One of the high ranking officials at China’s apex bank, Gou Wenjun, has offered the bank’s services in monitoring the Metaverse and NFT space. Wenjun implied this while delivering a speech at the financial security summit stating that it is risky not to regulate activities in the NFT and Metaverse.
Combating Financial Fraud Remains The Aim – Wenjun
Wenjun opined that it is inevitable that some people would use this new trend for illegitimate means the same way they would use it for legitimate purposes. He further said that there should be stricter governance measures over this fast-rising sector of the crypto ecosystem because their use for illicit financial purposes is very high. Hence, Wenjun’s proposal is to establish a supervisory body that can oversee how digital assets are deployed transparently and responsibly.
He further proposed that Chinese financial watchdogs should tone up how they monitor crypto-related transactions. Any financial institution that offers cash-to-crypto services must be mandated to validate all parties involved in each transaction. Also, the government should assist these financial institutions with tools to identify fraudulent transactions.
Wenjun suggests the application of technologies such as machine learning and artificial intelligence in developing tools that can help these financial institutions. He further proposed a coalition between all financial regulators and watchdogs in all regions of the world to jointly prevent or identify crypto-related financial frauds. “In the meantime, our anti-financial fraud unit will continue to work with some financial watchdogs already working with us to improve how we retrieve and analyze information,” he concluded.
Evading Sanctions Through Cryptocurrencies
The launching of various national digital currencies (notably, the e-yuan) recently has increased the awareness and adoption of digital assets. In a recent interview, the deputy secretary to the US treasury department (Wally Adeyemo) stated that the authorities would not be partial in their crypto sanctions because of the issuance of the e-USD.
Adeyemo made his remarks seem like a response to Oleg Deripaska (a popular Russian multi-billionaire), who advised that Russian authorities use BTC to reduce the influence of the USD and escape US sanctions. The Russian oligarch also remarked that “American authorities are doing everything they can to undermine the crypto space through stringent policies because they know it can topple their financial ecosystem as they know it and weaken the USD significantly.”
China Hellbent On Destroying Crypto
Despite banning all crypto-related activities earlier this year in a move that prompted the shut-down of several BTC mining companies, it appears that Chinese authorities are still not satisfied. They want to dictate what happens in the Metaverse too. It continues to implement stringent laws against private companies in the name of protecting investors.
Many Chinese crypto analysts claim that the Chinese ruling party will oppose and destroy any idea that would give power to Chinese consumers. While some governments are embracing the crypto community, some are repelling them, and some are undecided on what to do. There is more to an acceptable crypto regulation than doing the opposite of what China does, but it starts from there.