The chief of one of the biggest Chinese Bitcoin exchanges has penned a journal seeking regulations for the digital currency sector.
The article, written by Huobi’s CEO Leon Li, has arrived in the wake of growing regulatory uncertainties in the Chinese Bitcoin market, which — ironically and reportedly — hosts more than 80% of the world’s digital currency transactions already. This might be the first time when an industry’s representative has stepped up to speak in favor of Bitcoin regulation, in spite of knowing the China’s strict stand on the digital currency in past.
Li, however, aims to change just that — the perspective of the Chinese regulators towards the disruptive payment technologies like Bitcoin. In the article, he tried to introduce the virtual currency technology in the simplest manner, and further illustrated how it is being adopted by the world’s biggest economies, like the US and the EU, to create cheaper and secure payment systems.
Li further reminded how the Chinese Bitcoin industry, whose trading and mining operations are recorded to be the world’s highest, is still unable to add more local consumers due to the certain legal barriers. His comment was clearly on the People’s Bank of China which, in a draconian ruling last year, had banned local financial institutions from offering banking services to the Bitcoin businesses. Their notice had referred Bitcoin as a digital asset that promotes money laundering.
The definition of Bitcoin although has evolved much since the China’s ban. The digital currency is now more than just a payment method, thanks to its underlying technology blockchain. With institutions like Nasdaq, NYSE, and others joining the Bitcoin bandwagon, Li must be anticipating Chinese regulators to look at it from a fresh perspective. He, therefore, recommended PBOC to divide the regulations into two different part: one that focuses on payment, and other that focuses on the blockchain itself.
“Research into Bitcoin and blockchain should be encouraged and supported strongly,” he wrote. “Chinese regulators must look at how the other jurisdictions — like the US — are opening its mind towards creating better policies for the digital currency sector.”
“This would reduce certain risks for both businesses and consumers,” he added.