
Cryptography law approved in the 13th Chinese National People’s Congress
- Cryptography law will be effective in China by January 1st, 2019.
- Trading cryptocurrencies within China is still blocked.
- The law will focus on resolving the regulatory and legal challenges revolving commercial cryptography.
- Further research invited to advance cryptography technologies and develop standardized regulations.
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The President of China, Mr. Xi Jinping, had given a statement on Friday, October 25th, 2019, that it is time for China to adopt the blockchain technology and seize the opportunities while it still can in order to prevent the country from being left behind in this league. Following the announcement, China’s 13th National People’s Congress has declared on Saturday, October 26th, 2019, that the cryptography law that was previously presented for consideration has been passed. The Chinese media has reported that by January 1st, 2020, the law will officially be effective.
Trading Cryptocurrencies Is Still Banned In China
Copy link to sectionIt has further been emphasized that the passage of the law doesn’t validate trading cryptocurrencies within the premises of China. While trading is still blocked with authorities expecting to digitalize the national currency in the future, the law has accepted cryptography in general, as a fundamental component of blockchain technology at large, in order to compete well in this space.
In the latest draft of the proposal, it was extensively accentuated that the law can be expected to contribute to resolving the legal and regulatory challenges that are currently prevailing in commercial cryptography. Finding a way around such challenges, the draft stated, is integral for the optimum development of China’s economy.
The proposal has clearly identified that the current system for regulations is not sufficient for the rapidly evolving crypto industry. In the best interest of the nation, therefore, detailed regulations and guidelines will require to be set in place to evaluate the applications of commercial cryptography in various fields across the country.
Officials from the Chinese National Congress were reported stating that implementation of the law is likely to be two-fold. On one hand, it will encourage the development of a standardized regulatory system that is applicable to all industries and markets, while on the other hand, it will aim at enhancing the research to further advance the commercial cryptography technologies.
Complications In The Cryptography Law
Copy link to sectionThe initial proposal for the cryptography law was revealed by the Congress back in July of 2019 when the public was also invited to make comments. The proposal has also been reported to have certain complications regarding the need for the businesses to formally verify their use of commercial cryptography with the concerned authorities as well as the compatibility of the industry-specific standards with other relevant systems that are in place internationally.
The Standing Committee of China has further added that educational efforts will also be upscaled on a national level. Public exhibitions aimed at promoting cryptography among the businesses, government officials, and societies can be expected in the time to come.
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