With the introduction of a fee on cryptocurrency transactions, China has "taken a significant step toward cryptocurrency regulation," Sun said. The Chinese government regards currencies as a legal form of wealth and wants to guarantee that it is properly taxed, as shown by the tax on crypto transactions.
Colin Wu, a Chinese technology journalist, reported on January 25 that Chinese tax officials had been looking into the earnings of "crypto whales" in order to tax their income. Sun was replying to Wu's claim. An unnamed whale informed Wu that "from the start of 2022, a local tax department requested an audit of its personal income tax," according to Wu. There are several individuals and a thorough list of the whales that have undergone inspection.
As it "provides a clear regulatory framework for individuals and businesses," according to Sun, this new initiative by the tax authorities should increase the adoption of cryptocurrencies in China. Sun also expressed his expectation that "the government will further regulate the crypto industry, providing further legitimacy and stability."
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