China's Legal Daily, a publication of the Political and Legal Affairs Commission of the CPC Central Committee, recently emphasized the need for stricter measures against corruption involving cryptocurrencies and other electronic payment methods. Legal scholars at the annual conference of the China Society for Integrity and Law highlighted the urgency of addressing new forms of corruption.
The publication quoted Zhao Xuejun, an associate professor at Hebei University Law School, who noted on January 1 that virtual currencies and electronic gift cards are emerging as covert channels for bribery. He pointed out that these digital assets, often stored in "cold storage" devices, can be easily transported and exchanged abroad, making them a convenient tool for corrupt practices.
The Chinese Communist Party (CCP) is reportedly intensifying its efforts to combat corruption, according to Zhao. Meanwhile, Mo Hongxian, a professor at Wuhan University Law School, emphasized the challenge posed by the anonymity and traceability issues of virtual currencies like Bitcoin. He acknowledged that while these currencies are not officially recognized in China, they still demand judicial oversight due to their potential for illicit use.
The article concluded with a call to enhance the legal and regulatory framework to effectively tackle new forms of corruption. This involves broadening the definition of bribery crimes and bolstering information supervision in areas susceptible to such modern corrupt practices. This publication came shortly after warnings from the Supreme People's Procuratorate and the State Administration of Foreign Exchange, cautioning officials against using the stablecoin Tether RMB for illegal foreign exchange transactions.
Despite its firm stance against cryptocurrencies, China continues to embrace blockchain technology for various applications, including identity verification. The country's e-CNY central bank digital currency, though still in its pilot phase, is showing significant progress. As of June 2023, the digital yuan has facilitated nearly $250 billion in transactions, including international merchandise sales, despite its limited geographic distribution.
