The system will be adopting technologies such as artificial intelligence and machine learning. According to representatives from the AML office, virtual assets have helped in illegal transactions such as extortion, drug trafficking, gambling, and money laundering, challenged risk supervision and governance, and threaten investor rights, economic order, and financial security.
The office said banks should strengthen the monitoring and analysis of virtual asset transactions and authenticate the real names of parties involved in virtual-asset transactions. The central bank will continue to work with 60 overseas financial intelligence agencies to track virtual assets’ transactions both in domestic and foreign to support law enforcement agencies.
China has banned all cryptocurrency-related transactions, even for those made via crypto exchanges based outside of China. However, cryptocurrency transactions from mainland China still exist. Mainland crypto traders register overseas companies to circumvent policy crackdowns.
Chinese authorities remain cautious about the latest decentralisation technologies. State-owned media have continuously criticised NFT collections and warned of the risk that the metaverse could bring to the market and national security.
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