Chen Weigang, the former Vice President of China Insurance Regulatory Commission of the Communist Party, sat down with Yiben blockchain media to talk about ICO regulations and digital currency trading in China.
Chinese Communist Party Exec Wants State Monopoly on Digital Currency #CryptoCurrency #digital https://t.co/mHEXHA9gEX — Robin Yearsley (@robinyearsley) February 28, 2020
On February 27, it has been reported that he told the media that a central bank digital currency (CBDC) is an important strategic plan for the Chinese RMB to gain an upper hand in international economic development.
However, Chen was asked to comment on the ongoing ICO Ponzi schemes in China, as he believed that ICOs and cryptocurrency trading needed to be banned completely in the future.
“I always believe that speculation in cryptocurrency and ICO is not the direction of financial development and must be resolutely banned.”
One of the main difficulties in regulating such pyramid schemes is that there is no clear supervision division in the current regulatory framework. Chen thinks that in order to crack down on the ICO scams and cryptocurrency speculations, all regulators including China’s banking and insurance regulatory commission, China securities regulatory commission, public security organization and Internet and cultural authorities should work together.
Though Chen thought that cryptocurrency speculation was illegal, he pointed out that digital assets trading was a different story. He said that digital assets were tradable with fiat currencies.
“As for digital currency transactions, I believe that the supervision of various departments in the country will become more and more strict, leaving no market for transactions. For example, Banks and formal payment institutions will be prohibited from providing channels for digital currency transactions. Private deals may continue, but they will not be mainstream.”
Likewise, according to Chen, China has been preparing for DCEP (Digital Currency Electronic Payment) ever since 2015. He explained that DCEP’s direct peg to the Renminbi was an important national strategy for China.
Thus, he added concluded:
“We must be ahead of the rest of the world, at least technologically. Only in this way canthe RMB take the initiative in the future international economic development.”