China Will Tighten Rules For Crypto Trading and ICOs In the Future, Says PBoC Advisor

Sheng Songcheng, a senior adviser to the People’s Bank of China, stated on Thursday that Chinese financial regulators will continue to tighten rules for cryptocurreny trading and ICOs in the future, according to Caixin.

Sheng’s comment comes two days after numerous well-known cryptocurrency or ICO related news accounts were shut down on the messaging giant WeChat and hotels, shopping malls, restaurants, and office buildings in Beijing’s bustling Chaoyang District were ordered not to provide venues for activities promoting cryptocurrencies.

Obviously, Chinese authorities have renewed their efforts on cracking down on activities related to the digital money in a bid to protect the financial safety of the public and to stabilize the country’s financial system.

Sheng pointed out that bitcoin and other crytocurrencies do not have the fundamental attributes needed to become a currency . For example, bitcoin lacks support from any central authority and its limited supply could not meet modern economic development needs. Besides, it is traded  anonymously and peer to peer, so bitcoin makes it easy for money laundering and tax evasion.

 “ Chinese authorities will step up their oversight of those who use virtual currencies to conduct illegal activities in accordance with existing laws.” Sheng says.

When it comes to ICOs, he adds that it’s not a surprise that Chinese regulators pay close attention to ICOs as the new the funding model grows wildly. “ A greater risk may emerge if we don’t put a lid on it. A large number of crypto scams would entail a great economic loss, and it also leads to a situation of “bad money drives out good”, leaving real blockchain entrepreneurs in a dilemma. ”Sheng says.

Sheng Songcheng who has served at the Chinese central bank for over 20 years believes the crackdown on ICO activities is beneficial for the development of the blockchain industry as a whole. And he predicts that China will put forward more stringent measures against ICO projects.

In addition, BJNews reported today that Chinese financial regulators will adopt three approaches to crack down crypto trading activities in the country. That is, regulators step up their efforts to block the internet access to 124 exchanges which have oversees IP addresses but available in the country; they will permanently shut down domestic websites and public wechat accounts which are involved in crypto and ICO services; third-party payment vendors are required to scrutinize and halt relevant suspicious accounts.

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