China reaffirms tough stance on digital currencies
Xinhua urges governments and central banks to pay stronger attention to virtual currencies, and to work toward tightening regulations
China’s Xinhua News Agency has published an editorial piece taking a tough stance on digital currencies, calling for further regulations to curb hidden risks, and even criminal action on virtual trading platforms.
The piece urges governments and central banks around the world to pay stronger attention to virtual currencies, and to work toward tightening rules, claiming a regulatory vacuum exists in the sector.
A regulatory framework should be built up and methods such as record filing, licensing, real name registrations and large transaction limitations should be applied. It also calls on regulators to adopt a zero tolerance attitude with regard to financial transgressions.
Cryptocurrencies such bitcoin are often used by lawbreakers as a tool for money-laundering, drug trafficking, smuggling and illegal fund-raising. This is largely due to it being essentially anonymous, borderless and difficult to trace.
Previous crackdowns on bitcoin trading platforms were meant to hit speculators hard and maintain financial stability.
Previously, China banned Initial Coin Offerings (ICOs) — the up-and-coming method of raising funding via crypto tokens — and shut down bitcoin exchanges in September.