Saturday, July 13, 2019

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Study Exposes How Russia, Iran, & China Are Weaponizing Crypto

It’s no secret that foes of the United States – including Venezuela, Iran, Russia, and China – are experimenting with cryptocurrency technology as they seek to render their economies immune to crippling US sanctions.

However, a new study from the Foundation for Defense of Democracies (FDD) exposes the lengths to which these rogue nations are willing to go to make this a reality.

“For decades, U.S. adversaries have been trying to evade and undermine this power, but there has been no way to conduct significant international commerce without moving through the pipes of the U.S.-led global financial system. Now, however, new pipelines are being built,” the Foundation for Defense of Democracies (FDD) stated in the study.

Weaponizing crypto to resist US economic pressure

Iran, Venezuela, Russia, and China – four US foes affected by or constantly at risk of US sanctions  – go “beyond mere sanctions evasion” and develop alternative global commerce payments systems outside of US influence via blockchain technology and cryptocurrencies, the study reads.

According to the FDD – while they are exploring the development of their own state-backed crypto – China, Iran, and Venezuela also restricted access to the public cryptocurrencies that are currently available on the market.

“Russia, Iran, and Venezuela have initiated blockchain technology experiments that their leaders paint as tools to offset U.S. financial coercive power and increase sanctions resistance. China is also wary of U.S. financial power and the ever-present threat of sanctions against Chinese officials,” the researchers stated.

Venezuela’s ‘blockchain’ mess serves as a case study

But these endeavors have met with mixed success.

As Nicolas Maduro’s government failed to build the economic and technical infrastructure for Venezuela’s state-backed cryptocurrency, the Petro is useful to neither the South American country’s citizens nor its trading partners, the FDD argues.

Instead, the researchers deemed Petro more of a “propaganda effort than a technical or financial accomplishment.”

However, Venezuela’s case with its government-backed crypto should serve as an example for other US foes who are planning to develop their own digital currency, according to the FDD.

 “The petro’s shoddy implementation provided little more than a vehicle for regime propaganda rather than any technical or economic utility. And yet, Iran, Russia, and even China are likely to learn from Venezuela’s missteps,” the study reads.

Russia’s regional crypto, Iran’s Swift alternative, and China’s blockchain research

While Venezuela has failed to get its so-called “cryptocurrency” off the ground, the other three US adversaries are working hard to create their own crypto and blockchain-based economies.

According to the FDD, Russia seeks to lessen the impact of US sanctions by focusing on blockchain technology and including it as a long-term national security and economic goal.

With the goal of facilitating trade and investment outside the grip of the United States, Russian financial institutions are running multiple blockchain pilots. The country’s Ministry of Finance is also planning to develop a regional crypto with other members of the Eurasian Economic Union (EAEU).

As Iran has been hit hard by sanctions – bringing its crude oil export to a historic low – the country’s government is looking to create an alternative to SWIFT, the FDD stated.

According to the study, Iran is investing heavily in blockchain development with plans to create a national cryptocurrency, which would be used for domestic transaction settlement.

Another crypto is in the works in Iran by the startup Kuknos, in which the organization seeks to develop a gold-backed digital currency called Peyman that four Iranian banks would use initially to tokenize assets in the fiat world.

Aiming to neuter the USD as a global reserve currency and “displace” the US in the global financial system, China devotes much of its resources to blockchain research, as well as developing a national, state-backed cryptocurrency.

“Of all U.S. adversaries, China is best positioned to develop blockchain-based digital currency infrastructure that could compete with the dollar-based financial system,” the study says.

In addition to its state-backed crypto development, the People’s Bank of China (PBOC) and Chinese authorities are researching blockchain’s use for credit, finance, and real estate projects, as well as a blockchain-powered securities trading platform.

The US must take the lead in the ‘crypto race’

With Venezuela, Iran, Russia, and China building their “blockchain sanctions resistance,” it is crucial for the US to be in a leading position during the international “crypto race,” the researchers argue.

They say the United States needs to ensure that blockchain projects are developed in a way “that will expand the transparency, freedom, and prosperity of the last century.”

“The way forward is not to just consider the threats emanating from various types of fintech, but to think more creatively how the global financial system should adapt to technological change,” the study reads.

Trumps Fed Pick Isnt Just a Gold Bug – Shes Also a Crypto Bull

Sunday, June 30, 2019

Bitcoin Mining Exec Reveals the Key to Sustaining Cryptos Future | CCN Markets

Dow Rallies 7.2% in June: Trade Talks Resume, Market Sentiment Surging

As the U.S. and China resume trade talks following the highly anticipated G20 summit, the Dow Jones and the rest of the U.S. equities market have shown strong recovery.

In the past 30 days, the Dow Jones has rebounded from 24,819 points to 26,599 points, recording its best June in 81 years.

The Dow Jones is up 7.2 percent in June

The U.S. has paused the imposition of additional sanctions on Chinese goods and China is set to begin purchasing American farm products in the upcoming days, opening the conversation for a potential comprehensive trade deal.

Full trade accord unlikely but improving sentiment likely to fuel Dow Jones

Due to intensifying geopolitical risks, major economies in the likes of Australia and the eurozone have either already cut their benchmark interest rates or are planning to do so shall the slowdown of global economic growth continue.

On June 9, Reuters reported that European Central Bank (ECB) policymakers are open to dropping its policy rate if the eurozone struggles to revitalize as a result of the trade war.

“If inflation and growth slow, then a rate cut is warranted,” one source told Reuters.

With major economies gearing toward a rate cut in the near term, strategists including Evenflow Macro’s Marc Sumerlin said that the Fed is too tight and that a rate cut is expected to occur in July.

The expectations of a rate cut in the upcoming weeks and improving sentiment around the trade talks between the U.S. and China could act as catalysts for the ongoing rally of the Dow Jones and U.S. stocks in general.

Stephen Guilfoyle, President at Sarge986 LLC, said in an interview with Fox Business:

“Drivers [of the rally] would be a change in the perceived trajectory for monetary policy, coupled with a bit of optimism in renewed negotiations with China.”

However, there is opposition in resuming trade talks from both Democratic and Republican representatives due to the involvement of Huawei as a part of the deal.

A WSJ report said that U.S. President Donald Trump will allow U.S. companies to sell high-tech equipment to Huawei once again, which would effectively allow the firm to utilize various hardware and software that are crucial in building its smartphones and other popular appliances.

The ban imposed on U.S. companies from working with Huawei does not affect Huawei’s 5G technology, but it creates a difficult environment for the Chinese conglomerate to sustain the sales of its flagship devices that have started to obtain a large market share on the global stage.

“If President Trump has, in fact, bargained away the recent restrictions on #Huawei, then we will have to get those restrictions put back in place through legislation. And it will pass with a large veto-proof majority,” Senator Marco Rubio said.

Fears about U.S. stocks

The major concern of strategists in recent weeks amidst one of the strongest monthly rallies for the Dow Jones is that the upside movement may not be sustainable throughout the near to medium term.

Some worry that the trade talks are priced into the market. And with investors expecting the discussions to potentially last a long time, only a comprehensive trade deal would significantly improve the sentiment around the Dow.

Still, the momentum demonstrated by U.S. stocks in June has been strong in comparison to the latter half of 2018. And with President Trump continuing to place pressure on the Fed, there are hopes that a rate cut, even a minor change in policy, would improve the state of the market.

U.S. Market News Show

U.S. Market News Show

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