China’s crypto stance unchanged by the moves in Hong Kong

China unaffected by Hong Kong’s move

Recently, Hong Kong SFC (Security Futures Commission) announced the release of the crypto guidelines next month. Hong Kong is slowly adapting to crypto and making changes in its policies. Hong Kong also aims to become the next crypto hub leaving America behind. But it seems like China remains unaffected by the moves and policies of Hong Kong.

Crypto development and Adoption in Hong Kong did not soften China’s approach to regulating Bitcoin. Despite Hong Kong trying to be the next crypto hub, China is still firm on its anti-crypto stance in terms of local regulations. 

Some Chinese-affiliated banks have been opening bank accounts in Hong Kong in order to help crypto clients there. A firm backed by the China government and regulated as a Hong Kong entity launched two crypto funds in April. 

But the CPIC investment management CEO, Chenggang Zhou, stated that China no time soon is or will soften its Bitcoin regulations.

On May 5, Zhou stated that, no matter how many changes take place in Hong Kong, whether they adopt and promote Web3 or crypto, this will not cause any change in the Chinese regulatory regulations and the behavior of the government towards crypto.  

In defense of CPIC moves, Zhou said that, despite the Chinese government backing up CPIC, in the end, it is an independent Hong Kong entity regulated by the Security Futures Commission.

On asking about their involvement in crypto, the CEO said that Hong Kong policies and regulations allow us to get involved in crypto and hence they got involved. They didn’t breach any regulations or laws and this in no way means any change towards China’s government policies or regulations. Adding to it he said that before banning crypto in September 2021, China has maintained its anti-crypto stance for a long time now. And there is no chance that local governments are changing that in the near future.

Other people’s views

Zhou is not alone in thinking that China is and will remain anti-crypto. Lesperance & Associates founder David Lesperance says that it is hard to believe that China is not allowing its citizens to be involved in crypto despite seeing the Chinese government having tough times in the financial sector. 

Lesperance then added that China wants to increase its foreign currency deposits directly or indirectly. They are bifurcating to maybe shut out the local Chinese customers but to attract foreign customers. 

Lesperance further said that the crypto market in China is shut down and there is only one way in which Chinese clients can take their money out of China and that is by using Hong Kong’s crypto facilities. And the government would soon want to cover this leak. 

CPIC’s CEO Zhou mentioned that Hong Kong has strict KYC policies which restrict any Chinese investors on their platform.   

Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.

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