According to reports, the CAC (Cyberspace Administration) of China has implemented new regulations over Blockchain-based firms currently operating in the country. This is a move by the Chinese authorities to further strengthen its oversight over the sector. The announcement was reportedly published on the CAC’s website this Thursday, January 10.
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Authorities Will Have Access to Stored Data and Launch Registration Processes Under the New Regulations
As per the stipulations on the CAC regulations, the guidelines, which are going to be in effect from February 15 2019, were designed to contribute to a healthy sector and encourage the development of the Blockchain industry.
The document indicating the terms or a new set of regulations describes the Blockchain firms operating in the country as subject to the regulations as sites or mobile applications that provide data and technical support to members of the public using the Blockchain-related technologies. According to the report, as soon as the new regulations come into effect, the company’s will be under obligation to register their names, server addresses and domains at the CAC in a 20-day period.
The new guidelines also require Blockchain startups in China to give authorities access to their stored data and introduce a registration protocol that would require the ID or mobile number of its users. Additionally, these companies will be obligated to oversee content and even sensor any data that is prohibited under the current Chinese legislation.
October Draft, Motivation Behind New Blockchain Regulations
If a Blockchain-based startup or entity operating in the country fails to comply with the new regulations, said firm might face fines running to the tune of 20,000 to 30,000 Yuan (which is equivalent to $2,900 to $4,400, respectively). In the case of serial offences, under the new regulation, the company may face criminal indictment.
China first released draft guidelines in October for blockchain companies, which also contained recommendations that sought to eliminate anonymity in the blockchain.
At the time, Asian newspaper The South China Morning Post wrote about an anonymous open letter that alleged sexual harassment at a top Chinese university that was published on the Ethereum (ETH) blockchain in April. The media outlet believes the publication of the letter could be a motivation behind the new regulations.
China Piloting Blockchain-Based Solutions in the Regions
China is reportedly currently piloting its Blockchain legislation in just three major regions across the country including Beijing, Shanghai and Guangzhou. We can recall from a December report by the local finance publication outfit, Securities Daily, that they are 11 Blockchain-based policy projects in the areas above. The new legislation will ease things and streamline the country’s Blockchain ambitions.
In the meantime, the Asian country has reportedly upheld a de facto ban against the domestic trading of digital currency first implemented in 2017. This regulation was completed in February last year when the government decided to include international crypto exchanges and ICO (initial coin offering) sites to its Great Firewall. The People’s Bank of China approved this decision by the government. Apart from China’s central bank, financial regulators within the Asian territory also welcomed the legislation