The People’s Bank of China plans to conclude what it began in 2017 by enhancing crypto’ “reforms and supervision’’ regulations in the country. Last year saw the government of China crackdown on initial coin offerings (ICO) and also halted the local cryptocurrency exchanges from dealing with the Renminbi.
From last year, the government of China has not been soft on cryptocurrencies and digital asset exchanges. It all began when The People’s Bank of China (PBOC) cracked down on ICO projects, rendering them illegal. This led to the closure of cryptocurrency exchanges, and people have been following PBOC’s actions to see whether it will allow the re-opening of these crypto exchanges. From the look of things, this is not going to change given that the PBOC is considering creating its own central bank digital token.
PBOC has recently revealed its plans to tighten the regulations, targeting even the cryptocurrency operations including multi-level-marketing schemes. The bank further notes that traditional fiat money has adverse effects on the economy’s interest rates and a PBOC issued cryptocurrency would bolster interest rate measures.
Reports indicate that China has all along been interested in creating its own cryptocurrency and a lot of research in Blockchain technology has been ongoing. There is a strong belief that a PBOC digital currency is likely to help negative interest rates and therefore, the central bank’s Research and Development efforts should be sped up.
There has been talk that the Chinese government doesn’t favor cryptocurrencies but allows blockchain technology to thrive. There is a reason to believe that a digital Renminbi issued by the PBOC I the reason why PBOC is cracking down on public blockchain like bitcoin.