"Learning Times" article: Libra coins pose challenges to cryptocurrency regulation

Libra, a global cryptocurrency project released by technology giant Facebook's joint partners, has sparked heated debates. Most of the discussions have focused too much on divergent macro-concepts, but they are decoupled from financial logic and regulatory reality, and have a viable regulatory response. The measures are naturally difficult to generate, and it is necessary to propose feasible regulatory recommendations based on the reality of the cryptocurrency market. There are two ways for Chinese users to participate in Libra: first, to purchase Libra directly using legal currency funds; second, to pay the Libra Association to become a verification node. The former is mainly for retail users (to C), while the latter is for companies (to B), the former is potentially more risky.

Financial regulation has severely restricted the cross-border transfer of bank account funds in China, but in the blockchain system, the process of bank transfer can be completed in one country, and the transnational transfer is completed by the cryptocurrency trading platform, which is more effective than bank review. Avoiding financial controls for loose Internet information review.

Regulatory means for cryptocurrencies such as Libra

Libra, which is endorsed by technology giants and widely concerned by the society, has spurred lawless elements to commit fraud. Therefore, it is necessary for the regulatory authorities to rely on authoritative channels to convey objective facts to the society and guide public opinion. The following can be carried out in the following aspects.

Punish illegal activities and strengthen investor education. At present, various types of WeChat community, Weibo, knowledge planet and other online media channels are filled with a large number of cryptocurrency transaction information and induce investors' behavior. The network supervision department can cooperate with the Internet service provider to find out the illegal behaviors that may exist, and require them to rectify or shut down on the basis of grasping the principle of proportionality of administrative means. In some countries, digital assets are mainly placed under the supervision of securities laws. On the website of the regulatory authorities, there are many cases of penalties for improperly promoting cryptographic currency speech and issuing cryptocurrency without permission. The punishment is extremely strict and has played a good role in society. Guidance role. China should strengthen the authoritative rational analysis of cryptocurrencies and digital assets.

Using the trading platform as a catcher to pass the regulatory effect

The trading platform is the key and leader of the entire cryptocurrency transaction. It almost holds the voice of the cryptocurrency industry. The regulation of the trading platform can effectively pass the regulatory policy effect to the cryptocurrency market participants, but at the specific regulatory level. Grasp the impact on society and the difficulty of implementation.

Supervise the head trading platform under the principle of proportionality. The cryptocurrency market suffered a setback, and a large number of domestic investors sold cryptocurrencies based on policy panic. Since there are still a large number of cryptocurrency investment channels after the implementation of the regulatory policy, the overseas capital has used the chips obtained from the previous panic slump to sharply increase the cryptocurrency price again. The influx of domestic investors has once again induced market risks. For the head trading platform, it is not appropriate to take the time to attack, but to impose strict regulatory requirements in internal communication. The regulatory policies on the trading platform need to be further tightened.

Strict small and medium trading platform supervision and enforcement. A large number of small and medium-sized trading platforms have a small number of operators and a very low level of professionalism. The criminals regard the investor's principal as a target (the folks call it "killing pigs") and involve serious crimes. The supervision of these trading platforms does not require separate regulatory rules. The current regulatory policies and criminal laws are sufficient to include them in the supervision. It is also a wake-up call for the head trading platform to sort out the typical cases to combat defamation.

Improve and implement the Regulations on the Management of Blockchain Information Services

The Regulations on the Management of Blockchain Information Services (hereinafter referred to as the "Regulations") issued by the Network Information Office has a significant effect on China's blockchain technology enabling entities and regulating market order, but there are also some shortcomings. The "Regulations" mainly regulate the use of blockchain technology to provide information services, that is, the "chain information" of the blockchain is regulated, which is consistent with the technical realization of the blockchain. However, almost all illegal and criminal acts related to blockchain are realized through “internet information” such as the Internet and self-media. Therefore, there is a certain deviation in the direction of the application of domestic blockchain technology in the Regulations, which may not be understood. The real situation of the market, but also the rules are too strict and not conducive to the development of technology.

The legal responsibility of some trading platforms to evade “credit intermediary” is called “information intermediary”. The current trading platforms are almost all credit intermediaries. The transactions of cryptocurrency and legal tender in the platform are on the surface of free trade between individuals, but they are actually business operations under the control of the trading platform. Even if the trading platform only provides information services, whether the "chain information" provided by it should be regulated by the "Regulations" is a question that the regulatory authorities should respond to. From the perspective of jurisprudence and investor protection, the Regulations should of course include the regulation of “information under the chain” services.

The improvement of the "Regulations" also requires continuous communication with practice. In the "Regulations", as the blockchain industry is in the early stage of development, relevant application scenarios and business models are still being explored and there are many uncertain factors. The choice is to describe the scope of its application in a more general way. In the "Regulations", the type or specific content of the blockchain information service is not defined, but the expression "blockchain information service" is widely adopted. From the stage of the development of the industry and the status quo, it should be said that this provision leaves a relatively large space for subsequent development. However, in the case of a broader regulatory document, information interaction between regulators and industry units is essential. Only through the continuous exchange of information between the two can we provide a clearer red line of supervision, thus giving the blockchain information service industry the right direction.

Author: Yang Mayang

Source: Theoretical Network