China is leaving no stones unturned in promoting the usage of digital yuan while ensuring a crackdown on the Bitcoin and cryptocurrency industry.
According to the latest report, China is gearing up to establish a digital asset exchange in its sprawling capital of Bejing. The guidelines issued by the State Council also mentioned that Beijing will look into setting up a bourse for digital assets trading in a bid to foster financial services in the region.
The world is witnessing the rapid progress made by China with respect to its central bank digital currency. As a matter of fact, the cabinet had earlier requested faster trials of the digital yuan. It had even asked the banking institutions to launch e-CNY operation firms. However, no details have been disclosed regarding the planned digital asset exchange so far.
Most recently, Governor Yi Gang of the People’s Bank of China highlighted the need for the digital yuan to prevent competition with the existing banks. As such, the governor explained that e-CNY was an “M0” asset, meaning interest cannot be earned. The central bank will supervise the issuance of the digital yuan, while lower-tier financial authorities will serve as “intermediaries.”
Gou Wenjun, Director of the Anti-Money Laundering Monitoring and Analysis Center of the People’s Bank of China, reportedly took a fresh jab at the “virtual assets” and expressed his concerns over national currency sovereignty, anti-fraud, anti-money laundering, and anti-terrorist financing.
He said there is a need to enhance the transparency of such assets while looking into the application of regulatory sandboxes to examine their nature.
Interestingly, he also spoke about “abandoning the illusion of anarchy and decentralization” and rather endorsing technological advancement and innovation that are in line with human values, respect for ethics.
While referring to the current state of virtual currencies, non-fungible tokens [NFT], and various items in the “meta-universe” or Metaverse, the governor stated that these are “naturally isolated” from the real world. Since these aspects have a “certain degree of interoperability,” they can soon emerge as money laundering instruments for malicious entities.
According to his speech, the focus of the regulatory bodies should be around cryptocurrency crackdown. This can be achieved by monitoring crypto transactions, enhancing traceability and scene tracking systems, and strengthening data sharing and cooperation with global financial intelligence firms.