Financial Illiteracy Guides China’s Caution on Digital Assets, Professor Says

(Munich, Germany) — China has taken a prudent approach to digital assets regulation due to the limited financial literacy among its population and significant risks these complex products could introduce to the market, Tsinghua University finance professor Zhang Xiaoyan told an audience at a conference in Munich Saturday.

China’s regulators are cautious about digital assets because they are worried that retail investors will take on excessive leverage and risk once they gain access to the novel products, said Zhang during a panel co-curated by Caixin and the Digital-Life-Design (DLD) conference.