This weekly roundup of news from mainland China, Taiwan, and Hong Kong attempts to collect the industry's biggest news, including influential projects, changes in the regulatory landscape, and enterprise blockchain integrations.
Bad news for Evergrande
Even after all the regulatory crackdowns, China won't let 2021 slip away without a few more hits to the crypto markets. On December 9, the news revealed that massive real estate developer Evergrande had defaulted on its interest payments and was therefore subject to a credit rating downgrade.
Subsequently, the cryptocurrency markets fell significantly, which will be worrisome for investors who are already murmuring about unemployment rates and new variants of COVID. On the bright side, if the situation with Evergrande goes from bad to worse, financial regulators will be busy, giving them less time to focus on wiping out cryptocurrencies as we approach the last month and a half of the lunar calendar.
Bitmart bouncing
Bitmart was the unfortunate victim of a major hack on December 5, when $ 150 million was taken from a hot Ethereum and BSC wallet. CEO Sheldon Xia quickly jumped to Twitter and announced that hot wallets carry only a small portion of assets on Bitmart and that the exchange was conducting a comprehensive security review.
1/4 In response to this incident, BitMart completed initial security checks and identified affected assets. This security breach was mainly caused by a stolen private key that had two of our active wallets compromised. Other assets with BitMart are safe and unharmed.
- Sheldon Xia (@sheldonbitmart) December 6, 2021
While many Tier 2 exchanges might have reacted slowly, to Bitmart's credit, it was communicated very frequently throughout. The next day, Xia returned to Twitter to announce that Bitmart's other assets were safe and that the exchange would compensate affected users with its own funds. For an established exchange, this amount of loss wouldn't be too crippling, especially if the remaining users didn't all fold at once.
Immediately after the news, the Chinese community showed their resistance. Rather than rack up misery, numerous voices spoke out in support, including competing exchanges such as MEXC, KuCoin, and Coinex. Most of them left encouraging comments on Twitter in addition to notices that they would work with Bitmart to identify and blacklist the funds from the stolen account. Prominent investor Fenbushi Capital also voiced support, as did auditors Certik, Peckshield and Hacken.
Trust is the cornerstone we value. We applaud your team's quick action on the incident, the high level of commitment. "The proper response, as Hanukkah teaches, is not to curse the dark but to light a candle." @BitMartExchange @sheldonbitmart https://t.co/qsquPg1IuL
- Fenbushi Capital (@fenbushi) December 6, 2021
Trends in social media
Sequoia Capital, one of the world's largest venture capital firms with more than $ 5 billion in AUM, revised his Twitter bio into crypto-native language on December 8.
“Mainnet tap. We help daring legendary DAO builders from idea to token airdrop. LFG ".
Shortly after, screenshots emerged from the head of Sequoia Capital China indicating that the company was committed to cryptocurrencies. Feng Bo, who is a managing partner at Dragonfly Capital, applauded the move and noted its progressive approach.
While a company like Sequoia is unlikely to be truly committed, it's no secret that many of these large venture capital firms have enjoyed a lot of success through crypto-related investments of late. Perhaps the bigger question is which user was leaking screenshots of this seemingly private group chat for great Chinese whales.
Despite all the fun, Sequoia changed her Twitter bio the next day.
Also very popular on Chinese crypto social media was the eloquent Brian Brooks of BitFury. Clips from his panel at the US Congressional hearing on Digital Assets circulated, particularly when he explained the differences between Web 1.0, 2.0, and 3.0. The Chinese community seemed to appreciate his well-spoken and concise nature when dealing with featureless politicians.
For a bit of light humor, circulated an image of CZ's famous Tweet "If you can't hold on, you won't be rich" posted on the back of a Meituan food delivery vehicle. Meituan delivery is often seen as a low-paying form of employment that members of the crypto community could be forced to return to when the industry is suffering, similar to McDonald's in the west. It also pokes fun at a famous orange vehicle driven by one of the first Bitcoin whales in China that has the same message on the side door.
Crazy about the metaverse
Projects and events related to the metaverse have been popping up left, right, and center, all over China. However, it's unclear if these are really focused on building a Metaverse, or just a sneaky way for crypto projects to disguise themselves as something else to avoid the wrath of regulators.
The Central Bank of China has noticed this trend and is now monitoring the Metaverse and NFT space. The guidance or policies of the Central Bank are likely to resemble existing policies towards digital currencies, which means strict regulations with little room for interpretation.
Speaking at a financial security summit, the Anti-Money Laundering Director of the People's Bank of China mentioned the Metaverse and the NFTs when discussing the need to strengthen digital transaction monitoring. He also pointed out the need for regulatory sandboxes, a popular idea, but unlikely to bring much flexibility to truly decentralized products.
These rumors did not stop People's Daily from adding "metaverse" to a list of the Top Ten Trending Words of 2021 on December 8. Most of the other words were related to social problems, such as overworked students or young adults not trying to compete and be successful. Metaverse stood out among the other words as one of the only words related to technology and innovation.
On Hong Kong Island, Adrian Cheng, CEO of Hong Kong real estate giant New World Development, announced that he would go ahead and buy a premium property at The Sandbox. Cheng announced that 10 different companies would be used to develop the virtual earth, creating an innovation hub to showcase developments in the Hong Kong, Macao and several nearby Chinese cities.
