China’s Hainan Disentangles Itself from Crypto Space While Digital Assets are Allowed
China’s Hainan recently issued a statement to standardize blockchain-related business, which requires all relevant enterprises shall not engage in illegal financing activities of token issuance, engage in the exchange transaction between fiat money and cryptocurrency after the previous encouragement to blockchain industry.
The statement emphasizes any enterprise shall not trade in or act as a medium for crypto trading as well as providing services such as pricing and information intermediary, referring to those market makers, service providers, media and platform institutions.
The statement actively guides the settled enterprises to strengthen self-discipline, standardize industry behavior, and form good development atmosphere, and those who have violations of laws and regulations should be reported in a timely manner and cooperate with relevant departments to resolutely crackdown.
As the previous statement shows, Hainan encourages leading enterprises to explore the construction of digital asset trading platform, the standards and technical models in digitalization, digital asset right confirmation and protection, global flow of digital assets, and digital asset trading. The statement also promotes the first trial of digital asset related businesses in Hainan, and explore the “blockchain + financial sandbox supervision mechanism”. After approval, financial enterprises can carry out blockchain innovative products, services, business models and transmission mechanism tests in sandbox. ”
Apart from the fact that there is no progress in the standardization of trading platform and currency issuance, the biggest problem is that the boundary of cryptocurrency is not clear enough. For example, whether the bonus based on blockchain and free trading is cryptocurrency; whether the token of digital asset securitization is a cryptocurrency, these two are also the items that Hainan hopes to promote in the previous documents.