China Passed A New Law Regulating Crypto, Taking Effect In 2020

China passed a new law that will regulate the crypto sector which will take effect on January 1, 2020, according to the reports that we have in our cryptocurrency news today.

The standing committee of the 13^th National People’s Congress in China passed the new law that aims to set standards for the application of cryptography and the management of passwords. The new regulatory framework established the role of a central cryptographic agency which will lead the public cryptography work, creating guidelines and policies for the industry.

The draft of the law was published on May 7 by the Chinese news outlets and according to the texts, we can read that it is mostly focused on the government centralized passwords management and does not explicitly mention cryptocurrencies although it does focus on cryptography which is a key component underpinning cryptocurrencies such as Bitcoin. Wan explained:

 “The key take away is — the developing of new cryptography, hashing algo, even the usage of the tech, will be in the official legal realm. This means you need to follow the CCP standard for all ‘encrypted’ behaviors, which can be VERY broad, from mining to block propagation.”

She concluded that the latest law is building the foundation for the upcoming national cryptocurrency of the country but there was no official timetable for the launch as one Chinese official confirmed in September. As was reported yesterday, China’s President Xi Jinping called the country to accelerate its adoption of blockchain technologies which caused a massive spur on the markets leading all altcoins to get an upswing in price and especially bitcoin.

In the meantime, over the past week, the Facebook CEO and founder Mark Zuckerberg warned that the Chinese superiority in the digital space will kick out the United States off the game and will put the US dollar at risk in an attempt to sell lawmakers his plans for the Libra stablecoin. He warned:

“China is moving quickly to launch a similar idea in the coming months. We can’t sit here and assume that because America is today the leader that it will always get to be the leader if we don’t innovate.’’