Central Bank Chief Warns Cryptocurrencies Could Impact Financial Stability

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The head of the People’s Bank of China has expressed concern about the potential impacts of the “excessively rapid and insufficiently cautious” emergence of cryptocurrencies such as Bitcoin.

Speaking at a press conference held on 9 March in tandem with the 13th National People’s Congress, Zhou Xiaochuan said that if cryptocurrencies see “rapid expansion or spread, there is the possibility that this will create highly adverse impacts for consumers, which will perhaps also spread to financial stability and monetary policy, producing unforeseen results.”

According to Zhou Bitcoin and other similar products have “emerged too quickly, with insufficient caution.”

“If technological progress brings changes to the original financial order, then we need to be more cautious about undertaking research, and unveil it after undertaking discussion.”

Given that technological progress is a “dynamic process,” Zhou said that he cannot speak with uncertainty about what specific types of fintech regulatory policies China may introduce in future.

For this reason Zhou views China’s regulation of cryptocurrencies as also being “dynamic,” and to be determined on the basis of technological maturity, as well as monitoring and assessment.

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