The Chinese central bank has called for greater regulation of the application of blockchain technology in the financial sector.
Chen Liwu (陈立吾), vice-head of the People’s Bank of China’s (PBOC) technology department, said that China must establish new regulatory mechanisms that specifically target blockchain technology.
“The application of new technologies such as blockchain are increasing the efficiency of financial services and reducing service costs, while also triggering new risks,” said Chen.
“[We] need to explore the establishment of regulatory mechanisms for innovative applications of blockchain technology to finance, and guide financial institutions in analysing application scenarios with reference to their own unique conditions.”
Chen made the remarks on 17 December at the 2019 Third China Internet Finance Forum (2019第三届中国互联网金融论坛).
According to Chen the regulation of new blockchain innovations will include the establishment of risk prevention and control mechanisms and compensation mechanisms.