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Li Lihui, a senior official at China's state-financed internet finance agency said that digital tokens without regulation from the government and are “stateless”, such as bitcoin, posed risks, as they can be utilized for illegal transactions and rules, are required to sustain the development of legally-recognized digital currencies.
The comment follows the announcement of BTCChina, a major Chinese bitcoin exchange, said it will shutter on September 30. It came a few hours ahead of the announcement of another platform, ViaBTC, a smaller Chinese Bitcoin exchange, that it was closing operations at the end of September.
Li of the National Internet Finance Association of China and the ex-president of Bank of China stated at a conference in Shanghai that global regulators should cooperate in managing cryptocurrencies.
The comments come as the Chinese authorities crack down on the digital currency business to stem risks as consumer flock to a highly risky, volatile and speculative market that has grown at an exponential rate this year.
Bitcoin prices stabilized on Friday, rising by 2.4 percent at $3,304 on U.S. exchange Bitstamp.
