The People’s Bank of China committee charged with regulating cryptocurrencies recently gathered to discuss the next phase in their plan.
China hasn’t wavered in its commitment to control cryptocurrencies within its territory — the country shocked the world when it announced a ban on all ICOs, deeming them illegal, back in September 2017. Not too long ago, it was announced China was considering blocking access to all websites related to crypto trading or ICOs, both domestic and foreign.
Pan Gongsheng, head of the committee, as well as Vice President of the PBoC, and Director of the State Administration of Foreign Exchange, was the loudest voice at the meeting. He believes their plan of action is at a crucial stage and now it will be the time to win the battle for online financial safety.
In order to succeed in their efforts, Gongsheng believes they need to focus on three core aspects — defining the standards of blockchain and online lending, reinforcing the boundaries of online insurances and non-bank payment services operating on digital currencies, and clarifying the legality of ICOs on all its forms.
When it comes to non-bank payment services, Gongsheng is very clear, saying, “You can do it with a license, and it is illegal without a license.” This means, regardless of these institutions operating on fiat or crypto currencies, they must apply for a license to remain compliant with the law.
As for ICOs, Gongsheng reminded these are still illegal, as they constitute offerings of illegally issued securities and non-compliant fundraising activities. He also pointed out that the ban doesn’t apply only to China-based operations — ICOs operating from overseas are also forbidden to market their projects within Chinese territory.
Gongsheng emphasized the committee would be focusing on bringing down illegal financial activities while building stronger infrastructures to prevent online financial fraud. They will also be conducting on-site inspections and applying administrative penalties to those who don’t comply.
He also addressed those ICOs who were approached by the committee and fled abroad, where they keep their activities active in China. In the near future, the group will be announcing a new method to block these companies from accessing Chinese people.
The group estimates they will succeed in their effort in the next two years, with the first deadline set for June 2019. By then, the committee hopes to have clearly defined standards for blockchain and the online lending space.
Featured image from Shutterstock.