Former Deputy Finance Minister of China, Zhu Guangyao, recently urged for the immediate study of international cryptocurrency trends and corresponding policy adjustments.
Shifts in US Crypto Policy
According to local media reports, Zhu Guangyao stated that the US policy on cryptocurrencies has undergone significant changes, particularly after the approval of a Bitcoin ETF by the US Securities and Exchange Commission (SEC). Previously, the US government considered cryptocurrencies a major threat to anti-money laundering and counter-terrorism financing efforts. However, the new policy indicates a recognition of the economic potential of digital assets. "Cryptocurrencies indeed have negative impacts, and we must fully be aware of their risks and harm to the capital market. But we must also study current international changes and policy adjustments, as it is an important aspect of digital economic development," said Guangyao. Additionally, Zhu noted that former US President Donald Trump had shown a positive attitude towards cryptocurrencies. Trump explicitly included cryptocurrency in his campaign platform and stated that if the US does not embrace cryptocurrencies, China could potentially take a leading position in this sector. Trump's speech signals how cryptocurrencies could influence economic competition between major countries.
Risks and Opportunities for China
Former Chinese Finance Minister Lou Jiwei also warned that the volatility of cryptocurrencies and their potential involvement in money laundering could disrupt global market stability. Lou emphasized that changes in US policy on cryptocurrencies should be carefully studied by the Chinese government. He believes it's important to understand both the opportunities and threats that the digital economy presents, especially given the price instability that can negatively impact the financial system. Lou also pointed out that cryptocurrencies have long been viewed as a threat to monetary stability, particularly in the context of money laundering and terrorism financing. Therefore, he urged China to thoroughly examine the implications of cryptocurrencies to protect its financial system from potential shocks.
Building a Strong Digital Economy
In response to these challenges, Zhu Guangyao indicated that China needs to pay attention to how the world views cryptocurrencies, especially BRICS member countries such as Russia, South Africa, and Brazil, which have taken significant steps in adopting cryptocurrencies. According to him, in-depth study of international policy changes is crucial for promoting the development of China's digital economy in the future. China also needs to consider the potential benefits and risks offered by digital assets, especially since cryptocurrencies can be a means of wealth protection amid economic uncertainty. For instance, over the past nine months, reports have shown that over-the-counter (OTC) cryptocurrency brokers in China have increased activity, with investments reaching over $75 billion. This indicates that Chinese society is increasingly turning to cryptocurrencies as a way to protect their wealth.
Economic and political changes on the international stage require China to closely monitor the development of cryptocurrencies. The country must study new trends and adapt its policies to support the digital economy and protect its financial system.
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