The People’s Bank of China (PBOC) has called for more regulation for cryptocurrencies, citing recent bank crashes.
A senior executive of the People’s Bank of China drew attention to the recent bank crashes in the United States. However, the official called for the regulation of cryptos in the name of protecting the financial system.
China Central Bank Concerned After Recent Bank Crashes
A senior Bank of China (PBOC) official has called for stronger regulation of digital finance, citing recent banking failures in the United States involved in cryptocurrency transactions.
Central Bank Deputy Governor Xuan Changneng made the following statements on the subject:
“The risks and fraud associated with cryptocurrency, including two U.S. banks that have been in trouble after providing many services for cryptocurrency, from deposits to swaps, have demonstrated that regulators must respect the rules when renewing regulations.”
While there should be ample room for innovation, he said, authorities need to validate and approve new technologies applied to various financial models and products, rather than simply accepting or approving them.
In addition to his explanations, he added:
“Regulatory philosophy, technology and capacity must be upgraded to ensure that financial innovation does not come at the expense of financial stability.”
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