China to Pass New Cryptocurrency Rule by Next Year

China to Pass New Cryptocurrency Rule by Next Year

According to a news report by CCTV on the 26th of October, the Standing Committee of the 13th National People’s Congress in China has approved a new rule to govern cryptography in the country. This new rule will become effective as from the 1st of January 2020.

According to the report by the local news network, the rule was composed to set benchmarks for the use of cryptography and the management of passwords. The new governing model defines the role of a fundamental cryptography agency; to direct public cryptography activities thereby formulating strategies and systems for cryptography space.

How the New Rule Affects Cryptocurrency
The outline of the rule was publicized back on May 7 by a news agency in China. The article is heavily centered on government centralized password management. Although it doesn’t explicitly mention cryptocurrency, it is centered on cryptography which is a major support provider for cryptocurrencies like Bitcoin.

A member of Congress explained that the development of cryptography, hashing algorithm and the use of these technologies will cover the entire jurisdiction. What this means is that the CCP benchmark has to be obeyed for all encrypted activities such as mining and block propagation.

China’s Forthcoming National Stablecoin
The Congress member mentioned that the new rule is important in developing a foundation for the impending native Chinese cryptocurrency. However, there is no official release date for the cryptocurrency yet.

Also, in a recent news release, the president of China, Xi Jinping has urged the nation to hasten the adoption rate of blockchain technologies.

Meanwhile, Mark Zuckerberg, in a bid to gain lawmakers’ support for his Stablecoin Libra, has advised that China acquiring supremacy in the cryptocurrency sector could spell doom for the sovereignty of the US dollar. He said that China is increasing its pace to release an identical product in a few months and that they couldn’t just sit back and assume that the current status of the United States as the worlds’ supreme nation would still stand if they failed to innovate.

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Author : Azeez Mustapha

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Azeez Mustapha is an experienced author, trader, markets analyst, signals strategist, and funds-manager.