But what would happen if Tencent went bankrupt? That would be a terrible day for netizens, said Liang Chunxiao, chief analyst at Chinalabs, a Chinese information technology counselling firm.

The PBOC's biggest concern about virtual money should be how to insure the solvency of the organizations that issue it, he said.

"If Tencent one day went bankrupt, the Q coin would completely lose its value," said the analyst.

He added that althoug bankruptcy was unlikely, there was still a risk of its happening in the future.

One possible action the PBOC could consider taking would be to ask outfits that circulate virtual money to set up a reserve account at a designated bank to guarantee their solvency on behalf of the public, he said.

Earlier this year, Alibaba set up such a system with the Industrial and Commercial Bank of China (ICBC) to cover its online payment platform, Alipay. The ICBC has been releasing monthly reports on Alipay's solvency since last May.

"The co-operation between Alipay and ICBC has helped Alipay win the trust of its customers," said Liang. "I think organizations that circulate virtual money would be pleased to set up similar systems."

Liang said the PBOC's Administrative Measures on Payment and Settlement Organizations, which are meant to regulate online payment companies in China would serve as a template for regulating virtual money. The measures are expected to be issued as early as this month.

"Under these measures, all online payment companies in China have to get a license from the PBOC in order to continue their business," he said. "I think the regulation on virtual money will follow a similar pattern."

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