Over the weekend, signs of positive sentiment have entered the cryptocurrency market, with Bitcoin potentially having found its footing and many altcoins surging with confidence. However, news out of China is aiming to rain on the parade — as the People’s Bank of China looks to crack down further on Bitcoin while creating its own digital currency.
People’s Bank vs. People’s Currency
According to various reports, the People’s Bank of China (PBOC) plans on placing stricter regulations on Bitcoin and other cryptocurrencies while the country’s central bank explores the creation of its own digital currency.
The vice governor of the PBOC, Fan Yifei, stated:
First, we will intensify reforms and innovations to promote the central bank’s digital currency research and development; Second, the bank must strengthen supervision and rectify all types of virtual currencies.
According to Investing.com, the PBOC’s director general of financial research has also pushed the central bank to develop its own digital currency as quickly as possible, claiming such a product would help solve interest rate issues caused by cash. He stated:
In the long run, due to the lower natural interest rate, monetary authorities can incorporate negative interest rate policies into the normal monetary policy toolbox.
Sun Guofeng, the director general of financial research for PBOC, agrees that the creation of a central bank-sponsored digital currency is a top priority, stating:
While the central bank’s digital currency is conducive to the implementation of negative interest rate policies, the central bank should speed up the development of a central bank issued digital currency.
Despite this news from China, early signs of renewed investor confidence are starting to show their faces in both the Bitcoin and wider cryptocurrency markets.
At the time of this writing, Bitcoin (BTC) has largely held steady as investors wait to see whether or not it will explore further lows. Meanwhile, Ethereum has bounced back 7.21 percent over the last 24 hours.
Most interestingly, NEO — often called the ‘Chinese Ethereum’ — is up 15.23 percent, perhaps due to speculation regarding the platform’s positive future in the restrictive country. However, a high-profile token offering for NEX, a decentralized cryptographic trade and payment service creation platform, is also likely driving NEO sales.
What do you think of China’s push to create it’s own digital currency while taking action against Bitcoin and other cryptocurrencies? Let us know in the comments below!
Images courtesy of Bitcoinist archives, Adobe Stock.