China is not at home with the idea of decentralization, but then it never was. The only thing which troubles crypto analysts devising an understanding of why China is so against cryptocurrencies is the confusion that why didn’t China speak earlier when the crypto mining business was booming within the region? Why wait all those years and only issue a crackdown now? There is no logical explanation for this; maybe China had its own policies which aligned with crypto mining back in the day and now not so much. Anyway, the Central Bank of China has proposed a resolution to monitor non-fungible tokens and metaverse more closely.
The bank wants to track them with anti-money laundering tools, and in doing so, it wants to have control over every aspect of these two phenomena. The crackdown was initially limited to crypto mining and stopping foreign exchanges from entertaining the local crowd, but now it is spreading into metaverse and non-fungible tokens. The central bank of China has pointed multiple risks which are associated with non-fungible tokens and metaverse should these operate without any kind of regulation that is binding and being controlled by the state.
Major Concerns Related to Metaverse
The bank thinks that it would have catastrophic implications because then there won’t be any oversight to regulate both these aspects, and who knows what people might run into in terms of losing their privacy or, worse, their investment in such volatile industries. Another concern that the bank has with both is that this can be used as money laundering and tax evasion, which China doesn’t stand for in any shape or form.
Non-fungible tokens and metaverse-based items might propose a consistent risk when it comes to being used by the people without any regulation or a proper framework authorized by the state. In simpler words, it means that China wants to control anything and everything that is even remotely associated with decentralization or crypto market because it can’t have people having the liberty to choose their financial tools and thus leaving the fiat counterparts behind, which the country strongly regulates.