Beijing – Forex Reforms will Encompass Cryptocurrency
China has signaled that its stance on cryptos such as Bitcoin (BTC) may undergo transformation as it starts making moves to overhaul Forex markets.
According to a Reuters news report based on an unnamed government official, a fresh research attempt will involve widening the trial of Beijing’s cross border funding platform based on blockchain technology.
The platform, rolled out in March 2019, is presently undergoing a trial program in 19 of China’s provinces.
Lu Lei, deputy head of the State Administration of Foreign Exchange, stated that it will steadily widen the extent of trial and blockchain technology applications.
“We will gradually expand the scope of the pilot and the application scenarios of blockchain technology in cross-border financing and macro prudential management.”
Lu Lei further stated:
“At the same time, (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.”
The statement is obvious, considering the fact that China is getting ready to unveil its central bank digital currency (CBDC), which will not have any features of Bitcoin.
Mu Changchun, deputy director of the People’s Bank of China, or PBoC, elaborated on the digital yuan as follows:
“The currency is not for speculation. It is different to bitcoin or stable tokens, which can be used for speculation or require the support of a basket of currencies.”
According to a policy legislated in September 2017, all non-state activities related to crypto, including operating an exchange, was put under blanket ban.
Lu did not clearly explain how the outcome of the latest reforms would affect the norm. As far as blockchain is concerned, authorities are determined to promote adoption and rapidly increase use cases, the most recent of which is the utilization of technology for bond issuance.