- Cryptocurrency is relatively a new concept for most people and financial markets.
- About 70% of the blockchain companies have issued their own tokens and only around 4000 of the approximately 25000 have been involved in blockchain applications.
- The Chinese government has issued a heavy breakdown on the operations and looked into closing most of the cryptocurrency firms.
Blockchain has started finding its way to the top of the institutionalized scheme of things. Cryptocurrency is relatively a new concept for most people and financial markets. It wasn’t something that was accepted as being part of conventional investing or financial transactions.
However, due to its potential and current form, there are various countries that are considering their potential. More specifically China has shown interest in cryptocurrency and recognized it. Led by the Chinese central bank five financial and technological authorities established the bluebook on the blockchain on Thursday last week pointing out the illegalities and fraud potential of the blockchain network.
In the country, about 70% of the blockchain companies have issued their own tokens and only around 4000 of the approximately 25000 have been involved in blockchain applications. The ICO which was the main issuer of crypto usage is not allowed to issue anymore however it still manages mining operations and assets.
The Chinese government has issued a heavy breakdown on the operations and looked into closing most of the cryptocurrency firms. This isn’t an attack on the cryptocurrency but on the manipulation and fraud that can come as a result of it. By tightening the lid, it makes sure that the cryptocurrency is regularised and kept a check on.
Considering this form of acceptance is unprecedented it will require a closer look and control. The government policy is very strict and straight forward it looks at shutting down all unauthorized and unregulated crypto exchanged and even firms that promote this kind of activity will be dealt with seriously. It is good that the Chinese government is breaking down so heavily on such activities.
This shows the intention of the government is serious towards taking up this cryptocurrency as an actual medium. The government looks to curtail fraud and not have any mass scam taking place. The bluebook has three parts. The first deals with how to deal with the emerging fin-tech industry and the other two focus on technologies used by the regulators and financial technologies.
The government’s initiative is positive it provides the right path towards normalization of the cryptocurrency and blockchain technology. It’s important that other countries take up the same path or something similar to this as it makes regularisation easier and makes cryptocurrency safer.