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During the Golden Week holiday, a People’s Bank of China’s deputy governor announced that the Chinese digital currency, known as the Digital Currency Electronic Payment, has processed transactions worth 1.1 billion RMB during its trial. Meanwhile, the taxation treatment of digital assets in Hong Kong has entered into community discussion following PwC Hong Kong’s latest annual global crypto tax report. In the cryptocurrency exchange sphere, statistics from Cryptowisser indicated that 75 crypto exchanges were shut down in 2020, 10 of which were based in Hong Kong or China.
Here is everything you might have missed regarding these stories (and more) in this week’s edition of OKEx Insights’ China Market Watch.
PBoC: DCEP processed 1.1 billion RMB in pilot transactions
Fan Yifei, a deputy governor of the People’s Bank of China, stated that the DCEP has processed 1.1 billion RMB (approximately $162 million) worth of transactions under its ongoing pilot program.
According to Fan, the DCEP has been tested in various use cases under the pilot program — ranging from bill payments to government services. As of late August, there were more than 6,700 use cases for the Chinese digital currency.
Key takeaways
- Apart from use cases in various industries, the DCEP is also being used for different payment methods — such as facial recognition payments and tap-and-go transactions.
- The DCEP also expedited the development of digital wallets in China. According to Fan, more than 113,300 personal digital wallets and about 8,800 corporate digital wallets have been opened during the DCEP’s pilot program.
Hong Kong ranked sixth in PwC Crypto Tax Index
PwC Hong Kong, a major accounting firm, recently published its first annual Global Crypto Tax Report. The report unveils the Crypto Tax Index ranking and examines the latest crypto developments from tax regulators across various jurisdictions.
According to PwC Hong Kong’s report, property is the most common treatment of crypto assets by tax regulators. Liechtenstein topped the Crypto Tax Index and Hong Kong ranked sixth.
Key takeaways
- The PwC Hong Kong Crypto Tax Index ranks jurisdictions based on the comprehensiveness of their crypto tax guidance. Hong Kong has the second-highest ranking among Asian jurisdictions, after Singapore.
- According to Henri Arslanian, PwC Global Crypto’s lead, having specific crypto tax guidance is an essential building block for the continual institutionalization of the crypto ecosystem.
- While most jurisdictions provided tax guidance on the calculation of capital gains and losses for individuals and businesses, there is a lack of guidance on topics such as crypto borrowing and lending, decentralized finance, nonfungible tokens, tokenized assets and staking income.
Please visit https://www.okex.com/ for the full report.
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Hong Kong’s crypto tax ranking and DCEP’s pilot successes was originally published in OKEx Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.
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