China, previously hostile to cryptocurrencies, may soon embrace them, according to Justin Sun, the founder of Tron. He believes that the introduction of a tax on transactions is a sign of the government’s recognition of cryptocurrencies as a legitimate form of wealth and a step towards regulating the industry.

Sun expects that the tax policy will encourage adoption in China and provide a clear regulatory framework.

He also theorizes that the tax could have positive effects on the global market and set a precedent for other countries to follow.

However, not everyone agrees with Sun, as some believe that the complexity of the situation with different views from tax and financial authorities may not mean a complete policy reversal.

Despite the differing opinions, some local tax authorities in China have started imposing a 20% personal income tax on investment profits and Bitcoin mining.