The People’s Bank of China is after the metaverse and NFTs and wants to follow them using anti-money laundering technologies.
According to a recent statement by a People’s Bank of China (PBoC) officer, China’s crypto crackdown is now extending to the metaverse and nonfungible tokens (NFT).
Gou Wenjun, director of the PBoC‘s Anti-Money Laundering (AML) section, spoke at a national financial security summit about the dangers of leaving emerging developments in the crypto environment, such as NFTs and the metaverse, uncontrolled. While people may utilize digital assets for privacy and wealth appreciation, he claims they are equally vulnerable to being exploited for illegal objectives such as money laundering and tax avoidance.
The AML chief said that the separated nature of crypto, NFTs, and metaverse-based things from the actual world can be exploited as a money-laundering tool due to the fast-paced innovation of the crypto industry, which necessitates higher risk monitoring and governance standards.
Gou proposed that “clarify the division of supervisory responsibilities, improve the transparency of virtual assets, and explore the use of supervisory sandboxes to study and judge the essence and nature of virtual assets,” suggesting an objective look at the evolution of virtual assets and the development of underlying technologies.
The second phase, according to Gou, is for China to improve its surveillance and analysis of digital asset transactions. He suggested that banks and payment systems that provide fiat-to-crypto gateways should use actual identities to authenticate senders and recipients while also boosting the capacity to recognize questionable transactions.
The PBoC official recommended that new technologies be better applied and that a digital asset transaction traceability and scene tracking system be established. To designate accounts that trade with probed addresses, such a system would use artificial intelligence, machine learning, and other technologies.
Finally, Gou is willing to work with financial intelligence agencies throughout the world to build an international alliance to combat crypto-related crimes. “The Anti-Money Laundering Center will continue to deepen information sharing and co-investigation cooperation with 60 overseas financial intelligence agencies,” he added.
