# China is watching...and it doesn't want to lose. Source: https://blockchainasia.substack.com/p/china-is-watchingand-it-doesnt-want Kiwi News: https://news.kiwistand.com/stories/China-is-watchingand-it-doesnt-want-to-lose?index=0x675179e62e03436ba8c43cd4d2de4ec61c2d8b97f276aebd26486232fd4c509a35b84cb8 Submitted by auditless.eth on 2024-12-05 UTC, 7 upvotes, 3 comments ## Summary Coco Kee writes that China is preparing to re-enter the crypto space and does not want to fall behind, based on her first trip to Hong Kong and Mainland China since 2019. She reports that the 10th Wanxiang Blockchain Summit in Shanghai drew roughly one-third of 2019 attendance, with speakers now almost exclusively Asian and discussion centered on stablecoins and RWA tokenization rather than cryptocurrencies. She cites a South China Morning Post interview with Dr. Feng Xiao, Chairman of HashKey Group, who suggested Trump's pledge to support crypto and sanctions on Russia via SWIFT could catalyze China's policy shift, with legalization of crypto assets possibly within two years. ## Article Welcome back to World Ledger. I am Coco, and I've just returned from my first visit to Hong Kong and Mainland China since 2019, before the pandemic. The landscape has shifted. Let me share a bit about what I learned. Audio playback is not supported on your browser. Please upgrade. The view of Hong Kong in front of me was stunning. I had almost forgotten its beauty. My arrival timing was significant: both Hong Kong and Mainland China's stock markets had hit historic lows. The Shanghai Stock Exchange (SSE) Composite Index hovered around 2800, while the Hang Seng Index struggled to find its footing. "Is the bottom in?" This question partly drove my visit. Even before I left Hong Kong, both markets rocketed upward after China's central government announced measures to boost the economy - or more precisely, to stimulate the stock market. My Hong Kong contacts shared a common sentiment - while no one could predict if the bull run would last, they felt things couldn't get worse. During my stay, I met with Chinese entrepreneurs and investors from Shenzhen, Thailand, and Singapore, alongside Hong Kong locals. The diversity and ambition of ongoing projects were encouraging. The ease of coordinating these meetings highlighted Hong Kong's unique position as a natural nexus for the region's Web3 ecosystem, a vision the Hong Kong government embraces. The city's geographical advantages are clear: high-speed trains connect it to Mainland's tech hubs like Shenzhen and Hangzhou, and most Southeast Asian destinations are just hours away by air. However, some hurdles persist. A recurring concern was Hong Kong banks' reluctance to serve the crypto industry - unfortunately mirroring the situation in the U.S. and elsewhere in the world. I also discovered that Hong Kong's legislators had been closely watching the U.S. regulatory direction. Once a follower of the U.S., they felt discouraged and adrift in recent years, given America's hostile stance and extensive legal enforcement against the crypto industry. After Hong Kong, I took the northbound speed train to mainland China. For the first time in many years, I witnessed a transformed nation. The people I interacted with were no longer the confident, ambitious ones; they were frustrated and lost. Taxi drivers spoke candidly about their struggles. Upon learning I was from the U.S., some confided their desires to move there. "It's getting harder to make a living here," they admitted. During my visit, China conducted one-day military drills around Taiwan, adding to the complex geopolitical tensions. Yet, amid these challenges and ongoing tensions with Taiwan, bright spots emerged. The SSE Composite Index's overnight recovery helped lift spirits. China's infrastructure development continues impressively - more extensive speed train and subway networks than five years ago, streets filled with electric vehicles and ubiquitous charging stations. In infrastructure, China can undeniably claim victory over the U.S. Kevin M. Goldstein on a fireside chat about U.S. regulations and election A highlight of my trip was attending the 10th Wanxiang Blockchain Summit in Shanghai. KGA’s co-founder Kevin Goldstein was invited to speak at the summit. Compared to the electric energy of the 5th summit in 2019, this year's event was notably subdued, with attendance at roughly one-third of 2019 levels. The speaker list, once global, now features almost exclusively Asian voices. To give you some context. Since 2019, China's central government has cracked down on Bitcoin mining and banned citizens from crypto trading with local and foreign exchanges. Interestingly, state-owned entities have since taken over some mining operations, explaining why roughly 20% of hash power still originates from China. The summit's discussions centered on blockchain technologies and applications like stablecoins and RWA tokenization, carefully sidestepping cryptocurrencies. The Chinese audience, which included both companies and government officials and regulators, showed keen interest in U.S. regulatory developments and the presidential election ( I was there before the election). A recent report dated Nov. 12 in the South China Morning Post deserves more attention. It highlights an interview with Dr. Feng Xiao, Chairman of HashKey Group, who suggests in his interview that Trump’s pledge to support the crypto industry and the sanctions on Russia via SWIFT may be the catalysts for the shift in China's crypto policies. Dr. Xiao estimates that the legalization of cryptocurrency assets in China could arrive within two years, otherwise, it could take up to five or six years without those catalysts. My trip helped connect the dots: China's central government never truly abandoned the crypto industry. It has established and maintained a tight grip on Bitcoin mining. As many have speculated, Hong Kong serves as a testing ground and development hub for its next strategic moves. The message is clear: China is getting ready to enter the ring…and doesn't want to lose. I am Coco Kee, author and host of World Ledger with Coco Kee newsletter and podcast, a rebrand from BlockchainAsia, the Co-founder of Kee Global Advisors, and a dog lover with a Goldendoodle Lucy. Follow me on LinkedIn | X: @CocoKee or email me: worldledger@substack.com World Ledger with Coco Kee podcast is available on Substack Podcast and most, if not all, podcast platforms, such as Apple Podcasts, YouTube Podcast, Amazon Music Podcasters, Overcast, CastBox, iHeart Podcasts, Goodpods, and more. The content in the newsletter and podcast is for informational and educational purposes only, represents personal views and opinions, and does not constitute investment advice or recommendations. ## Comments **macbudkowski.eth**: Have you heard about any interesting crypto apps from China? I found WeChat very fresh compared to its Western web2 counterparts, so I wonder if they have an equivalent in web3. **tim**: I actually used WeChat in 2019 when I was in Kiwi and I didn't like the experience. E.g. Mobike and other apps were hosted on WeChat as web views and they felt very cheap and janky. WeChat would have never managed to compete with these apps in the west, which was further already on UX etc. Not sure how it is now ofc **misha**: I think Chinese gov is bullish on the e-CNY app :) https://apps.apple.com/hk/app/e-cny/id1571652872?l=en-GB I have used WeChat in China, my take is that the app is more convient for Chinese gov than for citizens. It is like a total lock-in and privacy nightmare. But yes, if you live in China it makes live easier, actually it's prob hard to live without it.