TLDR
- Former Chinese finance minister calls for closer study of crypto
- Cites Trump’s campaign remarks as reason for Beijing to pay attention
- Acknowledges risks but calls crypto crucial to digital economy
- Notes SEC approval of Bitcoin and Ethereum ETFs
- Contrasts mainland China’s caution with Hong Kong’s crypto embrace
Zhu Guangyao, China’s former minister of finance, has called on Beijing to pay closer attention to the cryptocurrency markets.
Speaking at a summit hosted by Tsinghua University, Zhu emphasized the need for the Chinese government to study recent international changes and policy adjustments in the crypto space.
The former minister’s remarks come in light of comments made by Republican presidential candidate Donald Trump on the U.S. campaign trail.
At the Bitcoin Conference in Nashville this July, Trump stated that the United States must fully embrace the crypto industry, warning that “China will do it” if America doesn’t take the lead.
Zhu highlighted Trump’s comparison of the crypto industry to the steel industry of a century ago, noting the candidate’s prediction that cryptocurrency might one day overtake gold.
This high-profile endorsement of crypto by a major U.S. political figure seems to have caught the attention of Chinese officials.
While acknowledging the potential of cryptocurrencies, Zhu also stressed the importance of recognizing the risks associated with them.
He stated that crypto “has negative impacts, and we must fully recognize its risks and the harm it poses to capital markets.” However, he balanced this caution by describing cryptocurrency as “a crucial aspect of digital economy development.”
The former finance minister also pointed to recent developments in the United States financial sector as a reason for China to reassess its stance on crypto.
Specifically, he mentioned the Securities and Exchange Commission’s (SEC) approval of bitcoin (BTC) and ether (ETH) exchange-traded funds (ETFs), despite initial opposition from the regulatory body.
This call for a closer examination of cryptocurrencies marks a potential shift in thinking among some Chinese officials. Mainland China has maintained a cautious approach to cryptocurrencies, with strict regulations in place.
However, Hong Kong, which operates under a semi-autonomous system of government and market regulations, has taken a more welcoming stance towards the crypto industry.
Hong Kong has recently listed bitcoin and ether ETFs, signaling a more open approach to cryptocurrency investments. Additionally, some members of Hong Kong’s mini-legislature have actively courted crypto businesses to set up operations in the city.
This divergence in approach between mainland China and Hong Kong highlights the complex landscape of cryptocurrency regulation in the region.
Zhu’s comments suggest that some Chinese officials may be reconsidering the country’s stance on cryptocurrencies in light of global developments.
The former finance minister’s call for further study indicates a recognition that the crypto industry is becoming an increasingly important part of the global financial landscape.