Virtual money to be cracked down if used to launder money
China’s central bank suggests cracking down on a popular virtual currency, dubbed Q-coin, if it could be used for money laundering or harbor other risks.
The currency is widely used on the Internet. It is issued by a leading Internet community operator, Tencent, for the users of an on-line chat room QQ, which had 220 million users by March 2006. It is possible to buy this currency with bank cards, telephone cards or QQ cards at an official price of USD 00.125.
Initially, the currency was to be used to buy on-line services provided by Tencent, including electronic cartoon portraits, greeting cards, chips in on-line QQ games and anti-virus software. However, Q-coins began being used by many people when trading among themselves and buying services provided by other websites.
According to some experts, conversion between the Q-coin and the yuan, if unchecked, could involve dire economic consequences. Therefore, Li Chao, spokesman of the People’s Bank of China (PBOC) says that the central bank has begun to investigate the issue, and that it will crack down on virtual money if it is used for money laundering.