Despite an Obvious Coyness, Chinese Government Officials Seem Open to Crypto

Whenever you think of cryptocurrencies in China, there is quite a lot for you to wrap your head around. However, one of the most significant talking points is usually the fact that the Chinese government seems not to be interested in cryptocurrencies themselves at the moment. 

However, it is possible that the belief of China being dismissive about cryptocurrencies might not be true. Last week, tech news medium Decrypt published an account of the 2019 Shanghai Wanxiang Blockchain Conference, noting that the perception of cryptocurrencies from some top government officials wasn’t so negative.

Let’s talk crypto

The conference was attended by about 2,000 people, and it featured panel discussions and appearances from some big names in the Chinese crypto and blockchain space.

Some attendees included Vitalik Buterin, the co-founder of Ethereum, as well as Chinese government officials such as Li Lihui, head of the Blockchain Research Working Group at the National Internet Finance Association of China, and Dr. Yao Qian is the Chief Executive Officer of China Securities Depository and Clearing Corporation Limited (CSDC). 

All of these government officials, according to Kong, seemed rather open to the topic of cryptocurrencies and how they could play a role in the Chinese economy. Panel discussions included Libra (the stablecoin project from social media giant Facebook), Central bank digital currencies, open finance, and much more.

Careful nomenclatures

However, the reporter also notes that the panelists seemed to be rather deliberate with their connotations, as they used the word “digitization” in place of “tokenization.”

In his panel speech, Li Lihui reportedly said that the need for digital assets is significant, especially if the Chinese digital finance space hopes to thrive. Kong noted that he reportedly added the need for China to open its economic infrastructure, thus embracing the use of digital assets. 

However, given the nuances of tokenization and digitization in China, as well as what the current Chinese stance is on crypto tokens and Initial Coin Offerings (ICOs), it is understandable that the government officials would be careful with they say.  

For now, however, while the officials seemed to be open to granting discussions on crypto assets, cryptocurrencies and ICOs themselves are still banned in China. Since they were more or less outlawed in 2017, there have been signs that a reversal of that stance could be in the cards. However, nothing of such as materialized yet. 

It is also worth noting that several reports have alluded to China building its own state digital currency. Many believe that this could be why Bitcoin remains illegal in the country, even though its environment seems rather conducive for cryptocurrencies’ use and growth.

Whether or not this materializes, the country still has the crypto mining sub-industry to brag about. China accounted for about 70 percent of the global Bitcoin mining activity back in May, and the activity has continued to thrive in the country regardless. 

It is possible to argue that legalizing cryptocurrencies would be even more beneficial to China, especially given how much mining has been able to thrive there. However, until the government chooses to lift the ban, all we can make do with will be the continuous innuendos.