Chinese Central Bank PBoC’s governor, Zhou Xiaochuan stated that it doesn’t allow the payments made in bitcoins and other cryptocurrencies as they don’t favor speculative products. Though the bank is interested in the digital money.
People’s Bank of China (PBoC) doesn’t allow crypto payments
Over the past year, China has been cracking down hard on the cryptocurrencies. So, it doesn’t come as a surprise that the Governor of People’s Bank of China (PBoC) states that they don’t consider bitcoin as a payment tool.
In a press conference in Beijing on Friday, Zhou Xiaochuan, the PBoC governor talked about the cryptocurrency projects that have taken a shift from their proposed use cases into market speculation which doesn’t serve the economy. He further explained that:
“Lots of cryptocurrencies have seen explosive growth which can bring significant negative impact on consumers and retail investors. We don’t like (cryptocurrency) products that make huge opportunity for speculation that gives people the illusion of getting rich overnight.”
This might bring about an increased amount of scrutiny by PBoC over trading services and ICOs in the future. Even after the ban put by regulators on ICOs, these services are still available for the domestic investors in the country.
But… PBOC is interested in digital currency…
However, it doesn’t mean they are any bit less interested in developing digital money.
Zhou explained that one-day physical cash may become obsolete. Moreover, he mentioned that in their pursuit to provide cheaper, faster and easier payment modes, they are looking into the digital currencies. Zhou said:
“We must prevent major mistakes that would lead to irreparable losses, so we are cautious.”
The country which once had the most active cryptocurrency exchanges have banned maximum of these operators in their broad digital currency clampdown operation. Though it still leads in digital payments because of tech giants like Alibaba Group Holdings Ltd.
Blockchain favorable too…
Recently, the Chinese regulators took measures to block the ads of those cryptocurrency exchanges that are still engaged in trading services on some of the major social media channels and search engines.
However, the bank is positive towards blockchain development and asks for cautious efforts instead of growing too fast as stated:
“For blockchain projects with technological potentials, they should conduct thorough testing before rolling out services. Otherwise, a reckless expansion may incur serious security and financial stability issues.”
Everyone is aware of China’s stance on cryptocurrencies and it looks like the country is all set on how it perceives this market. Though, given China’s interest in digital currencies like other countries, it seems that it not only recognizes the potential of virtual currencies but wants to leverage it as well but only if they are controlling this booming industry.
What are your views on China’s strong disdain for cryptocurrencies? Let us know below!
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I am an associate content producer for the news section of Coingape. I have previously worked as a freelancer for numerous sites and have covered a dynamic range of topics from sports, finance to economics and politics.