Dow Jones Winning: Why China’s Stock Market Surging For First Time in 3 Months is Crucial

For the first time in 3 months, the Chinese stock market has recorded a 3 percent increase triggered by the optimistic prospect of a comprehensive trade deal. The Dow Jones is nearing the 26,000 point mark after initiating a strong rally in the past two weeks.

The solid movement of the CSI 300 Index, which replicates the performance of top 300 stocks in the Shanghai and Shenzhen stock exchanges, has shown that investors in Asia highly anticipate the trade talks with the U.S. to see significant progress in the weeks to come.

The CSI 300 Index made robust gains in anticipation of satisfactory trade talks between the US and China. | Source: TradingView

The Dow Jones recorded a 1.3 percent rise on February 17 and is en route to breaking out of the 26,000 point level for the first time since November.

Dow Jones Rally Expected, Analysts Say Trade Deal Fears are Exaggerated

With jobs growth and household balance sheets at record highs, the U.S. is arguably in a better position than China in any given time frame.

The growing number of defaults in China has placed more pressure on the domestic market and the authorities to achieve a deal with the U.S.

A full-scale trade agreement is crucial for both countries in the short-term as it would alleviate significant pressure from the Chinese economy and strengthen the rally of the Dow Jones and the U.S. stock market in general.

The stock market of China and the rest of Asia are recovering in a period during which the outcome of the trade deals remains uncertain.

The Trump administration has publicly expressed its intent to consider a 60-day extension on the March 1 deadline, a move that could destabilize major markets.

However, the Chinese market has rebounded strongly in the last 24 hours, demonstrating the growing confidence of investors in the prospect of the ongoing trade talks.

Baird vice chairman for equities Patric Spencer said that the fear around the result of the trade talks has been overblown. With the newly adopted patient approach by the Federal Reserve, the executive stated that the market is in a decent place to maintain its momentum.

“The market has been worried about the China tariffs but Trump wants a deal and a lot of the fears are generally overblown. The more patient terminology from the Fed has been fairly accommodative for markets so far.”

Recently, as Admisi strategist Marc Ostwald said, investors have begun to focus on the positives over potentially negative factors that could lead the stock market to the downside.

Similarly, Direxion Investments managing director Paul Brigandi said last week that investors in the U.S. market have been trading based on momentum and the strong performance of the Dow Jones.

The Dow Jones Industrial Index has also seen momentum stick since the turn of the year. | Chart via TradingView

As such, if the trade talks with China continue to show progress in certain areas, the near-term rally of the Dow Jones and the rest of the U.S. market could be sustained.

“Momentum is a key component right now. A lot of people are jumping in to get on board,” he said.

Some Difficulties in the Trade Talks

The stalemate in the trade discussions with China seems to derive from the requests of the U.S. on fundamental changes to the structure of the Chinese economy.

The U.S. government has reportedly asked Chinese negotiators implement significant changes in the country’s industrial policies.

Despite the speed bump in the U.S.-China trade talks, the optimism stems from the intent of both countries to move forward with the discussions without imposing additional tariffs or restoring previous tariffs.

Most of the positive movements in the stock market of the U.S. and China are fueled by the certainty of investors that while the trade deal could be pushed beyond the original deadline, the two countries are not in a rush to impose higher tariffs in the short-term.


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Author: Joseph Young 
Image Credit: Source: AP Photo/Richard Drew)

Why China’s Economic Slowdown Could Trigger a Full-Blown Global Recession

By CCN.com: According to new figures from the International Monetary Fund (IMF), the European Central Bank (ECB), and the Chinese government, Europe and China are continuing to struggle following a poor year of growth in 2018.

ECB President Mario Draghi said on January 24 that downside economic risks could pose a threat on the economy of the euro-zone, citing geopolitical uncertainties, the U.S.-China trade war, and the volatility in the global financial market as major contributing factors.

China and Europe Slowdown May Lead to a Global Recession

Earlier this month, a market strategist Russel Napier wrote in a column that the demise of the euro could trigger the collapse of the global monetary system, resulting in a full-blown global recession.

Napier said:

“The key consequence of this collapse will be the destruction of the euro. The expected success of the far-right and far-left in the European parliamentary election in May this year augurs the beginning of the end for the currency union. Both extremes share a commitment to the return of sovereignty to their parliaments that is incompatible with a single currency.”

In an official speech, ECB President Mario Draghi acknowledged the decline in the momentum of the euro and the euro-zone economy on Thursday, stating that the central bank will have to establish new inflation and economic forecasts by the end of the first quarter of 2019.

Draghi emphasized that a wide range of instruments such as bonds, interest rates, and long-term loans could be utilized to stimulate the euro-zone economy. But, analysts remain unconvinced whether it would be sufficient to lead to the euro-zone to a full recovery by the year’s end.

An economics commentator Greg Ip noted that based on the numbers released by the IMF, which suggest that the global economy is set to expand by 3.5 percent in 2019, a global recession will not occur in the short-term.

However, Ip explained that the series of revisions made by the IMF in its forecasts and projections present an issue for central banks across the world and depending on the strategies employed by major regions like the euro-zone and China, the global economy may face long-lasting turbulence throughout the years to come.

“This latest disappointment isn’t the story; the real story is the serial disappointments that have dogged this expansion from the start. The IMF keeps projecting a return to the 4%-plus growth that prevailed in the 2000s, and keeps having to revise it down,” Ip wrote.

The slow down in the growth rate of the European economy coincides with the newly released report from the Chinese government that the economy of China grew by a mere 6.6 percent in 2018, recording the slowest pace in over two decades.

U.S. Economic Growth is on the Decline as Well

Several reports in the past week have claimed that the struggle of the euro-zone and China may affect the economy of the U.S. in the short-term.

Already, as disclosed by the Conference Board economic research director Ataman Ozyildirim, U.S. economic growth is projected to slow down by the end of the year, having recorded a slight drop in the last quarter of 2018.

Since late December, major stock market indexes including Dow Jones, S&P 500, SSE Composite, and Nikkei 225 have performed relatively well, but analysts believe that the global economy remains vulnerable to a potential downturn and trend reversal.


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Author: Joseph Young 
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Falling GDP, China’s Weakening Economy Drops Crude Oil Price By 2%

China’s weakening economy is driving fears of a global slowdown and now impacting oil markets. The price of crude oil fell 2.1% today.

New Data Shows a Cooling Chinese Economy

The latest data on Chinese imports and exports, below expectations, dropped the Dow Jones 230 points in premarkets today. The Dow Jones recovered but failed to turn green, ending the trading session down 0.36%.

Imports to China fell 7.6% year on year, while exports fell 4.4%.

According to recent reports, sources are warning that China is planning to lower its growth forecast to 6%. And, Moody’s has also found that “producers price inflation” has lowered over six consecutive months, a further sign of reduced demand in China.

Brent Crude Oil Price Drops 2%

The international benchmark for oil price, Brent crude, fell $1.48, or 2.5%, a barrel ending the trading session at 1.92% down at $59.27 a barrel.

Norbert Ruecker, head of macro and commodity research at Julius Baer said of China’s impact:

“Both imports and exports disappointed expectations and are set to revive fears about a global growth slowdown.”

Stephen Innes of Oanda echoed the sentiment saying:

“Oil prices are getting weighted down by the prospects of weaker economic growth in China.”

Despite hope last week of positive trade resolutions between the US and China, Innes added:

“This data drives home just how negative of an impact trade war is having on the Chinese and perhaps global economy.”

The import figures do not specifically point to a slowdown in China’s demand for oil, yet. Reuters calculations put China’s imports of crude oil up 30% in December 2018 compared to the previous year.

Oil futures also fell, the NYMEX-traded West Texas Intermediate (WTI) dropped 0.9% to $51.12 per barrel.

OPEC Cuts May Hold Back a Greater Impact on Oil Prices

The Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC countries including Russia agreed to cut oil output by 1.2 million barrels per day beginning this January. The move is designed to prevent market oversupply and boost oil price. This could be balancing today’s impact on crude price from China and slowdown fears.

Saudi Arabia’s Energy Minister Khalid al-Falih said today:

“The global economy is strong enough, I’m not too concerned. If a slowdown happens, it will be mild, shallow and short.”

Al-Falih is confident in the current performance of the oil market and does not believe OPEC should reconvene early to address the issue.

Analysts are predicting oil prices, per Brent Crude, to reach the mid-$60s and WTI to reach $55. This may depend on China’s economic performance later this year and the final outcome of US-China trade talks.

Krishna Memani, chief investment officer at OppenheimerFunds, said today he does not expect a US recession for at least five years. Memani believes a positive resolution between the US and China will happen as both countries have too much to lose, leaving the markets “home free.”


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Author: P.H. Madore
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Dow Opens to Minor Monday Gains as US-China Trade Talks Ramp up

The Dow Jones Industrial Average opened to minor gains on Monday morning as the US stock market continued to wait to see whether renewed negotiations between the world’s two largest economies would bring an end to the US-China trade war.

Dow, S&P 500 Teeter as World’s Largest Economies Meet for Trade Talks

As of 9:32 am ET, the Dow had gained 38.27 points or 0.16 percent , while the S&P 500 added 0.08 percent to its impressive Friday run. The Nasdaq, which had been the worst performer in pre-market trading, fought its way back into the green for a 0.27 percent gain.

Dow (blue), S&P 500 (red), and Nasdaq (orange) futures mostly traded sideways ahead of Monday’s opening bell.

Those muted movements marked a severe departure from Friday’s close when all three indices punctuated the week with massive rallies. The Dow rose 746.94 points or 3.29 percent to close at 23,433.16, and the S&P 500 closed at 2,531.94 for a daily gain of 3.43 percent. The Nasdaq managed to surge even further, gaining 4.26 percent ahead of the closing bell.

In what has quickly become the “new reality” for investors, the stock market has been intensely volatile in recent weeks. Now, though, it appears that the Dow and other major indices are waiting for more details on renewed US-China trade talks to determine whether it will build on Friday’s recovery or slip back into the red.

Will US-China Trade Talks Reach a Resolution?

On Monday, Deputy US Trade Representative Jeffrey Gerrish led a delegation to China for two days of trade negotiations. The first day of talks brought an unexpected visit from Chinese Vice Premier Liu He, the country’s top economic policymaker and the direct head of the trade discussions.

The standoff between the two countries has begun to make itself known in the markets, with tech bellwether Apple forced to slash revenue guidance due to poor fundamentals in China, the first major indication that US companies stand to take severe losses if the “tariff truce” expires on March 1 without a new trade agreement.

Some analysts have speculated that a weak stock market could force US President Donald Trump’s hand, but US Trade Representative Robert Lighthizer has reportedly been adamant that he wants to prevent Trump from cutting a deal that includes “empty promises” from the Chinese.

Consequently, it seems like traders are holding their fingers off the trigger until more details from the trade talks emerge. Liu’s appearance at the talks is likely a positive sign, though it’s still not clear from reports how great a role he played in Monday’s discussions.

Top Movers

Toymaker Mattel (MAT) extended its Friday rally, rising 4.9 percent to headline the S&P 500. Micron Technology (MU) and Dollar Tree (DLTR) led the Nasdaq, with the former rising on analyst predictions that MU shares have “bottomed out” and the latter popping in response to reports that activist investment firm Starboard Value wants to shake things up at the discount retailer.

PG&E Corp (PCG) was far and away the worst performer in either the Dow, S&P 500, or Nasdaq following the opening bell, with shares plunging 22 percent on reports that the California utility company faces a minimum of $30 billion in liability for fires in 2017 and 2018, including the Camp Fire — believed to be the deadliest wildfire in California’s history.

Government Shutdown: Week 3 with No End in Sight

The partial shutdown of the US federal government has now entered its third week.

On the domestic front, the markets could soon begin to see the impact of the partial government shutdown, which has now entered its third week with no end in sight.

The Democratic-led House of Representatives and the Trump Administration continue to spar over funding for the president’s proposed border wall, with neither side caving to pressure to strike a deal to fund the nine federal departments that ran out of money on Dec. 22. An estimated 800,000 federal employees have been placed on unpaid furlough or forced to work without pay, leading to mass callouts in the Transportation Security Administration (TSA) and other high-visibility departments.

As of Monday morning, the 16-day shutdown is tied for the third-longest in US history, and the number of federal employees refusing to show up to work will only increase as people grow tired of working without pay or seek temporary employment to help cover their monthly expenses.

US Taxpayers Get Cold Shoulder from IRS amid Shutdown

A prolonged shutdown would have a much wider impact moving into tax season, as the Internal Revenue Service (IRS) is one of the agencies currently operating at limited capacity. While US taxpayers must still submit their annual tax returns and estimated quarterly tax payments, the IRS said that it may delay refund processing if filing season opens with the shutdown still in force.

More than just a frustration for US residents, delayed refund processing could deprive the economy of a regular source of consumer spending since many taxpayers use their annual refund checks to fund or place down payments on vehicles and other large purchases.

Price Charts from TradingView.


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Author: Josiah Wilmoth
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Signs That China Is Bullish On Cryptocurrency Future

Over the last two or three years, China’s relationship with blockchain technology and cryptocurrencies can be easily regarded as a love-hate one.

However, as of late, there have been numerous reports hinting at the incredible attention the Chinese government towards cryptocurrencies. In fact, there have been numerous reports of a cryptocurrency launched by the Chinese communist government.

Considering China’s economic power, its international prowess, and its immense population, there’s no wonder that such a cryptocurrency could very well surpass Ethereum and even Bitcoin in popularity.

Before we dive deeper into the subject and analyze all the signs that China is bullish on cryptocurrencies, we will discuss China’s past events related to crypto, to the country’s current stance regarding cryptocurrencies and blockchain, as well as previous developments regarding legislative decisions.

Past Legislative Decisions Regarding Cryptos

If you’ve been passionate about crypto for the last two years, you probably remember that one of China’s most controversial legislative decisions regarding cryptocurrencies was to ban ICOs and any activity if any entity is raising virtual currencies.

The Chinese government declared then that the selling and distribution of tokens is an illegal fundraising method and, hence, a form of financial fraud punishable by law. Things didn’t stop here, as the Chinese government also blocked all websites related to crypto trading and ICOs, including foreign platforms. Still, regulatory bodies have been more favorable.

Following these decisions, advertisements for cryptos were also removed from the mainstream media. Back in April 2018, China put a halt to hosted blockchain events as well. So, considering all these aggressive and extreme decisions that display a rather bad stance on blockchain technology and cryptocurrency, it’s surprising that China is, in fact, bullish on blockchain and cryptocurrency developments.

China’s Current Stance On Cryptocurrencies

According to People’s Bank of China (PBOC), cryptocurrency investments (at least uncontrolled ones) can harm the Chinese economy and potentially pose a risk for the Yuan.

In short, the government has made its stance on crypto very clear: it doesn’t want them, and will not tolerate them, especially if they are external and not entirely controlled by the ruling power of China.

Be that as it may, the PBOC also released various statements saying that the research and development of cryptocurrency and blockchain technology is a top priority for China. This means that China’s central bank acknowledges the fact that crypto will replace paper money inevitably and this requires some research in order to take the best possible decision.

Interestingly enough, it is said that the Chinese government has invested and backed up various local crypto projects, such as Xiong’An Global Blockchain Innovation Fund, which supports many blockchain startups. According to several sources, the government offered at least $3 billion to fund emerging blockchain projects.

President Xi Jinping has also made a public televised appearance and called blockchain a “breakthrough” technology.

Why China Might Need Its Own Cryptocurrency

Despite all the bans and the controversial attitude towards blockchains, the national cryptocurrency started to circulate in two Chinese cities (Shenzhen and Guiyang). The national cryptocurrency in China is far from being a secret, as Zhang Yifeng, the chief of science and technology at the Banknote Blockchain Technology Institute admitted on numerous occasions that China is working on it.

The PBOC needs a digital coin in order to bring all cryptocurrencies back under the state control. It’s worth noting that, before the ban, China actually had one of the largest trading volumes of all countries. Not only that, but China also has a big number of crypto enthusiasts and crypto miners, not to mention crypto mining farms.

Ether and Bitcoin (as well as other cryptos) are still used in China to conduct illegal transactions and money laundering operations. The Chinese government wants to introduce its own cryptocurrency to solve these problems and also to make miners switch to mining a government-backed cryptocurrency. With these moves, the Chinese government hopes to reinstate control over all financial operations within the country.

There’s still not much information whether the coin will be ChinaCoin or CryptoYuan, but one thing is for sure: China will join the ranks of Russia and Venezuela who both have the same types of financial aspirations.

One interesting point of view is related to what effect will this cryptocurrency have on the crypto market once it hits mainstream adoption in China. There are those who are afraid that this Chinese cryptocurrency will actually crash the Bitcoin, Ripple, and Ethereum-powered market.

Conclusion

Considering everything that’s been said, it’s safe to say that China is not truly bearish or bullish on cryptocurrencies. The government does indeed accept the inevitability of crypto dominance over other traditional payment systems, but it still wants to retain full control over all transactions within the country.

In fact, China is very bullish on blockchain development and the government seems to have a long-term plan that started with the banning of cryptocurrencies last year. China’s authority finance institutions have announced that cryptocurrency and blockchain development will be a top priority for 2018 and, so far, everything acted out accordingly.

Many crypto experts agree that China will either “break” the crypto market or lead the charge towards a new bull market. It’s important not to forget that China’s influence on the international cryptocurrency market is immense.


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Author: UseTheBitcoin
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China’s Ban May Have Failed as Study Shows There’s Now 7.5 Million Chinese Cryptonians

China’s central bank boasted earlier this year that their probably illegitimate ban of crypto exchanges was very successful, but a new study is showing that the user numbers of cryptonians is growing according to local media.

“The statistical results of Aurora Big Data show that the industry penetration rate of virtual currency applications has entered a rising channel since last November, and the growth rate of industry penetration has slowed down significantly since June this year.

As of September, the number of industry users of virtual currency applications reached 7.51 million, an increase of 230.84% ​​over the same period last year,” they say according to a rough translation.

Crypto users in China spike to 7.5 million, December 2018.

It appears PBOC’s diktat was initially successful as user numbers fell between September and December 2017 even as the west and much of the world was gripped by what the media described as crypto mania.

Since December last year, however, there has been steady growth with crypto user numbers tripling as estimated by the downloads of crypto related apps.

They say mobile light wallet imToken, as well as Huobi Pro and OKEx crypto exchange apps, are the most popular crypto applications in the country followed by crypto media apps.

As this is looking at app downloads, the estimates do have to be taken with skepticism, but generally it appears cryptos are seeing a rebound in China. Interestingly they say:

“The user-level distribution results updated to September show that 12.7% of virtual currency application users are distributed in first-tier cities, and the proportion of users in new first- and second-tier cities is 19.8% and 19.5%, respectively.

Third-tier cities accounted for 20.7% of virtual currency applications, and 27.3% of users were distributed in cities with four lines and below.”

At face value that seems to suggest that China’s poor are more interested in crypto, but it might also be that China’s poor are more numerous.

About 52%, however, are in first and second tier city, with China dominating google searches for ethereum in particular – which google’s search trends estimate will rise to 50 out of 100 – and for Solidity especially.

A number of highly public events occurred in China this year that may have brought considerable attention to eth as some used its blockchain to bypass the strict censorship implemented by the Chinese Communist Party.

That may have brought attention to the relatively new world computer which hasn’t seen a China fever, unlike bitcoin or unlike in South Korea.

How are these 7.5 million Chinese people using crypto, however, considering it has effectively been banned as far as conveniently buying and selling it?

That we do not know, but electricity is very cheap there so they might be mining it. That may have created fairly widespread availability of peer to peer trading, but we suspect it is probably more of a work around of sorts.

China can ban its own banks from dealing with crypto, but obviously not foreign banks. An easy way to get around the ban, therefore, would be to transfer outside of the country up to circa $50,000 due to capital controls, so buying or even selling crypto on foreign exchanges.

We’ve long speculated that much of the volume in South Korea is actually Chinese because South Korea’s astonishing rise coincided with China’s fall where this space is concerned.

On the other hand, South Korean exchanges have been forced to take protectionist measures of allowing only South Korean nationals to sign up on their exchanges. That would invalidate our theory, unless one assumes that finding a South Korean proxy would be somewhat easy.

Meaning China has effectively shot itself on the foot by forcing capital outside of its country, capital that necessarily wants new investment opportunities, thus goes to great length to get them.

In the process they have impoverished to some extent part of their own nation to the benefit of crypto businesses in Japan, South Korea and elsewhere.

India is now seemingly thinking of going through the same process despite their people priding themselves of being a democracy, unlike China.

A peaceful battle of sorts is being fought in the world’s second most populous country as a court case challenging a diktat by India’s Central Bank has been halted by the government there which has promised an announcement of state policy on cryptos.

There’s some sort of power struggle, or so we suspect in any event, between the old bankers and the elected. Certainly in India and maybe also in China, but perhaps there was one even in US which the elected appear to have won with the assistance of the young bankers.

The people don’t care, of course. They route around. They go offshore. They mine it. They go peer to peer or they become proud criminals. For there’s a balance of powers on these matters. 51% isn’t just a technical term, but a description of what may well be quite an insight, regardless of the political system.


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Author: Trustnodes
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China: Cryptocurrency Mining Machines Reportedly Being Sold According to Their Weight

Cryptocurrency mining machines are reportedly being sold in China according to their weight as miners who haven’t been able to make a profit are seemingly getting rid of their old models to get some of their investment back.

According to local news outlet 8BTC, old ASIC machines like the Antminer S7, the Antminer T9, and the Avalon A741, have reached what’s being called a “shutdown price,” a price in which miners aren’t able to cover the energy costs associated with running these machines.

As such, they’re being sold for scrap metal and other parts. Per local reports, the miners are being sold for as little as one twentieth of their original value. While large mining operations are still running, small and medium-sized ones in China’s Xinjiang and Inner Mongolia are struggling.

Per the local news outlet, some miners are being sold for anywhere between $15 and $100. Initially, Antminer T9’s – which are currently being sold for little over $200 on Bitmain’s website – were going for over $1,500.

A video posted to microblogging website Twitter by the Managing Director of Danhua Capital, Dovey Wan, shows how the machines are being handled to then be sold:

While some claim the video was taken months ago, at a time in which floods in Sichuan affected cryptocurrency mining operations , the founder of F2Pool and Bixin Pool are said to have confirmed the video’s authenticity.

Notably, at the time of the floods Jiang Zhuoer, the owner of the prominent mining pool BTC.Top, clarified these had “little impact on bitcoin mining farms.” In a subsequent tweet Wan revealed that in China electricity costs are currently up for cryptocurrency miners, as some rely on hydroelectric dams.

Miners haven’t been able to make a profit as while energy costs are up, cryptocurrency prices are down. Bitcoin, the flagship cryptocurrency, saw its price drop from about $13,000 in January to roughly $4,500 at press time.

Per 8BTC, the term “miners sold by kilo” started trending on China’s top search engine Baidu after the founder of F2Pool tweeted out a picture revealing that some machines were being sold according to their weight.

In a Reddit thread where the above video was shared, some users discussed how the market’s downtrend has been affecting cryptocurrency miners. One, in particular, revealed he still uses his miner as “it’s cold and mining is cheaper than running a heater.”


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Author: Francisco Memoria
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Ripple Penetrates China with xCurrent, Collaborating with AmEx and LianLian Group

Ripple has succeeded in clinching its priority target market, China, through the approval of LianLian’s joint venture American Express, to process card payments in China.

China approved the operation of AmEx, making it the first American company to be given a direct access to the China e-commerce market. This approval empowers AmEx to resolve payments and transactions in Yuan. The settlement of payments can be done via its joint venture LianLian Group, which is Ripple’s customer.

AmEx. which is another global payment platform just like MasterCard had previously indicated interest in the Chinese market, presumed to be the biggest card market by recent analysis. This prompted its move into a joint venture with LianLian Group, and later became the first payment processing venture that operates outside the state-controlled, UnionPay network.

This joint venture, now partners with RippleNet, to provide seamless and faster global payment services to the Chinese e-commerce market. It can process and settle payments in Chinese Yuan Renminbi (CYN) currency unit. This can be achieved by establishing a network with its partner.

The venture which is named Express (Hangzhou) Technology Service Co. is expected by the Chinese government to complete preparation for operation within a year.

American Express and LianLian Group had been members of RippleNet. AmEx joined RippleNet late last year, with the aim of rendering better services to Small and Medium Enterprises in payment processing. LianLianPay which joined the platform early this year already has over 150 million registered customers.

Lian Lian uses Ripple’s blockchain to settle e-commerce payments in China, and also uses Ripple’s xCurrent to settle cross-border payments.

Ripple had been pushing to penetrate China market, now the government seems to have straightened out things for the fintech company.

According to a report from btcnews, a Ripple official stated that the digital asset company has been nursing the idea, and confident to hit China market before the end of this year.

From a report by btcnews.com early this year, Ripple’s head of government and regulatory relationship for the Asia Pacific, Sagar Sarbhai, said that it was still early to discuss such moves. He went further to say that Ripple would definitely launch its decentralized financial tools into China market to settle cross-border payment issues. He said;

“This year you will see more announcements coming in on China, in terms of educating and differentiating us from some of the other cryptocurrencies that are out there.”

Ripple CEO, Brad Garlinghouse, had said last year that “a launch into China was in the pipeline,” obviously there was a delay due to unclear regulations around the blockchain, and the digital assets, in China.

But the Chinese government just lifted the ban on blockchain and the use of cryptocurrencies. Now the use of digital assets is legalized, such that it is now an acceptable payment tool.

Irrespective of China’s strict regulations against ICOs, cryptocurrencies and foreign card-payment services, American Express defied these challenges to break into the country’s e-commerce market.

China’s e-commerce market has grown up to $627 billion more than last year. An estimate of the cross-border payments into the country is targeted at $1.32 trillion this year.

According to a report from a reliable source, some other card-payment companies have been lobbying for years to penetrate China’s e-commerce market. This is a very huge market, estimated to have six billion cards in circulation. A forecast shows it will increase to ten billion by 2020.

The Chinese government seems to be interested in the use of blockchain and DLT, which Ripple uses in its xCurrent and xVia products. China’s central bank sees this move as a very important way of showcasing China’s bank card market to potential foreign investors.

The central bank confirmed that this move would launch in a seamless operation in the country’s e-commerce market and draw in other payment institutions.

AmEx and LianLian are working in connection with Ripple, their operation can connect to xCurrent via multi-hop. This can also lead to a connection with Ripple’s xRapid later in the future.

The director of product at Ripple, Craig DeWitt, said that the incorporation of multi-hop, shows that the network will achieve a lot;

“Multi-hop gives Ripple members the ability to transact with banks or payment providers or digital wallets that they don’t have a direct relationship with. That’s important because in today’s world you need a bunch of bilateral relationships clunkily put together in a chain in order to move money. Multi-hop makes that thing of the past.”

Based on the current collaboration, it is expected that AmEx and LianLian joint venture would soon enter into an agreement with multi-hop to strengthen the network.

The Senior Vice President of product at Ripple stated that the network reach increased as more users signed on to xCurrent;

“xVia allows you to use one standard connection to get you all the benefits of RippleNet and our products. Without xRapid they would use xCurrent and where xRapid is available, they can then add on xRapid and move money on demand using XRP and payout instantly. They get reach wherever xCurrent is available, whether that be a bank [or] a cash payout provider.”

Ripple has been bullish in its crusade to provide a solution to the global cross-border payment issues. This, it hopes to achieve by launching its decentralized financial tools which can make payment processing a better experience across the globe.

Ripple extended its service to Japan in 2016, through a joint venture with SBI, to leverage on the upward trend in non-cash payment in Japan. It also targets to do the same in Korea and other Asia Pacific countries.

Last year, Ripple launched an office in Mumbai, India’s financial center, to render better payment services to India’s digital economy. India’s digital economy is estimated to hit $1 trillion by 2024. Ripple has moved in to provide a seamless payment platform for the banking system in the country.

Ripple has a big vision that may likely make it no 1 company in global payment processing. Well, Ripple may continue riding high as long as another bull doesn’t jump into the scene.


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Author:  Judith Riseshine
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China Opening up to Crypto

Despite China’s image as a no-go area for cryptocurrencies, a series of pro-crypto moves are opening up the forbidden kingdom to cryptocurrencies. Recently, a local court has now allowed merchants to accept Bitcoin as a payment method and recognized the cryptocurrency as a property thus allowing individuals to own and transact with it.

The move is surprising for many in the cryptocurrency industry and may open doors to a crypto future in the biggest manufacturing hub in the world. Gradually, China is working to legalize cryptocurrencies and open up their country just like it did back in the 90s that brought unprecedented growth to the region.

According to local Chinese reports, the Shenzhen Court of International Arbitration announced this landmark decision. However, it also passed the buck to the regulatory authorities as according to the ruling, Bitcoin ownership and transfer shouldn’t be in conflict with existing financial regulations.

According to the verdict: “CN law does not forbid owning & transferring bitcoin, which should be protected by law because of its property nature and economic value.”

As a consequence of this decision, circulation and ownership of Bitcoin are now legal and merchants can accept cryptocurrencies as payment without being in violation of the local law. While the law falls short of giving the same rights to Bitcoin as fiat currency, it is a step in the right direction.

Although the outside world believes that China has a blanket ban on cryptocurrencies, in reality, there is some adoption. The recent reality TV show on Chinese streaming channels follows the journey of a young woman who has to survive traveling around China with just BTC 0.2 in her phone. Watching the series, it becomes clear that China is progressing in the crypto world, with or without government intervention.

China is reportedly slowly opening up to Bitcoin and other cryptocurrencies as public penetration grows. Several hotels have started accepting payment in BTC (only from foreigners) while others are providing wide-ranging services in exchange for Bitcoin.

It appears that it is only a matter of time before China lifts the blanket ban on cryptocurrencies and allows unprecedented international trade through it.

Author- Tahla Dah

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Bitcoin and Crypto Adoption Spreading in China Despite Crackdown

Support of Bitcoin in China is heating up despite the government’s crypto crackdown in September 2017.

In addition to prohibiting commercial banks from servicing crypto-related businesses, local authorities enacted even more anti-crypto measures last month when they banned crypto companies from social media giant WeChat. Regulators also barred organizers of token sales and cryptocurrencies from promoting their offerings in public spaces, hotels and offices.

China also blocked 120 cryptocurrency exchanges that offer services to mainland residents.

Despite the efforts, China has been unable to curb crypto interest or stop adoption. Investors are still using over-the-counter trading platforms to buy ICO tokens as well as peer-to-peer crypto exchanges to make trades, buys and sells.

The first of its kind in China, “Ethereum Hotel” is accepting ETH as payment.

 

Adoption is playing out as Ethereum’s classification is challenged. Shanghai Hongkou District People’s Court ruled on September 27 that Ethereum is property. The ruling involved a “defendant Chen” who was ordered to return 20 ETH.

According to the judgment,

“The plaintiff now asks the defendant to return 20 ETH. The reason is justified and the court should support it according to law.

Regarding the opinion that the defendant stated that the country banned the circulation of the Ethereum and returned the lack of legal basis, the Court considered that the current state did not recognize the monetary property of the so-called “virtual currency” such as the currency, and prohibited its financial activities such as circulation for use, but It is not denied that the Ethereum can be equally protected by law as a property in the general legal sense. Therefore, the above opinions of the defendant will not be accepted by law.

Meanwhile, Beijing Science and Technology Report (BSTR) will now accept payment in Bitcoin (BTC) for its 2019 subscription to Technology Life, making it the first Chinese publication that allows subscribers to pay in BTC.

According to a local news report by Guangming Net, BSTR, the oldest tech mag in China, aims to promote blockchain and the adoption of cryptocurrencies.

Subscribers will be able to pay 0.01 BTC, roughly 450 yuan, by sending Bitcoin directly to the newspaper’s wallet address. They’ll also receive some BTC if Bitcoin increases in price by the end of the subscription period, as the publication pledges to forward gains to its subscribers as compensation for risking payment with the volatile asset.

According to a report by South China Morning Post, industry insiders say that technically “it would be a huge challenge for the regulators to completely block access” and stop crypto activities “as long as a trading platform’s servers remain outside China, and transactions are conducted peer-to-peer and remain decentralised.”


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Author: Daily Hodl Staff
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