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No one can refuse China’s digital currency, says central bank exec

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China’s central bank digital currency (CBDC) known as the digital yuan should be regulated in line with cash-related laws, according to a senior exec at the country’s central bank.

In an opinion article on Sept. 14, Fan Yifei, a deputy governor of the People’s Bank of China (PBoC), outlined the major regulatory principles for the operation of the digital yuan. the digital representation of the official currency of the People’s Republic of China.

According to Fan, the digital renminbi is legally compensatory to the traditional fiat currency. In the article, the deputy governor outlined that the digital RMB is “mainly positioned” as M0, which means that the digital currency is part of the supply of paper notes and coins. As such, the digital RMB “needs to comply with laws and regulations related to cash management”, Fan said.

The deputy governor went on to say that according to the renminbi’s indemnity provisions, the digital renminbi could be used to pay “all public and private debts within the territory of our country.” Fan emphasized that the digital currency should be accepted everywhere in the country, and “no unit or individual may refuse to accept it if the conditions are met.”

Fan also said that the digital renminbi must comply with laws and regulations on cash management, Anti-Money Laundering and combatting terrorist financing.

The digital yuan is reportedly being piloted in a number of regions in China including Beijing, Tianjin, Hebei, as well as the Hong Kong Greater Bay area. In late August, Reuters reported that the PBoC is planning to use the digital currency at the 2022 Winter Olympic Games.



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Regulation

Bipartisan bill to study blockchain and crypto passes US House of Representatives

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A bipartisan bill that requires the study of blockchain technology and digital tokens passed the House of Representatives on June 22.

The “Consumer Safety Technology Act” is centered on consumer protection and includes digital token and blockchain research. The bill passed the 117th Congress within a week of its introduction, with a resounding 325 votes in favor of, and 103 votes against.

This is not the first time this bill has reached this point however, and under the Trump administration, the bill passed the House in September 2020. It was then referred to the Committee on Commerce, Science, and Transportation before being shot down in the Senate.

Among other things, the bill calls for the Consumer Product Safety Commission to deploy a pilot AI program to aid consumer safety inspections, such as identifying consumer product hazards and tracking trends related to injuries involving consumer products.

Additionally, it calls for the Secretary of Commerce and the Federal Trade Commission (FTC) to “study and report on the use of blockchain technology and digital tokens.”

Democrat representative for California’s 9th district, Jerry McNerney sponsored the bill, which was co-sponsored by Democrat Darren Soto, along with Republicans Warren Davidson, Van Taylor, Michael Burgess, and Brett Guthrie.

The Consumer Safety Technology Act also includes two other bills touching on crypto. One is the Blockchain Innovation Act along with parts of the Digital Taxonomy Act which mandate the FTC report on “unfair or deceptive acts or practices in transactions relating to digital tokens.” Rep. Soto first introduced the latter bill in April 2019, but did not receive a single vote at the time.

Both bills are aimed at stopping deceptive acts related to crypto from individuals and “unscrupulous companies.”

Related: Will regulation adapt to crypto, or crypto to regulation? Experts answer

On the House Floor, Soto emphasized the importance of ensuring consumer protection from volatility and crim:

“When we look at market volatility, the use of cryptocurrency for ransomware, and recent attacks like the Colonial Pipeline and tax evasion, it’s critical that we get on the front end of this.”

The Blockchain Innovation Act requires the study of investment trends in the crypto industry, the potential risks and benefits of blockchain tech designed for consumer protection, and areas in which regulation could foster domestic innovation.