China’s Crypto Awakening?

Block 1: Essential news

  • Binance is on all fronts

Everything seems to be smiling on the crypto giant. First, Binance has just registered with the Swedish Financial Supervisory Authority (FSA) to continue its regulation in Europe, doing so in seven EU members, including France. Deuxio, Binance.US, the American arm of the platform, has announced that it is buying the assets of the bankrupt Voyager Digital platform for $1 billion, which will allow Voyager customers to recover some of their deposits blocked by the process of bankruptcy. . Third, Binance has announced that it will recruit 3,000 people in various positions for 2023.

  • Blockchain Avalanche is partnered with Amazon

It is more precisely the cloud computing platform of the giant across the Atlantic, Amazon Web Services (AWS), which has proclamation partner with Ava Labs, the company that develops Avalanche’s blockchain, with the main mission “Accelerate blockchain adoption by businesses, institutions and governments”. The goal is to bring the entire Avalanche ecosystem (decentralized applications, network nodes, subnets, etc.) directly to AWS. We’ll see more specifically in the coming months how this partnership materializes, but it raises questions about a possible gradual centralization of Avalanche’s network in Amazon’s hands. The decentralization of networks is a dear feature in the eyes of cryptosphere enthusiasts.

  • Blockchain Polygon partners with Mastercard

After forming partnerships with well-known companies such as Disney, BMW, Mercedes, Adobe, Adidas and Starbucks, Polygon has teamed up with payments giant Mastercard. It was during the Consumer Electronics Show (CES) in Las Vegas that the company announced the launch of an accelerator dedicated to music artists. So what’s the connection to Polygon? The accelerator will include a limited edition NFT called “The Mastercard Music Pass” which will give holders access to “exclusive hardware, unique resources and other physical and virtual experiences.” This collection will be supported by the Polygon blockchain. More concrete details will be provided in the coming months. But this again proves Mastercard’s desire to gain ground in the crypto sphere.

Sam Bankman-Fried, the disgraced former head of FTX, has denied hiding billions of dollars and offered his views on what happened to his bankrupt platform in a new. long post on Substack released on Thursday. He denied stealing the funds and claimed that FTX and its sister company Alameda Research collapsed due to the crypto market crash and inadequate coverage by Alameda. “I did not steal funds and I certainly did not hide billions of dollars,” Bankman-Fried writes. Later in the post, he concludes that “Alameda lost money because of a market crash it wasn’t properly hedged against.” While claiming the trading firm “failed to adequately hedge its market exposure”, he also said it “has not run Alameda in recent years”. We should still have some strange explanations from the SBF until his judgment date, October 2, 2023.

  • Coinbase is laying off 950 employees

After being forced to pay $100 million last week to settle with regulators, the US crypto platform announced this week that it was laying off another 950 employees, knowing it had already laid off 1,100 six months ago. Coinbase also mentioned that it will abandon projects deemed to have “low probability of success” in order to reduce expenses. As evidenced by the chart below, Coinbase has bumped into the Crypto.com platform when it comes to layoffs since 2022.

Number of layoffs in crypto-related entities
Bloomberg

Block 2: Cryptic analysis of the week

The administration of President Xi Jinping has taken favorable measures in the market in recent days, such as the easing of policy towards the tech giants and the strengthening of the real estate sector. Given these changes, could cryptocurrency policy change as well? Some crypto optimists see this as a real possibility. This is especially the case of self-proclaimed crypto-billionaire and blockchain founder Tron, who expresses his enthusiasm on Twitter

After all, in recent months Hong Kong has given priority creating a virtual asset center, all under the watchful eye of Beijing. There has even been talk of the possibility of an identification program that would allow Chinese people to access cryptocurrencies through Hong Kong.

Julia Leung Fung-yee The chief executive of Hong Kong’s Securities and Futures Commission (SFC) announced that the securities watchdog will offer a range of digital assets that will allow retail investors to trade. Hong Kong’s decision to allow retail cryptocurrency trading comes after months of turmoil in the industry, with the collapse of cryptocurrency platform FTX the latest blow.

“Over the past year, virtual assets have gone from highs to lows (price). The good thing is that when the sludge is removed from the system with the collapse of platforms and some tokens, it focuses the minds of investors and sellers on doing protect investors,” Leung said during a panel discussion at the Asian Financial Forum in Hong Kong on Wednesday.

The SFC will start accepting applications for Virtual Asset Service Provider (VASP) licenses in mid-2024, Leung said. The new cryptocurrency regime requires all trading platforms and exchanges to apply for a license or face fines and jail time.

Many China watchers will dismiss these speculations as far-fetched. In addition to the catastrophic fallout from the FTX debacle, policymakers are still wary of issues such as wasted energy in cryptocurrency mining and the risks of cryptocurrency speculation.

However, even a partial easing of restrictions by China would be a boon to the industry, a boon tempting enough that crypto-miners, crypto-traders and crypto-investors are pinning at least some of their hopes on it.

Dreams of a China-led renaissance may be nothing more than a triumph of hope over reason. But optimists can still look forward to Ethereum’s next upgrade, which is expected to happen in March. Her name ? Shanghai. We will detail the challenges of this upgrade in a dedicated article.

Block 3: Tops and Flops

The evolution of the top 20 cryptocurrencies in terms of capitalization during a week.
(Click to enlarge)

Crypto heat map

Determine the quantity

Block 4: Readings of the week

FTX crashed the crypto party in heaven (By wire)

Six OpenAI rivals are being eyed by Google and Microsoft (Information)

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