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Chinese traders bypass government control on crypto trading – OTC, P2P trades

China’s Communist Party government has tightened its control of crypto trading.

Bloomberg with a piece on the greater use of over-the-counter platforms and peer-to-peer networks since domestic exchanges were banned in 2017

  • OTC platforms operated by firms including Huobi and OKEx are used to arrange trades
  • separate payments platform are used to send yuan to the seller
  • digital coins usually held in escrow by the OTC platform until the yuan payment clears, are then transferred to the buyer

Says Bloomberg:

  • Chinese regulators often have no way to connect one step of the transaction to the other.
BTC update:
China's Communist Party government has tightened its control of crypto trading.

Chinese think-tank says while US tariffs on China are likely to remain in place a middle ground might be found

Reuters with a curious piece from ‘think tank’  China Finance 40 forum (CF40)

  • Biden administration unlikely to remove tariffs on Chinese goods in the short term
  • says the US may look to reduce the tariff burden through tariff exclusions, which would avoid resistance in congress and ease political pressure
Tariffs are not the only issue though says the Tank:
  • “During the Biden administration, technological competition and confrontation between China and the United States in cyberspace will intensify, and the possibility of parallel systems will increase”
Reuters link for a little more if you are interested.
Reuters with a curious piece from 'think tank'  China Finance 40 forum (CF40) 

Weekend – China regulator says will further crackdown on market manipulation

China will continue to further tighten supervision on violations in the country’s capital market, including fraudulent issuances, financial fraud, and market manipulation.

Comments from Li Chao, vice chairman of the China Securities Regulatory Commission, reported in the state media People’s Daily. Adds:
  • commission will quicken improvement of securities and law-enforcement systems
  • in conjunction with other regulators, parties
  •  and mechanisms, together with other relevant parties, Li said.
Chinese authorities last week accelerated efforts to dampen high and rising commodity prices, taking action in futures markets to discourage further speculative activity.

Yuan comments from an ex-PBOC official – Rapid appreciation is not sustainable, Bank will act

Said the rapid rise of the RMB against the US dollar may have overshot, signalling excess short-term speculation.

Speaking with Xinhua (info via Reuters)
Comments are from Sheng Songcheng, former director of the surveys and statistics department at the PBOC. Bolding is mine:
  • We will prevent short-term money flooding from pushing up the yuan and diminishing the competitiveness of export firms”
  • “The appreciation of the yuan will squeeze margins at export firms, in particular the medium- and small-sized ones”
  • Sheng also said rapid rise in the rate will distract firms from their main business as they turn to speculative activities!
Sheng’s warnings come with the background:
  • On Friday the PBOC set the reference rate (midpoint) for onshore yuan at its strongest (for the yuan) since May of 2018
  • larger state-owned banks were reported as selling yuan against the USD last week, which would have the impact of slowing the yuan’s rise
Separately over the weekend, the PBOC-sponsored Financial News outlet warned on factors that could lead to a fall of the yuan against the USD, including:
  • policy changes by the Fed
  • strong revival of the US economy
  • control of the COVID-19 pandemic
  • a bursting of U. asset bubbles
Said the rapid rise of the RMB against the US dollar may have overshot, signalling excess short-term speculation.