China’s Crypto Stance Unmoved Despite Hong Kong’s Progress

•China has maintained an anti-crypto stance for some time, even before banning crypto entirely in 2021.
•Despite Hong Kong progressing with cryptocurrency adoption, mainland China has not changed its regulations.
•CPIC Investment Management CEO Chenggang Zhou emphasizes that despite China government’s backing, CPIC Investment Management operates as a Hong Kong entity regulated by the Securities and Futures Commission.

China’s Unchanging Crypto Stance

China has maintained an anti-crypto stance for some time, even before banning crypto entirely in 2021. Despite progress being made in Hong Kong with cryptocurrency adoption, mainland China has not changed its regulations on the matter.

CPIC Investment Management

CPIC Investment Management is a China government-backed firm regulated as a Hong Kong entity and launched two cryptocurrency funds in April of 2021. CEO Chenggang Zhou emphasizes that despite China government’s backing, CPIC Investment Management operates as a Hong Kong entity regulated by the Securities and Futures Commission and there is no indication that the Chinese government will be changing their stance or policy on cryptocurrencies any time soon.

Opening Bank Accounts For Crypto Clients

Some Chinese state-affiliated banks have increasingly opened bank accounts to serve crypto clients in Hong Kong. This does not mean that China has softened or will soften its approach to regulating Bitcoin anytime soon according to Zhou. However he adds that “Hong Kong regulations allow us to invest in different markets or asset classes or products like cryptocurrencies so we’re not breaching any regulations or laws.”

David Lesperance’s Viewpoint

Lesperance & Associates founder David Lesperance believes that it is hard to imagine that China would loosen its control over the ability for Chinese nationals to use crypto due to them wanting “to increase its foreign currency holdings”. He further states: “Given that the Chinese government is coming down hard on the financial sector, it is hard to imagine that China is loosening its control over the ability for Chinese nationals to use crypto.”

Conclusion

In conclusion it appears unlikely at this time given current policies and attitudes towards cryptocurrency in mainland China, particularly with regards to foreign currency holdings and control over national usage of cryptocurrencies, that they will change their position regarding cryptocurrencies anytime soon.