Add STASIS CEO Gregory Klumov to the list of cryptocurrency figures who believe China’s recent decision to ban digital assets will not stop the market from growing. A sister company of EXANTE, STASIS is a stablecoin and tokenization platform based in Malta.
In late September the People’s Bank of China announced virtual currency business activities were illegal, adding they seriously endanger the safety of people’s assets. This is occurring in spite of the government being well down the road in developing its own digital currency. They have even started testing drops in wallets in some regions. Watchers have long predicted China was trying to be a national leader in developing a CBDC
Klumov described the decision as a “harsh” one but said he does not believe the markets will be affected in the long run. Short-term, it has caused some movement as additional pressure on the market was exerted by the tightening of requirements for its participants by the Chinese regulator. Those exchanges with Chinese roots announced the termination of the registration of customers from China.
“This triggered a sharp drop in tokens from Chinese exchanges such as Huobi and OKEx, as well as a sell-off on a wide range of digital assets, including blue chips such as Bitcoin and Ethereum,” Klumov observed.
There will be no effect longer term because the cryptocurrency sector has evolved too far and is becoming enmeshed in existing global systems.
“China’s harsh position in the long term does not affect the cryptocurrency markets,” Klumov said. “Digital assets will continue to integrate into the financial system, and also become an increasingly popular sector for the allocation of assets among large investors and institutions – but outside the Middle Kingdom.”
The Chinese move has produced added benefits to some industry players, Klumov explained.
“In this regard, there is a persistent and persistent interest in third-generation networks that do not have a Chinese footprint, such as Avalanche or Cosmos,” he added.