China's Underground Crypto Scene 🇨🇳
Crypto thrives undercover in China's chill spots, bypassing the ban. Traders swap crypto over coffee and laundry breaks. Chinese investors turn to Bitcoin amid stock market troubles.
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So, despite China putting a big red stop sign on all crypto activities, folks still keep the crypto vibe alive in the most chill spots.
The Wall Street Journal spilt the beans, and you can find traders swapping crypto over coffee, snacks, or while waiting for their laundry.
To skirt the official prohibition, crypto enthusiasts are swapping wallet addresses, arranging bank transfers, or dealing in cash right under the nose of the authorities.
Social media platforms like WeChat and Telegram have turned into hotspots for these transactions, hosting dedicated groups for buyers and sellers to connect directly.
Why It's Happening
This underground trading scene is particularly vibrant in China's inland areas.
These regions are poorer, and local governments have bigger fish to fry than enforcing the central bank's crypto clampdown.
The People's Bank of China (PBOC) might have called crypto activities illegal back in 2021, but that hasn't stopped China from clocking in around $86.4 billion in over-the-counter (OTC) trading volume in 2023, Chainalysis points out.
Chinese Investors Find Solace in Bitcoin
With China's stock market on a downward spiral, local investors are eyeing Bitcoin and other cryptos as their new go-to investments.
This is happening even though China's pretty strict about not allowing crypto trading and mining.
But you know, where there's a will, there's a way.
Dodging the Ban with Creativity
Folks like Dylan Run, a finance pro from Shanghai, didn't just sit back. Seeing the economy getting shaky, he started pouring money into crypto early this year, despite the ban.
Dylan and others are using all sorts of tricks to fly under the radar, like using cards from smaller banks and keeping their transactions low-key.
Given the rough ride in China's stock and property markets, Bitcoin's looking like a shining beacon to many. Dylan's crypto stash, for instance, has ballooned by 45%.
Charlie Wong, another savvy investor, bypassed local restrictions by trading through Hong Kong's Hashkey Exchange.
"It is hard to find opportunities in traditional fields. Chinese stocks and other assets perform poorly… The economy is undergoing a crucial transition," Wong said.
Navigating the Grey Zone
Despite the official thumbs down on crypto, there's a buzzing underground market.
Platforms like OKX and Binance have found ways to keep serving Chinese clients discreetly.
And it's not just small fish in this pond; Chainalysis noticed a huge jump in China's peer-to-peer crypto trading, pushing the country way up in the global ranks.
Bitcoin as the New Gold
With traditional investments not showing much promise, Bitcoin's recent surge has only made it more appealing. It's becoming a popular alternative for those looking to park their money somewhere with growth potential.
Premier Li Qiang remains optimistic about China's economy, but the stock market crash and ongoing challenges have many looking for safer, more profitable havens like crypto.
Hong Kong Eyes Tokenisation
Hong Kong is doubling down on its commitment to become a leading crypto hub by planning to tokenise more government bonds between 2024 and 2026.
The Securities and Futures Commission (SFC) dropped this news as part of their latest strategic game plan.
After making waves last year with tokenised green bonds, Hong Kong isn't stopping there.
These green bonds were all about funding eco-friendly projects, and now, the city's looking to expand its tokenisation efforts to boost its financial scene.
Why It Matters: This move comes as Hong Kong's stock market has suffered significant losses since 2021, with a shrinking value of $6 trillion. With India's economy on the rise, Hong Kong is determined to stay competitive by leveraging web3 technology.
Tokenising Government Bonds: After making waves last year with tokenised green bonds, Hong Kong isn't stopping there. These green bonds were all about funding eco-friendly projects, and now, the city's looking to expand its tokenisation efforts to boost its financial scene.
Deepfake Scams: High-profile officials, including the Hong Kong Monetary Authority's chief, have been targeted by deepfake scams promoting fraudulent crypto investments.
China's Metaverse Initiative: China sets up a Metaverse Working Group with tech giants like Huawei and Tencent to standardise metaverse projects, signalling a regional interest in digital innovation.
Crypto in Pop Culture: "Crypto Storm," a new film in Hong Kong, explores crypto crimes, adding a cultural dimension to the ongoing conversation about cryptocurrency.
TTD Week That Was 📆
Thursday: SEC against the world🛡️
Wednesday: Down We Go. Then Up? 🦭
Tuesday: This too shall pass🤞🏿
Monday: Who's selling? 🪝
TTD Week in Funding 💰
imgnAI. $1.6 Million. Crypto-native AI image generation platform.
Sygnum. $40 Million. Crypto banking group.
Axiom. $20 million. Allows smart contracts to compute over the entire history of Ethereum trustlessly.
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The Token Dispatch is a daily newsletter that takes you on a 4-5 minute drive through the wild west of the Crypto World. Daily in your email inbox @13:00 GMT. Almost always.