Recently, a regulatory trend worth paying close attention to has emerged. People's Bank of China Governor Pan Gongsheng mentioned at the National People's Congress that the risks in key domestic financial sectors over the past year are being resolved in an orderly manner, and the entire financial system is still operating relatively smoothly. However, there is a very important piece of information— the central bank and related departments have been maintaining a high-pressure crackdown on illegal financial activities such as illegal fundraising, virtual currency trading and speculation, and underground banks.

To be honest, this stance is very clear. Regarding virtual currency speculation, regulatory authorities have not relaxed their resolve. Pan Gongsheng explicitly stated that the next step is to continue working with industry regulators, public security, and law enforcement agencies to maintain high-pressure efforts against all kinds of illegal financial activities. This indeed increases the risks for institutions that want to operate in the gray area.

From the perspective of financial stability, the central bank is also closely monitoring the potential impacts of external shocks and is prepared to deploy macroprudential tools at any time. This means that risks related to virtual currencies, as well as financial risks from other channels, are within the scope of monitoring. If financial companies and various financial institutions are involved in illegal activities, the current regulatory environment is indeed unfriendly.

Interestingly, this also indirectly reflects the diversification of illegal financial activities in recent years— from traditional illegal fundraising to virtual currency trading and speculation, to underground banks, regulators need to take multiple measures simultaneously. If financial companies want to operate compliantly, the policy signals during this period are quite clear: stay away from any illegal financial activities and maintain the legality of your operations.

Overall, the message conveyed by this speech is that the regulatory authorities will not relax their efforts in financial risk prevention and control. Whether it’s large financial institutions or frontline financial companies, risks related to virtual currencies are now under close watch. If there are still people trying to evade regulation through virtual currency speculation, the current environment is indeed not very realistic. Frontline financial companies should also realize that compliance is the foundation for long-term survival.