As the Chinese government released plans to tax cryptocurrency, concerns have been raised about customer privacy and the role that exchanges may have in providing customer information. However, Huobi Global consultant Justin Sun has said that Fire will not provide customer information to law enforcement agencies unless it follows international judicial assistance procedures.
China Cryptocurrency Tax – Sun Yuchen Reacts: HuobiGlobal Won’t Share Data
Cryptocurrencies are becoming increasingly mainstream in 2021, with countries such as China gradually making a comeback and embracing the asset class. The country’s recent decision to levy a tax on crypto transactions has been seen a positive move towards the industry’s widespread adoption. Justin Sun, the founder of cryptocurrency giant TRON, thinks that this could be a role model for other countries.
However, due to crypto’s illegal nature, it is difficult to have a clear legal definition for cryptocurrency users and transactions. As a result, the taxation of cryptocurrencies is blurred and the Chinese government has yet to make a definitive decision on it. Therefore, the news that Fire could provide customer information to the Chinese tax authority caused panic among customers and users. In response, Sun took to twitter to stress that HuobiGlobal will remain based in Seychelles and carry out its operations in the Caribbean.
Not surprisingly, enforcement of the ban on crypto trading has been largely ineffective, as evidenced by Chainalysis’ Global Crypto Adoption Index which showed that China jumped up to 10th place in the list with widespread use of centralized services. To ensure best outcomes and to make sure that its citizens’ privacy is protected, the government is working on advancing its taxation policies, property declaration and registration mechanisms, as well as real-name registration and dynamic tracking of users holding a large number of virtual currency.
It appears that neighbouring countries Hong Kong and Singapore have been taking a much more progressive stance on crypto regulations. In a bid to maintain its status as a financial centre, the Hong Kong authorities have welcomed crypto firms and recently launched a consultation on new requirements for digital asset trading platforms. Singapore, on the other hand, is set to become have stricter regulationsfor existing market players, following the bankruptcy of several firms in the city-state.
On top of that, the East Asian region has seen a host of exciting developments in the last few weeks including the launch of NBA China’s Non-Fungible Tokens, Tencent Cloud’s collaborations with firms who want to support the Web3 ecosystem, and the launch of MOBA blockchain game SuperpowerSquad.
The crypto industry in East Asia is growing exponentially. Despite extensive bans and regulatory concerns, the East Asian markets continues to be a hotspot for investors. Amid all of this, it remains to be seen how the Chinese government will keep up with the ever-evolving cryptocurrency environment and protect its citizens’ assets and privacy.