NSC will strengthen the regulation of cryptocurrencies in 2018

The Institute of international Finance of the people’s Bank of China (PBOC) published a report that defines cryptocurrency as priority areas in 2018. The paper argues that widespread retail investment in cryptocurrency may represent a systemic risk for the yuan, but also stresses the intention of the PBC to expand its research and development in the field of cryptocurrency.

The report highlights the risks that the Chinese government sees virtual currencies — in particular the volatility of prices, which carries systemic risk to the yuan in the case of large-scale retail investment, and the possible illicit use of cryptocurrencies and the lack of a reliable regulatory framework for the protection of investors.

The document advocated strengthening the regulatory framework of China on the cryptocurrency, and also calls for the development of a comprehensive monitoring procedures, treatment of virtual currencies. The report also contains a proposal that the G-20 countries should take efforts to create global regulation of digital currencies, and provides arguments in favor of cooperation between international regulators on this issue.

The report also States that investigations in the field of money laundering through crypto-currencies and the disclosure of pyramid schemes should become the priority for Chinese regulators.

The NSC has recently published a document containing a brief description of topics discussed during the conference call the Central Bank issues national currency, gold, silver and monetary policy.

The document stresses the desire of the NSC to increase efforts to «promote research and development of digital currency the Central Bank» as a priority in the monetary policy framework in 2018. This suggests that the creation of the state of cryptocurrency China, which was rumored, remains the main focus of work of the Central Bank of the country.

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