The rapid adoption of cryptocurrencies like Bitcoin (BTC) poses a major challenge to the traditional financial system, warned an executive at China’s central bank.

Wen Xinxiang, director of payments and settlement at People’s Bank of China (PBoC), expressed concern about the growing popularity of cryptocurrencies and fiat-linked stablecoins.

Wen pointed out that the market value of Bitcoin has now exceeded $ 800 billion and the total market capitalization of stablecoins exceeds $ 120 billion, and addressed the main risks related to the crypto market at a liquidity forum. Settlement and settlement on September 24th, the Shanghai Securities Journal reported.

According to the official, one of the main challenges facing cryptocurrencies is that the industry is able to operate in isolation from the traditional payment system supported by commercial banks and payment institutions. According to Wen’s report, cryptocurrencies are also causing problems for banks’ payment services and weakening the power of clearing houses.

Wen also argued that the alleged anonymity of cryptocurrencies makes it an attractive tool to facilitate illegal transactions such as money laundering, and called for more measures to be taken to prevent the system from doing so. Traditional finances compete with cryptocurrencies:

“The challenge of cryptocurrencies is huge. As the traditional financial system grapples with competition from large tech companies in the financial industry, it can also rely on traditional methods such as legislation and oversight to aid antitrust efforts and improve privacy and privacy. “

Related: New decentralized stablecoin in China targets international trade

Wen’s comments further reinforce the Chinese government’s anti-crypto stance as China continues to crack down on crypto trading and mining this year, with local authorities shutting down many sites.

PBoC Deputy Governor Fan Yifei had previously voiced concern about stablecoins in July, saying the growth rate of the private payments system was “very alarming.” Despite the Chinese government’s skepticism about stablecoins, some domestic players are experimenting with decentralized stablecoins pegged to China’s digital central bank currency, the digital yuan.