China’s Former Finance Chief Labels Crypto Vital to Digital Growth

The former finance minister of China, Zhu Guangyao, recently underlined how the Chinese government should reevaluate its position on cryptocurrencies in light of global trends. Speaking at a Tsinghua University-hosted seminar, Zhu emphasized the possible risks associated with cryptocurrency as well as its worldwide relevance.

Zhu added, “Crypto has negative impacts, and we must fully recognize its risks and the harm it poses to capital markets.” in order to emphasize the significance of understanding the hazards connected with cryptocurrencies. Even yet, he advocated for a more thorough analysis of changing international policies. Zhu thinks that cryptocurrency is essential to the growth of the digital economy and that China must keep up with global developments in this field.

His remarks were particularly influenced by statements from U.S. Republican candidate Donald Trump, who argued that America must “embrace the crypto industry fully, or China will do it.” Speaking at the Bitcoin Conference in Nashville, Trump compared the crypto industry to the steel industry of 100 years ago, predicting it could one day “overtake gold.” Zhu saw this as a signal for Beijing to closely study the growing importance of cryptocurrencies on the world stage.

Contrasting Approaches Between Mainland China and Hong Kong

Hong Kong has adopted a different stance on cryptocurrencies, while China continues to be cautious. Hong Kong, a semi-autonomous area with its own market laws and government, has welcomed cryptocurrencies more enthusiastically. It has launched exchange-traded funds (ETFs) for bitcoin (BTC) and ether (ETH), a move supported by some local MPs who want to draw cryptocurrency companies to the city. Zhu further emphasized that, in spite of early opposition, the U.S. Securities and Exchange Commission (SEC) had authorized bitcoin and ether ETFs, indicating a transformation in the world’s financial markets.

Zhu’s advice to China in response to these events was crystal clear: in order to be competitive in the digital economy, learn more about cryptocurrency, understand its hazards, and keep up with global trends.