Hot Topics
Coin Gecko

Advertisement

Advertisement

Chinese digital currency is a blessing for the Australian government

 
Chinese digital currency is a blessing for the Australian government
Breaking News / Crypto Market

Most of the financial world, regardless of which sector they are targeting are in full anticipation of the Chinese digital currency which is being developed as a direct counter to Facebook’s Libra which has the potential to be the most influential medium of exchange all over the world.

Despite the fact that most governments are unsure whether or not they should allow Libra to roam free, it may be their only salvation against the Chinese digital currency currently in development.

 

 

 

However, there is a serious anomaly in the market right now. As there is a democratic nation that could potentially benefit from the PBoC’s digital currency. That digital nation is Australia which is relatively close to Mainland China. In order to determine why the Chinese digital currency is such a blessing for the Australian government, we need to look at some backstory and the connection between these two countries.

The financial connection between Australia and Mainland China

Besides all of the FDI that is coming from Mainland China, Australia is a serious hub for laundering money. What I mean by this is that Mainland Chinese investors or wealthy individuals have a very hard time to truly take funds outside of the country without the government’s approval.

This is especially the case when it comes to “immoral” industries such as wagering, in which Australia is a leading country. In fact, there’s a specific law that prevents Mainlanders from taking out more than $3000 from the country for a specific trip outside of the borders. If there’s a business venture it needs to be noted as such so that the amount of funds that are clarified for “export” is increased.

Many would think that it’s easy for Mainlanders to simply go for a fake business trip somewhere, purchase real estate or invest in something and then sell it and launder money that way. But, under Chinese law, it all needs to eventually come back to the country in one way or another.

However, Australia is a little bit different in this case, as it has found the most optimal way to allow Mainlanders to launder millions of Yuan outside of the Mainland and “invest” it in Australia somehow.

According to experts from Casinos-Australia.net, the reality is completely different from what is “reported” in the media or documented for the authorities.

The news pieces that we see about Mainlanders coming to Australia and investing millions of dollars are not necessarily always true. It’s usually a deliberate set-up event where the Chinese investor somehow legitimizes their investment with the authorities back home. What’s really happening is that the investor starts to qualify for Australian citizenship and is slowly moving his or her wealth outside of China.

This is the most common case, but it’s important to remember the cases that are not necessarily reported too much.

Casinos in Australia have very elaborate marketing strategies in the mainland, mostly targeting wealthy players. They entice them to come to Australia with private jets in order to avoid customs, and then help them legitimize their funds through an exchange of chips, and then another exchange into AUD.

Online casinos participate in this as well. They usually introduce themselves to these Chinese players as a Bitcoin or some kind of crypto casino and only allow them to deposit through cryptocurrencies. It helps hide the tracks from the CCP and usually works.

But the methods that have become a staple for money laundering outside of Australia are about to be crushed by the Chinese digital currency.

PBoC will utilize the CBDC for foreign funding?

Once the Chinese Bank Digital Currency (CBDC) is launched, it’s expected that the Chinese Communist Party (CCP) will start making arrangements with almost every country in the world to allow the withdrawal of this digital currency in various fiat money.

What this means is that, if a Chinese national leaves China with $3000 worth of the digital currency on their account, they can simply withdraw it through an ATM for the local currency of the country they will be visiting.

This will ensure that money laundering of cash will start becoming even harder as less of it will be used in circulation.

By removing cash out of the equation, the CCP gets full, uncontested control of who spends what, how much and where. The money laundering cases of wealthy mainlanders investing in foreign markets will be completely removed.

What does the Australian government like this?

It’s likely that the AUD will suffer from this hit, as the billions of dollars coming in “illegally” through China was really helping in maintaining the currency’s strength as the demand was constant.

So why would the Australian government like the idea of losing so much demand on local currency? Because there are always an alternative, legal methods to ensure stability.

The reputation of a legitimate investment location though could prove priceless in the years to come as Chinese influence increases. Should Australia continue catering to mainlander money launderers, it’s possible that FDI from China will decrease significantly.

With the CBDC, the Australian government won’t even have to lift a finger as it will all fall under the control of the CCP to maintain control.

Whether or not that’s a topic to be happy about remains to be seen though.

You can share this post!