strict crypto regulations during the country’s largest annual political meeting, the ongoing “Two Sessions,” when both the National People’s Congress (NPC) and the Chinese People’s Political Consultative Conference (CPPCC) convene for two weeks

The Question of Crypto Regulations

Shi Guilu, a deputy of the NPC, China’s legislator, and chairman of Shaanxi Rongmin Holdings Group, stressed the importance of formulating a clear regulatory framework for virtual currencies. His proposal to this year’s NPC session is to define digital assets as non-fiat currency.  Shi is also advising the government to tighten its control on the cryptocurrency market and introduce strict, concise regulations.

Meanwhile, Gong Fuwen, member of the CPPCC, believes cryptocurrency tradings should be banned in their entirety to prevent financial risks. He also proposes regulating digital tokens as private equity securities if they raise funds via ICOs, arguing that these types of projects should be barred from “raising hype” by relying on the concept of blockchain to sell their products.

Such proposals by key political advisors and legislative delegates indicate an overall push for strict regulatory measures, aiming to eliminate fraudulent ICO projects and what is being perceived as overblown hype surrounding crypto assets.

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