The People’s Bank of China Clarified its Stance on Cryptocurrency

The People’s Bank of China Clarified its Stance on Cryptocurrency

On Friday, March 9, 2018, at the press-conference devoted to the People’s Bank of China operation, its authorities talked tough about cryptocurrency market speculation. Zhou Xiaochuan, Governor of the People’s Bank of China, declared that it was too early to speak about using cryptocurrency as a means of payment. He considers cryptocurrency market too speculative, which means absence of guarantees for investors and users of digital tokens. The PRC authorities’ actions on tough regulation of the cryptocurrency market are aimed at preventing speculations and national investors’ downfall.

On the other hand, Zhou Xiaochuan noted the government’s positive attitude towards blockchain startups, including  ICO. 

For new blockchain projects to be accepted by the PRC government they are required to undergo proper testing, quality analysis and be complied with the financial security principles.

Thus, the People’s Bank of China does not reject cryptocurrency as a means of payment and a future basis for a new system of financial relations. The point at issue is that to achieve the objectives set for cryptocurrency it is necessary to establish market relations and consequently market price formation of cryptocurrency.

The conclusion on the PRC’s positive attitude towards cryptocurrency seems to be more justified against the background of statements about the beginning of the national Chinese cryptocurrency (DCEP) development. It is expected to become the main means of international digital payment in the future.