BEIJING, China—China’s congress has passed a cryptography law it says is designed to promote crypto development and ensure sound cybersecurity, reports indicate. Some analysts have suggested China’s real goal is to be able to track every citizen’s spending more closely.
The law will regulate the use of cryptography, facilitate the cryptography business and establish cybersecurity, Pymnts.com reported.
According to the law, “the state encourages and supports the research and application of the science and technology in cryptography and protects the intellectual property rights in cryptography.”
The decree also underlines the training of talent in cryptography and will offer awards for “outstanding contributions.”
Other Aspects of Regulation
Under the new regulation, cryptography will be organized into commercial crypto, as well as core and common, which will be governed by special authority and utilized to keep national secrets secure, Pymnts.com said.
A research team was established in 2014 by China’s central bank to explore launching a digital currency and increase China’s control of the money supply.
The digital currency is expected to be like Facebook’s Libra coin and used across payment platforms such as WeChat and Alipay, a senior central bank official said last month, Pymnts.com reported.
The announcement came one day after Chinese President Xi Jinping called on the country to seize opportunities in blockchain technology.
David Marcus, the executive in charge of Facebook’s proposed digital currency, said if Libra fails, the U.S. could fall behind China in the race for legitimized cryptocurrency, and subsequently in influence around the world, Pymnts.com noted.