The Era of Petro Yuan Is Coming With Blockchain
블록스트리트 등록 2022-12-26 16:27 수정 2022-12-26 16:40
# 'Petro Yuan' Emerged in Conjunction with The Release of Stablecoin Pegged to Chinese yuan
This month, Tether, the No. 1 stablecoin issuer in the market capitalization, has begun to promote the news of CNHT issuance in earnest. CNHT is an stablecoin pegged to offshore Chinese yuan.
Although they released the CNHT in 2019, they has left it unsed for around three years. However they announed they will distribute CNHT through Tron blockchain network(TRC-20), the world's largest blockchain trading network. Since May, Tron has surpassed Ethereum (ERC-20) to become the largest distribution network for tether.
The world's No. 1 stablecoin issuer began distributing the stablecoin pegged to the offshore Chinese yuan through the world's largest distribution network and began massive promotion at the same time.
It wasn't just Tether. About 10 days after Tether's full-scale announcement of CNHT issuance, TrueUSD, the sixth-largest stablecoin issuer in the market capitalization, also announced the release of TCNH, an an stablecoin pegged to offshore Chinese yuan.
An interesting incident occured while the stablecoin issuers have announced the news of issuance of the stablecoins pegged to Chinese yuan.
Xi Jinping, president of the People's Republic of China, pushed to train in Chinese yuna for crude oil exported by six Gulf countries, including Saudi, heralding the era of 'Petro Yuan'.
The formula 'dollar for crude oil trading' was an unwritten rule in the international community after the 20th century. However, the complicated interests of the international situation have led Saudi Arabia to turn its back on the United States. China has stepped into the gap and challenged the opening of the era of Petro Yuan, which broke the formula of "Petro Dollar."
Considering the economic and security situation surrounding Saudi Arabia, China's proposal, and their interests, it is predicted that the opening of the Petro Yuan era has high potential.
# Why Offshore Chines Yuan?
The 'offshore Chinese yuan' is a yuan used in areas other than mainland of China under the unique policy of the Chinese government, which has not fully opened the foreign exchange market. If 'onshore Chinese yuan' means thoroughly 'domestic demand' Chinese yuan, offshore Chinese yuan means the Chinese yuan used for financial transactions with foreign companies such as imports and exports.
At a time when the era of Petro Yuan is slowly about to appear like a mirage, the issuance of stablecoins pegged to offshore Chinese yuan by large stablecoin issuers could be interpreted as a strategy that thoroughly recognizes the era of Petro Yuan. In other words, the business was developed under the calculation that the stablecoins with high utilization would be applied to crude oil transactions.
# China's Foreign Exchange Hong Kong Opens To Cryptocurrency Again
Another thing to pay attention to is the fact that Hong Kong announced the reopening of the cryptocurrency market in October.
Hong Kong has long played a role as a hub of Chinese finance and a foreign exchange exchange since its return to China.
Regarding this fact, Arthur Hayes, CEO of Bitmex, a large cryptocurrency derivative exchange, analyzed in a column titled 'Come Back' that the changes in Hong Kong's cryptocurrency policy are connected to China. He pointed that the positive change of Hong Kong's financial authorities on cryptocurrency is a test for the Chinese government's return to the cryptocurrency market. And he also analyzed that when China returns to cryptocurrency, a huge bullish market will come again, and Hong Kong's recent policy changes mark the bud.
The main use of offshore Chinese yuan exists in many parts of the world, including Singapore, London, and New York, but Hong Kong is by far the biggest use.
# Justin Sun of Tron, Justin Sun of Huobi
Justin Sun, the founder of Tron, CNHT's distribution network and the de facto president of Huobi, the largest exchange that announced the listing of CNHT, left an interesting comment.
Justin Sun posted a message on his Twitter account on the 7th that "Next crypto bull market will depend on the Chinese."
Tether's influence on stablecoin market is truly enormous beyond the No. 1 stablecoin in market capitalization. Tether (USDT) is used as a major key currency for purchasing cryptocurrency such as casino's 'chip' on the global cryptocurrency exchange, and Tether currently accounts for 70% of all stablecoin transactions.
As the founder of a financial network provider that issues CNHT and de facto president of the exchange leading the CNHT transaction, Justin Sun revealed a clear conviction.
# Why Is Petro Yuan the Stablecoin Pegged to Chinese Yuan?
If China succeeds in negotiations with six Gulf countries, including Saudi Arabia, and opens the era of the Petro Yuan, which it had longed for, there are two major channels for Chinese yuan transactions that the trader can choose. As China opened the era of Petra Yuan by shouting "de-dollar," it is difficult to say that China would continue to use the dollar-led SWIFT.
One of them is The digital yuan (e-CNY) pegged to Chinese yuan with the digital yuan payment network 'CIPS', a financial network developed by the Chinese government.
Among the two options, Chips is hard to show great preference due to China's political, diplomatic moves, and lack of soft power. As such, oil-producing countries are likely to prefer the stablecoins pegged to Chinese yuan.
This is because the Petro Yuan was only a step away from the dollar due to complex international relations, but it is difficult to say that it is built by strong bond between traders due to complete faith in each other.
In the end, it can be interpreted that the option of oil-producing countries would the stablecoins pegged to Chinese yuan, which has both rapid transactions of the offshore Chinese Yuan and globality in its birth.
# The Correlation Between Petro Yuan and Cryptocurrency Bullish Market
Then, why is the Petro Yuan closely related to the rise of cryptocurrency?
First of all, given that Tron would be used as CNHT's distribution network, the more active CNHT is trading, the greater the price increase effect of the Tron network's native token 'TRX'. Whenever the Tron distribution network is used, the native token TRX enjoys an incineration effect in the name of a fee. And the principle is that the incineration volume is excluded from the total issued volume, increasing the rarity and eventually increasing the price of TRX.
Ultimately, the stablecoins only pegged to Chinese yuan, but it is essentially a cryptocurrency.
Considering that USDT is used as a key currency traded with other cryptocurrencies with investment value on the exchange, it is difficult to say that CNHT would also be fully converted into Chinese yuan.
All of this can be seen as the reason why Justin Sun, the de facto leader of Tron and Huobi Exchange, pointed out that China is the next leading player for cryptocurrency bullish market.
The seemingly unbreakable Petra Dollar formula is now in jeopardy. The issurance of stablecoins only pegged to Chinese yuan of stablecoin issuers, which used to focus on the stablecoin pegged to dollar, would a thoroughly calculated move.
권승원 기자 ksw@