Over $50 Billion in Tether (USDT) Moved From Chinese Borders in 2020

HashFlare

ComputerUniverse Введи промокод FW7FRUX при покупке и получи скидку 5 евро

China-based Tether addresses accounted for over $50 billion in transfers outside the country’s borders this year, according to a report by on-chain analysis firm Chainalysis.

Tether finds Takers

Tether, the fourth-largest cryptocurrency by market cap, is a stablecoin said to be backed  1:1 with the USD. And while its common use-cases range from moving funds across crypto exchanges to serving as a store of value, Chainalysis pointed out that circumventing border regulations has found its takers as well.

“Over the last twelve months, with China’s economy suffering due to trade wars and devaluation of the yuan at different points, we’ve seen over $50 billion worth of cryptocurrency move from China-based addresses to overseas addresses,” said Chainalysis.

Chinese regulations against capital flight are strict. The country allows individuals a maximum of only 345,330 yuan(about $50,000) for purchase at a financial institution each year. This is to quell big yuan-to-foreign currency conversions.

And while citizens have historically relied on real estate purchases in foreign lands—and even paintings—to move their savings, cryptocurrency is now serving as an option, the firm said.

Chainalysis noted that using Tether allowed users to avoid the volatility associated with Bitcoin and other cryptocurrencies, especially when billions in assets are being moved.

To illustrate, if someone in China sent $1 billion worth of Bitcoin outside borders and the asset dropped 10% in the process, the receiver would get only $900 million—a massive cut of $100 million.

Bitcoin miners and Traders Move USDT

However, not all of them moved funds were necessary to evade regulations, noted Chainalysis:

“Obviously, not all of this is capital flight, but we can think of $50 billion as the absolute ceiling for capital flight via cryptocurrency from East Asia to other regions.”

The report added that China’s famed Bitcoin miners — which control over 60% of Bitcoin’s hash rate and earn billions in revenue each year— may also account for some of the Tether conversions. Mining businesses are capital-intensive, and miners regularly cash out to cover the huge costs involved.

The report concluded that Chinese citizens, traders, and the country’s Bitcoin miners moved billions using Tether this year, in a move that hinted at capital flight.

Like BTCMANAGER? Send us a tip!
Our Bitcoin Address: 3AbQrAyRsdM5NX5BQh8qWYePEpGjCYLCy4