Banking Regulator Study Suggests ICO, Trading License in China
A working paper published by the China Banking Regulatory Commission (CBRC) suggests regulators in the country issue licenses to crypto-related activities such as initial coin offerings (ICOs), to let them operate with compliance.
Researchers from the CBRC – Li Wenhong and Jiang Zeshen – published the working paper on Wednesday entitled “The Study of Development and Regulations on Distributed Ledger Accounts, Blockchain and Digital Currency.”
Fully dedicated to regulatory studies on cryptocurrency, the paper summarized a variety of legal efforts made by different jurisdictions to govern activities related to blockchain, cryptocurrency, derivative trading as well as ICOs.
Commenting on how China should move ahead on the subject, the authors shared their suggestions in the paper:
“Currently, any capital transaction that relates to distributed ledger accounts, blockchain, cryptocurrency and its derivatives, ICOs and exchange operations should all be regarded as financial services. Therefore they must be put under relevant financial regulatory frameworks so that they can operate legally with a license.”
Though the paper states comments made by researchers don’t necessarily represent the institution’s stance, the suggestion is still notable given Chinese regulators have not mentioned in any capacity its thinking on a cryptocurrency license.
In addition, the paper suggests a potential framework for crypto-related activities should not be limited to just ICOs and trading. Rather, it should apply to any service that deals with transactions “related to distributed ledger accounts.”
As previously reported by CoinDesk, the clampdown from the People’s Bank of China along with six other regulators – including the CBRC – last year stated that ICOs and fiat-to-crypto trading are prohibited because they were unlicensed financial activities. Yet since then, the regulators have not indicated whether or how it may consider a licensing framework for cryptocurrency activities.
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