- Justin Sun says China is embracing cryptos following reports of taxation on digital asset.
- According to Sun, Chinese regulators will further regulate the industry.
- China’s tax and banking authorities still have varying opinions on crypto.
Following reports from last week that China has implemented a tax on cryptocurrency transactions, Justin Sun, crypto entrepreneur and founder of the Tron cryptocurrency, said, “This signals the country’s increasing embrace of cryptocurrencies.” According to Sun, the new tax directly hints that regulators in China view cryptos as a “legitimate form of wealth.”
Sun pointed out that the tax policy would boost the adoption of cryptocurrencies in the nation since it provides a clear regulatory framework for individuals and businesses.
Moreover, the Tron founder expects the Chinese government to regulate cryptos even further to clarify its regulatory stance for individuals and businesses in the nation. Sun also believes that the development is positive, and this move will be a blueprint for other countries to follow.
Sun’s remarks follow a story by Colin Wu published days earlier. According to the report, several “crypto whales,” “crypto miners,” and “other investors” indicated their local tax authorities were auditing them over personal income tax beginning in early 2022 and still awaiting results.
Per the report, this was due to several major domestic exchanges handing over extensive information about some of the whales’ transactions to the tax authorities. This in turn resulted in a 20% personal income tax on investment profits for individual cryptocurrency investors and several Bitcoin (BTC) miners.
The report also indicates that Chinese regulators are finally recognizing the legal status of cryptos. However, the report emphasized that tax and financial authorities continue to have differing views regarding the legality of cryptos.
Meanwhile, China has stringent restrictions on illegal financial activities using digital currencies. Its existing legal framework does not ban individuals from owning Bitcoin or other virtual currencies, which are described as “invalid civil acts,” but are not officially prohibited.