Zhu Guangyao on Cryptocurrency Development and Policy

Zhu Guangyao, China’s former vice minister of finance, called for further study of cryptocurrency developments and relevant international policy shifts during a recent finance forum in Beijing.

Key Points

• Zhu acknowledged the negative impacts of cryptocurrencies, emphasizing the need to recognize their risks and harms to capital markets.
• He stressed the importance of understanding international developments and policy changes, particularly the influence of U.S. bipartisan policies, for the digital economy’s evolution.
• His remarks were made at the Tsinghua PBCSF Chief Economists Forum, attended by leading economists, researchers, and former officials.

Background

In September 2021, the People’s Bank of China along with other authorities banned all crypto trading on the mainland, labeling overseas exchanges providing services to Chinese residents as illegal. Nonetheless, some investors continue to evade these restrictions.

Zhu noted that the U.S. appears to be shifting its stance on cryptocurrency, with the Republican party supporting it in its presidential campaign. He pointed to the recent approval of spot crypto exchange-traded funds in the U.S. as indicative of a fundamental policy change.