Chainalysis Reports Crypto Might Play Key Role in Capital Flight
Chainalysis report claims that in East Asia, 44% of crypto transactions are conducted within the region only. It also claims that in the past year, East Asia’s share of global crypto activity has declined. Crypto worth $50 billion has left China. During the time, when Beijing imposed a ban on direct conversions, USD backed Tether played a significant role. Traders in the Chinese market have used Tether as a major stand-in for fiat.
Chainalysis states the reason why holdings are moved overseas
Chainalysis reported that in the past year, Tether worth $8 billion has been transferred to foreign addresses originating from the East Asian market. A lot of analysts have specified that the US-China trade war must be playing a major role in this fund movement. Beijing has also restricted its citizens from moving funds equivalent to or more than $50,000 overseas.
The government has also cracked down on the routes for offshoring capital, and because of this, cryptocurrency has become the only alternative.
Dovey Wan, the founding partner of Primitive Ventures, has said that President Xi has only talked about blockchain and not any crypto. This directly indicates that there will not be any state-sanctioned crypto other than Digital Yuan.
Max Keiser, a famous American broadcaster, has said that a lot of geopolitical tensions are leading capital flight out of Asia. However, his primary focus was towards Bitcoin, and he did not talk about the Tether or any other crypto.