The Central Bank of China Sees Cryptocurrency As Possible Risk To Yuan

China's Central Bank Eyes Crypto As Possible Yuan Risk

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  • Central Bank of China says cryptocurrency is posing risk to Yuan
  • Further steps have been taken to monitor overseas crypto exchanges servicing local investors.

China: In an announcement made today Thursday 29th March, the Central Bank of China has declared that it is making effort this year to protect Yuan – the country’s currency – and fighting digital currencies will top the list. In a conference call that aimed at monetary development, the People’s Bank of China (PBoC) has defined its set plan for the coming year, according to the announcement.

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PBoC’s deputy governor, Fan Yifei, applauded the achieved progress on the research and development on the digital currency by the central bank. He, however, emphasized that ensuring the integrity of Chinese Yuan is one of the three main concerns for this year.

Yifei, therefore, stated that the agency will strengthen its regulatory processes both internally and externally in order to “rectify different kinds of cryptocurrencies.”

Although this remarks did not disclose much about the agency’s plans to continue with digital currencies, however, going forward with digital currency comes as a result of the agency’s widened effort to scrutinize crypto-related projects that might undermine China’s financial health.

Yifei’s remark highlights an earlier note released by Zhou Xiaochuan, the bank’s former governor, earlier this month. The note emphasized on cryptocurrency speculation and the supposed risks that digital currencies pose to the financial stability of China.

Furthermore, China’s Ministry of Public Security – an agency that manages China’s police force – released a note last January, stating that it will come down on crypto-related pyramidal schemes. Under this ministry, the Public Information Network Security Supervision agency released a report earlier this month that it has been intensifying on its internet scrutiny to monitor crypto exchanges that service local investors.

This is a further clamp down on cryptocurrencies which could possibly reduce their values.

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