Former Finance Vice-Minister Urges China to Reconsider Crypto Stance Amidst Evolving U.S. Policies: The Crucial Role of Cryptocurrencies in Digital Economy

Ex-Chinese finance authority pushes for crypto studies as US eases its position

Zhu Guangyao, the former deputy minister of finance, labelled cryptocurrencies as an 'essential element for the growth of the entire digital economy'

Cryptocurrencies play a vital role in the digital economy, and it's important for China to keep pace as the US starts to welcome this sector, says a previous high-ranking official from the Ministry of Finance. This comes as a growing number of specialists publicly encourage the Chinese government to reconsider its prohibition on these digital assets.

The approach to cryptocurrency regulation in the United States has seen a "major shift" this year, according to Zhu Guangyao, who previously served as China's deputy finance minister. Speaking at an economic forum in Beijing on Saturday, he suggested that China should closely observe these changes and other international policy trends affecting the sector.

Despite the potential dangers and detrimental effects cryptocurrencies might have on the capital market, they also play a vital role in the progress of the overall digital economy, he further stated.

Zhu, who served as the deputy head of the finance ministry from 2010 to 2018, is part of a rising number of Chinese economists urging Beijing to reassess its prohibition on cryptocurrencies within the country, especially in light of global growth in recent years.

In 2017, Beijing initially prohibited initial coin offerings and mandated the shutdown of cryptocurrency exchanges. This suppression escalated in 2021, as they outlawed bitcoin mining and declared businesses involved in cryptocurrency to be unlawful. Chinese officials view cryptocurrencies as a potential hazard to financial security and a hotbed for illicit activities.