The governor of China’s central bank struck a critical tone on cryptocurrency speculation during a media appearance on Friday.
Speaking at a press conference amid the Two Sessions, China’s annual political event, People’s Bank of China (PBoC) governor Zhou Xiaochuan took aim at cryptocurrency projects that have shifted away from their purported use cases in favor of promoting what is essentially market speculation.
“Lots of cryptocurrencies have seen explosive growth which can bring significant negative impact on consumers and retail investors,” Zhou said. “We don’t like (cryptocurrency) products that make huge opportunity for speculation that gives people the illusion of getting rich overnight.”
The comment may signal an increasing level of scrutiny down the road by the PBoC over initial coin offerings and trading services that are still available for domestic investors, even after regulators issued a ban on ICOs and essentially pushed fiat-to-crypto exchanges out of the domestic market.
It also follows recent measures reportedly taken by Chinese regulators to block social media channels offered by cryptocurrency exchanges that still provide trading services in the country.
That said, the central bank still holds what appears to be a positive view on blockchain development, and projects trying to bring genuine services to consumers. That position is also in line with the PBoC’s efforts to study applications of the tech through its digital currency research lab.
On Friday, Zhou called for those behind such efforts to be cautious – and not to grow too fast.
“For blockchain projects with technological potentials, they should conduct thorough testing before rolling out services. Otherwise, a reckless expansion may incur serious security and financial stability issues,” Zhou said.
PBoC image via Shutterstock
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