A senior executive at China's internet finance association has urged Chinese regulators to create a framework of regulations to support the development of digital currencies amid a fierce crackdown on trading on virtual tender such as bitcoin.

Li Lihui, a senior official at the National Internet Finance Association of China and a former president of the Bank of China, said at an event on Friday in Shanghai that global regulators should work together on digital currencies.

Chinese regulators are cracking down on the cryptocurrency sector, in a bid to stamp out potential financial risks as consumers pile into a highly risky and speculative market that has seen unprecedented growth this year.

Major Chinese bitcoin exchange BTCChina said on Thursday it would stop all trading from Sept. 30, setting off a slide in the value of the cryptocurrency that left it over 30 percent away from the record highs it hit earlier in the month.