China Might Adjust FX Regulation for Cryptos
China is about to broaden the scope of its blockchain pilot in cross-border financing, Reuters reported Tuesday, citing a government official. Besides, China might reform the foreign exchange regulation to deal with cryptocurrency.
Gov’t to Adjust Forex Regulation for Cryptos
Lu Lei, deputy head of China’s State Administration of Foreign Exchange (SAFE), said at a forum in Beijing that the government pondered adjusting the forex regulation in the context of cryptocurrencies. The official stated:
(The government) will push forward a prospective study on foreign exchange reforms to deal with cryptocurrency and explore the construction of the foreign exchange regulation and technology system under the new situation.
Traditionally, China has been tough on cryptocurrency, after it banned initial coin offerings (ICO) and crypto exchange operations in 2017. However, Xi’s latest comments suggest that the country might consider a u-turn.
Blockchain Gets More Attention in China
China has suddenly turned into a major blockchain supporter after Xi Jinping endorsed the technology back in October, calling it a “breakthrough.”
Since then, government and corporate entities have launched several blockchain trials, including a cross-border financing pilot.
Lu stated that the regulator would increase the integration of fintech and forex market, while monitoring the blockchain development. He commented:
We will gradually expand the scope of the pilot and the application scenarios of blockchain technology in cross-border financing and macro prudential management.
China has been researching the application of technologies like blockchain and artificial intelligence in cross-border financing, emphasizing on risk management. The world’s second largest economy will continue to liberalise its capital markets by implementing the latest innovations.
Lu revealed that the SAFE’s blockchain platform in cross-border financing was the only one registered by a central state agency at the Cyberspace Administration of China (CAC).
SAFE’s platform, which launched in March of this year, has expanded last month to 19 provinces and cities, from 9 in March.
Do you think China will before more crypto-friendly soon? Share your thoughts in the comments section!
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