Cryptocurrency Restriction From China In Digital Yuan Preparation!
China’s 2017 ICO and crypto trading ban had shocked the market at the time. Since then, officials in the country have continued to impose restrictions on cryptocurrency trading.
Hard penalty for crypto money issuers from PBoC
According to a bill published on October 23, the Bank of China (PBoC) is calling for public comment on its plan to ban issuing cryptocurrencies.
The document contains the following statements:
“NO UNIT OR UNIT WILL BE ALLOWED TO CREATE OR SELL TOKENS, COUPONS OR DIGITAL TOKENS TO REPLACE THE CIRCULATION OF CHINESE YUAN IN THE MARKET.”
As part of the draft, PBoC defined the yuan as both physical banknotes and its digital counterpart. While ICOs have already been banned, it appears that the latest law could target those issuing stablecoins or organizations that create tokens that are seen as competitors to the yuan.
Breaking: The People's Bank of China issued a draft of legal comments, clearly stipulating that no unit or individual may produce and sell tokens, coupons and digital tokens to replace CNY in circulation in the market. pic.twitter.com/rH7i4w4mJO
— Wu Blockchain (@WuBlockchain) October 23, 2020
By banning the issuance and sale of tokens that could compete with the digital yuan, PBoC’s central bank appears to be preparing for the launch of its digital currency.
The country’s digital currency, the digital yuan, is currently in testing in major cities in China. Also in early October, the Shenzhen government distributed $ 1.5 million worth of tokens to 50,000 people via airdrop . It was reported that as of the end of October, DCEP had processed more than 3 million transactions and these transactions were worth $ 160 million.