China introduces measures to manage the risks of stablecoins after the LUNA incident

According to Chinese government media, affected by the Luna incident, the government should put in place management measures for the risk of stablecoins to reduce space for illegal activities and related crimes. 

China will introduce measures to avoid the risks of stablecoins

The country has always tightened regulations on cryptocurrencies even though it is the 2nd most important Bitcoin mining location, just behind the US.

Despite a series of bans introduced, Bitcoin miners still operate stealthily. This regulation has sparked a wave of underground Bitcoin mining in China.

The collapse of LUNA has shaken the entire crypto investment community. LUNA, which has a market value of 41 billion dollars and hundreds of thousands of fans, plummeted. The price fell from almost $90 to almost zero in just a few days, tens of billions of dollars on the market. The market value of the US dollar evaporated instantly. Of course, the Chinese market also suffered a lot.

The country will also accelerate the completion of regulatory deficiencies and introduce targeted management measures for stablecoins risks to reduce further the space for speculation in virtual currencies, illegal financial activities, and related illegal and criminal activities.

Also, better defend Zhou Maohua, a macro researcher at the Financial Markets Department of Everbright Bank of China. Believe that due to differences in virtual currency regulation policies in different countries, it is easy making cryptocurrencies a channel for illegal cross-border transfers of assets.

China also wants regulators in different countries to develop standard global rules and strengthen cross-border supervision to prevent virtual currencies from becoming a tool for money laundering, fraud, and fraud. Illegal fundraising.

Recently, China’s anti-crypto regulations have forced the NFT Stepn game to exclude users from the mainland starting July 15. The event makes Stepn’s in-game crypto reported to have dropped 38% in a short time.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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