How China Can Win

Not too late for China to win at the strange multi-front game theoretic implied by the last year and a half, post-Wuhan, post-COVID19 global meltdown.

Simply put, as the West moves toward possible total cataclysm — ingredients: irreconcilable political differences, a possibly faulty experimental vaccine rushed on the populace, the imminent Ghislaine Maxwell trial which could unearth decades of elite Western sleaze, near zero interest rates on bank deposits, and a sputtering economy all possible seeds laid for the bad harvest to come — China could reverse course on crypto unexpectedly, suddenly placing itself on an equal footing with financial centers like Switzerland, London, etc. that have gone full Enlightenment-mode on their long-term crypto tolerance.

China’s President Xi Jinping

It would come unexpectedly, and would leave Western financial markets reeling, at a time when regulators are trying to softly rope in Bitcoin’s growing dominance in online transactions (PayPal, Cashapp, and Venmo, popular with contractors and young people, now all let users buy/sell Bitcoin, and some other cryptos.)

The recent crackdown on crypto in the US, and complete inability of American regulators to approve a crypto ETF when now several other countries have done so (and one country, El Salvador, even making Bitcoin legal tender) should show China’s Xi Jinping and the Communist Party what they have wanted to see all along regarding peer-to-peer cryptographic money systems: that they aren’t some kind of uninvited 5D chess move from the Western intelligence community, or the banks.

It seems anything but. The Swamper angst surrounding Bitcoin’s recent success during the pandemic, and the hesitancy of Western fractional reserve banks to let transactions flow out of their coffers and into crypto, all seems quite genuine.

They’re doing their best to slow crypto’s march, and that may be enough for Xi to see strategic benefit in the old Complete Reversal, a tactic that is always at a large country’s disposal when dealing with policy governing such new and uncharted technological innovations.

No one saw crypto coming — but now that it has arrived, and won’t seem to leave — will China take the lead?

— FULCRUM Research