chinese

China’s Government Fuels Stablecoin Economy: Hong Kong Protesters, Singapore and Mainland Residents Flee Capital Controls

13/06/2020 by Idelto Editor

A recent study published by Amun researcher, Eliézer Ndinga, shows that USD-pegged stablecoins are being leveraged in Hong Kong as “vehicles for capital control flight.” The report shows how individuals from mainland China, Singapore, and Hong Kong are moving their capital out of control by using these dollar-pegged blockchain tokens.

Last week on June 9, 2020, it marked the one year anniversary of the Hong Kong protests that were invoked by China’s extradition law. Almost immediately after the law was introduced, Hong Kong’s citizenry took to the streets in an attempt to claim the country’s true sovereignty. For over 12-months there has been civil unrest and demonstrations in the streets.

The blockchain ecosystem that emerged in China has helped Hong Kong residents flee the grasp of China’s totalitarian controls. Not only has blockchain helped individuals from Hong Kong, but also residents in Singapore and those who live within the borders of mainland China as well.

“Although as an inherently digital, censorship-resistant, and neutral asset, Bitcoin has not been the first cryptoasset of choice to flee renminbi-denominated assets due to market volatility,” explain’s Eliézer Ndinga’s report.

“USD-pegged stablecoins have ended up being just as attractive assets for those seeking to avoid losing large portions of their wealth due to price fluctuations over the short and medium terms. As a matter of fact, QCP Capital a Singapore-based crypto-asset trading firm has witnessed Hong-Kong-based investors fleeing to Singapore and trading stablecoins, predominantly Tether, in an attempt to preserve their wealth.” Amun’s report adds:

According to QCP, 80% of capital has poured into stablecoins while the remaining 20% has gone into Bitcoin.

Eliézer Ndinga stresses that data and information about the use of stablecoins is not “publicly available as much of crypto adoption in Asia.” This is because most transactions take place “underground especially following the crackdown on crypto exchanges by the Chinese government starting in 2017.”

“For example, in Hong Kong, QCP Capital reported that investors trade Tether physically. This method is mainstream so that they are able to move money away cheaply and quickly compared to setting up an offshore account which might take almost a month due to stringent know-your-customer and anti-money laundering procedures,” Eliézer Ndinga’s research highlights. The researcher further states:

To mitigate counterparty risk, due to ongoing issues with identity fraud, QCP Capital follows KYC procedures and asks for collateral denominated in stablecoins.

The Amun report further notes that the “demonstrations are here to stay in the foreseeable future.” A study from 21shares research also indicates that citizens in Hong Kong, Singapore, China, and other Asian regions are gravitating toward the crypto economy in an exponential fashion.

“It is safe to say that stablecoins are becoming a pain-killer product for many investors in such situations,” Eliézer Ndinga’s essay concludes. “This capital outflow from renminbi-denominated assets to USD-pegged stablecoins will strengthen the US Dollar hegemony as the world’s reserve currency. Nonetheless, with interest-bearing accounts like the one launched by Blockchain.com, there could eventually be capital flowing from stablecoins to Bitcoin by Chinese institutional investors and high-net-worth individuals, especially among tech-savvy cohorts,” the researcher conceded.

What do you think about Hong Kong, Singapore, and residents from China fleeing to stablecoins? Let us know in the comments below.

The post China’s Government Fuels Stablecoin Economy: Hong Kong Protesters, Singapore and Mainland Residents Flee Capital Controls appeared first on Bitcoin News.

China’s Research Institute Updates Crypto Ranking — Review Affected by Pandemic

14/04/2020 by Idelto Editor

China’s Center for Information and Industry Development has published its latest crypto project rankings as the country continues to battle the coronavirus pandemic. A total of 37 crypto projects were evaluated and ranked overall this month as well as in three separate categories.

Also read: Bitcoin Revolution: Wanna Earn $1,000 a Day? Government Warns About This Scam

New Rankings Unveiled During Pandemic

The Center for Information and Industry Development (CCID), under China’s Ministry of Industry and Information Technology, released its latest update of crypto project rankings on Friday. Before this, the rankings were last updated in February when the same 37 projects were evaluated. In addition to the overall ranking, the center assessed the crypto projects based on three additional categories: basic technology, applicability, and creativity. The CCID updates its rankings every two months; this time around is the 17th update and the second this year.

This month, EOS remains top of the overall ranking, followed by Tron and then Ethereum. Bitcoin fell slightly from the 11th place to the 14th place while Bitcoin Cash rose from the 34th place to the 31st place.

China's Research Institute Updates Crypto Ranking Amid Coronavirus Pandemic — The CCID’s 17th crypto project rankings show EOS occupying the top spot overall, followed by Tron and Ethereum. The projects were also evaluated in three additional categories.

37 Crypto Projects Ranked in 3 Sub-Categories

The 37 projects were also evaluated in three sub-categories in the same way as previous updates. In the first sub-category, basic technology, EOS tops the list, followed by Tron and IOST. The center explained:

From February to March 2020, due to the impact of the global coronavirus pandemic, the update of selected public chain projects slowed down, and the overall index has not changed much.

For the second sub-category, applicability, Ethereum tops the ranking, followed by Tron, and Nebulas. For the last sub-category, creativity, BTC scored significantly higher than the other crypto projects, followed by EOS and Ethereum.

The rankings are compiled by the CCID (Qingdao) Blockchain Research Institute, an entity established by the CCID. The evaluation work is carried out in collaboration with several organizations, such as the CCID think tank and the China Software Evaluation Center. “The result of this assessment will allow the CCID group to provide better technical consulting services for government agencies, business enterprises, research institutes, and technology developers,” the center previously explained.

What do you think about the CCID’s crypto project rankings? Let us know in the comments section below.

The post China’s Research Institute Updates Crypto Ranking — Review Affected by Pandemic appeared first on Bitcoin News.

Bitcoin Mining Rig Manufacturer Canaan Sued – Accused of Misleading IPO Investors

07/03/2020 by Idelto Editor

Bitcoin mining rig manufacturer Canaan Inc. is being sued for allegedly breaking U.S. securities laws before its initial public offering (IPO). Phillippe Lemieux, a Canaan investor, filed a class-action lawsuit that claims the company violated the Securities Act of 1933. Lemieux believes Canaan misled investors and the Securities and Exchange Commission (SEC) in regards to the company’s financial wellbeing.

Also Read: Bitcoin Cash Community Supports Greater Privacy by Donating Over 100 BCH to Cashfusion Fundraiser

Canaan Gets Into Hot Water

In October 2018, the China-based mining rig company Canaan filed its IPO status with the SEC and the firm hoped to raise $400 million. However, Canaan only raised $90 million when it was listed on the Nasdaq Global Marketplace. In 2020 the mining giant’s IPO shares did not perform so well and the company also faced stiff competition from manufacturers like Bitmain, Microbt, and Innosilicon.

Canaan and Nasdaq listed CAN via a November 2019 JOBS Act Initial Public Offering (IPO). “CAN’s auditor, PWC Zhong Tian LLP, gives us little additional comfort because the firm was charged by the SEC in 2012 for violating U.S. securities laws,” explains a recently published Marcus Aurelius Value report.

Now, according to a lawsuit filed by Scott+Scott Attorneys, Canaan is being sued by an investor who believes Canaan misled investors prior to the IPO sale. “Scott+Scott, a national securities and consumer rights litigation firm, is notifying investors that a class action lawsuit has been filed against Canaan, Inc. (NASDAQ: CAN), and certain other defendants, related to alleged violations of the Securities Act of 1933,” explains the law firm.

Reports note that the lawsuit against Canaan was invoked by the company’s investor Phillippe Lemieux who filed the class-action lawsuit on Wednesday. The filing stems from the District of Oregon and the legal team is looking for other Canaan investors to join the case. Not only does the lawsuit touch upon the grievances with Canaan, but the filing also mentions the IPO underwriters Citigroup Global Markets, China Renaissance Securities, Galaxy Digital, Huatai Financial Holdings, and CMB International Capital. Lemieux alleges that certain information was withheld concerning Canaan’s financial health and the lawsuit filing claims just before the IPO sale “numerous” distributors were removed from the Canaan website.

Phillippe Lemieux filed the class-action lawsuit on Wednesday and alleged Canaan violated the Securities Act of 1933. The consumer rights litigation firm Scott+Scott’s filing stems from the District of Oregon and the plaintiff is demanding a trial.

A Damning Marcus Aurelius Report

One specific violation Lemieux points out is when Canaan ostensibly partnered with Hangzhou Grandshores Weicheng Technology Co., Ltd. (Grandshores) for distribution purposes. Lemieux’s Grandshores evidence claims Canaan’s statements about this distribution alliance were “materially false and/or misleading because they misrepresented and/or failed to disclose the following adverse facts.”

Canaan is considered the world’s second largest cryptocurrency mining equipment and application-specific integrated circuit (ASIC) manufacturer. The firm launched its initial public offering (IPO) with Nasdaq in Q4 2019 raising $90 million.

In addition to the Grandshores statements, Lemieux’s attorney cites a Marcus Aurelius Value research report that finds a significant amount of misleading statements. “Our research has uncovered a variety of irregularities and undisclosed dealings that lead us to believe CAN has deceived investors about its business,” the extremely critical Marcus Aurelius report discloses.

A Google Trends screenshot from the Marcus Aurelius Value report. “We were troubled to discover that just one month before CAN’s NASDAQ IPO, a tiny Hong Kong stock named Grandshores (HK 1647) announced a purported “strategic partnership” with CAN,” the Marcus Aurelius Value report notes.

The filing in the District of Oregon notes that Lemieux is demanding a trial by jury. His attorneys are hoping a trial will end up in favor of the plaintiff and the other class members and seeks to be awarded damages. The litigation firm working for Lemieux says the claim is brought to the courts within one year after the discovery of “untrue statements and/or omissions in the [IPO] that should have been made and/or corrected through the exercise of reasonable diligence.” The lawsuit against Canaan is “therefore timely,” Scott+Scott’s court filing concludes. At the time of publication, NASDAQ: CAN is only $4.26 a share and is down 11.7% today. When news.Bitcoin.com first reported on Canaan’s shares on January 10, 2020, the stock was swapping for $6.49. This means shares are down 34.36% since our report and down 52.61% since the Canaan IPO first launched at $8.99 per share.

What do you think about the Chinese mining rig manufacturer Canaan being sued by an investor who claims Canaan misled investors before the IPO? Let us know what you think about this topic in the comments section below.

Disclaimer: This article is for informational purposes only. It is not an offer or solicitation of an offer to buy or sell, or a recommendation, endorsement, or sponsorship of any products, or companies. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any ideas, software, mining rigs, mining rig manufacturers, websites, concepts, content, goods or services mentioned in this article. Price reports, market updates, and articles regarding stock prices are intended for informational purposes only and should not be considered as trading advice. Neither Bitcoin.com nor the author is responsible for any losses or gains, as the ultimate decision to conduct a trade is made by the reader. Canaan share (NASDAQ: CAN) prices referenced in this article were recorded on Friday, March 6, 2020, at 3:30 p.m. ET.

Image credits: Shutterstock, Marcus Aurelius Value, Canaan logos, Nasdaq logos, Fair Use, Wiki Commons, Canaan Class Action Suit, Business Wire, Google Trends, and Pixabay.

Did you know you can earn BTC and BCH through Bitcoin Mining? If you already own hardware, connect it to our powerful Bitcoin mining pool. If not, you can easily get started through one of our flexible Bitcoin cloud mining contracts.

The post Bitcoin Mining Rig Manufacturer Canaan Sued – Accused of Misleading IPO Investors appeared first on Bitcoin News.

China Adopts Security Standards for Blockchain Applications in the Financial Sector

25/02/2020 by Idelto Editor

Keeping the focus on blockchain development, banking authorities in China have issued a set of rules pertaining to the secure application of crypto-related technologies in the financial sphere. The new standards, the first of this kind, are to guide the work of developers and service providers operating in the industry.

Also read: China Issues Digital Currency Guide for Party Cadres

Central Bank of China Issues DLT Security Specification

The Financial Distributed Ledger Technology Security Specification (JR/T 0184—2020) comes as a result of joint efforts between major banks such as Industrial and Commercial Bank of China, Agricultural Bank of China, and Bank of China, under the guidance of the People’s Bank of China (PBOC). The main purpose of the document issued earlier in February is to standardize the deployment of blockchain technology in the financial field, Chinese crypto news outlet 8btc reported.

With the new regulation, the central bank of China puts an emphasis on improving information security of distributed ledger technology (DLT) applications. Organizations engaged in the development of blockchain systems for the financial sector as well as various service providers that are using DLT-based solutions are expected to comply with the standards in their activities.

The 35-page instruction paper demands the implementation of secure financial DLT technologies and addresses various aspects of such systems like basic hardware and software, cryptographic algorithms, consensus protocols, communication between nodes, smart contracts, operational and maintenance requirements. The document also deals with matters related to identity management, privacy protection, compliance support, and governance mechanisms.

On the central government level, China turned its attention to blockchain last year when the General Secretary of the Communist Party Xi Jinping stated that the country should step up research in the emerging field. At a politburo meeting, the Chinese president insisted on speeding up development in the sector so that the People’s Republic could gain an edge, given the importance of DLT in the new round of technological innovation and industrial transformation.

Technical Committees Introduce Government Standards in Various Sectors

In November 2019, Beijing announced the establishment of technical committees tasked to introduce standardization in various fields, from baby products and sharing economy to photovoltaic systems. The standards drafted for each sphere will be used to coordinate government objectives across the country and throughout the entire economy. Approved and published regulations will be reviewed every five years.

A working group was created for the blockchain space, too. Chinese authorities believe that as many DLT initiatives originate from the financial and banking sector, standardization will facilitate deployment of new systems in accordance with established universal security requirements. Officials also want to ensure a “healthy development” of the industry producing and implementing blockchain solutions.

Over 37,000 blockchain businesses operate in China, according to the country’s company information portal Tianyancha.com. More than a third of these entities have been registered in the past year alone. China is also a leader by number of filed blockchain-related patent applications which reached almost 13,000 in October, or over 53% of the global total, shows data compiled by the World Intellectual Property Organization.

The PBOC is also working intensively to prepare the launch of a digital version of the national fiat and test the new Digital Currency Electronic Payment (DCEP) system with the help of four state-owned commercial banks and three leading telecom operators. The digital yuan is said to be partially based on blockchain technology but as news.Bitcoin.com reported recently, the Chinese central bank has filed 84 patents relating to the digital currency.

What do you think of China’s decision to adopt security standards for blockchain applications in the financial sector? Share your thoughts in the comments section below.

Images courtesy of Shutterstock.

Do you need to track down a Bitcoin transaction? With our Bitcoin Explorer tool, you can search by transaction ID, address, or block hash to find specific details, and for a look at the broader crypto space explore our Bitcoin Charts tool.

The post China Adopts Security Standards for Blockchain Applications in the Financial Sector appeared first on Bitcoin News.

Central Bank of China Pumps 300 Billion Yuan Into Financial System, Cuts Loan Rates

18/02/2020 by Idelto Editor

The Chinese government has taken multiple steps so far to contain the economic fallout from the coronavirus epidemic, including interest rate cuts and financial injections worth billions of yuan. It did it again this week, extending the monetary easing provided by the central bank. With the budget under pressure, however, there are indications that Beijing may opt for some austerity measures later this year rather than a larger fiscal stimulus.

Also read: China Is Scrubbing Cash Notes to Stop Virus Spreading so Its Government Paper Money Won’t Kill You

PBOC Cuts Interest Rates on Loans for Lenders

The People’s Bank of China (PBOC) injected 200 billion yuan (almost $29 billion) into the country’s banking system which has been experiencing liquidity issues over the past year. On Monday, the funds were offered as one-year medium-term loans for Chinese financial institutions, according to Reuters. The central bank also cut the interest rate on the money from 3.25% to 3.15%.

Furthermore, the PBOC added another 100 billion yuan ($14 billion) through seven-day reverse repurchase agreements, Bloomberg reported. 1 trillion yuan (over $143 billion) of reverse repos were due to expire on the first day of the week but in the end the measures resulted in a net 700 billion yuan (over $100 billion) withdrawal from the markets.

This week’s interest rate reduction was largely expected by observers. A similar cut in the benchmark loan prime rate, which serves to determine the price of corporate and household loans, is likely to follow later this month. Economists surveyed by Bloomberg expect the same 10-basis point decrease of the rate on 1-year loans.

These measures come in the wake of early February’s PBOC announcement that it’s going to spend 1.2 trillion yuan (over $170 billion) to support growth in the Chinese economy hit hard by the coronavirus epidemic. The outbreak has already claimed the lives of more than 1,700 people in mainland China. The funds were dedicated to the reverse repurchase operation aiming to maintain stability in the currency market.

Experts quoted in the report have expressed similar opinions about the latest intervention. According to Zhou Guannan, an analyst at Huachuang Securities Co., the rate cut was expected and the supplied funding is relatively small. Becky Liu, head of China macro strategy at Standard Chartered Plc, thinks the PBOC does not intend to lower front-end rates any further.

Stimulus Through Fiscal Spending Only Not Feasible

Beijing has so far refrained from announcing a significant increase in its stimulus measures. Quoted by Reuters, the chief economist at Founder Securities, Yan Se, predicted that the PBOC will shift its focus from short term stabilization through large fund injections via reverse repo operations, to addressing the mid to long-term financing needs of Chinese businesses.

Additional fiscal spending and measures to encourage consumption remain on the table after China vowed to meet its 2020 targets for the economy last week, according to South China Morning Post. Local governments have been reportedly allowed to issue more debt to support growth in the short run. Corporate tax cuts should ease the burden on companies.

All this requires funding and the Chinese Minister of Finance, Liu Kun, believes efforts to reduce “unnecessary” government expenses must be made to fill in the widening budget gap. He discussed government plans in an article published recently in Qiushi, a magazine linked to the Communist Party of China. The minister pointed out that various external developments have intensified the downward pressure on the Chinese economy. At the same time, internal challenges such as the virus outbreak have created the need to increase fiscal revenue to cover the higher expenditures.

In 2019, China introduced the largest tax and fee reduction measures in its history, the government official remarked, amounting to over 2 trillion yuan, or more than 2% of GDP. These cuts will promote economic growth but also directly reduce fiscal revenue. Liu Kun also expects continuing pressure to increase spending, forcing the government to keep fiscal operations in a tight balance. “Under such circumstances, it is not feasible to implement a proactive fiscal policy solely by expanding the scale of fiscal expenditure,” the finance minister elaborated, indicating that Beijing is unlikely to commit to a large stimulus package as some investors have hoped.

What are your expectations about China’s fiscal and monetary policies in 2020? Share your thoughts in the comments section below.

Images courtesy of Shutterstock.

Do you want to dig deeper into Bitcoin? Explore past and present cryptocurrency prices through our Bitcoin Markets tool and head to our Blockchain Explorer to view specific transactions, addresses, and blocks.

The post Central Bank of China Pumps 300 Billion Yuan Into Financial System, Cuts Loan Rates appeared first on Bitcoin News.