An up and down week filled with high volumes for animal tokens and a flurry of digital yuan news, capped by a large fundraising round for Babel Finance.
This weekly roundup of news from Mainland China, Taiwan, and Hong Kong attempts to curate the industry’s most important news, including influential projects, changes in the regulatory landscape, and enterprise blockchain integrations.
Memecoin culture clash
Feed the gorillas token, or FEG, was a source of drama after memes were posted of Chinese president Xi Jinping. The token claims to use its revenue to take care of gorillas and had been gaining attention among animal-related tokens, amassing a market cap of over $1 billion. Some Chinese community members found the meme offensive, and after not finding support from the team, began to abandon the project. The incident went viral and Chinese CeFi exchanges, including OKEx and Gate responded by delisting the token. The FEG price dropped around 75%, before rebounding slightly on May 13.
The community became divided, with one side claiming Chinese censorship was being forced upon the cryptocurrency community. In all likelihood, the decision to delist the token was probably more out of caution than outrage, as cryptocurrency exchanges operating in a legal gray area often find it advantageous to avoid being associated with scandal and controversy.
Digital yuan vs digital dollar
Algorand uploaded a webinar on China’s progress in the CBDC space on May 13. The event was hosted by China’s Blockchain-based Service Network, and included Algorand Foundation CEO Sean Lee, Tezos’s David Shin and Charles d’Haussy from ConsenSys. All the panelists spoke positively about the approach China had taken with CBDCs, focusing on the marketing and incentivization that has ledeading to pilots being run with banks, businesses and tech companies all over the region.
While discussing the challenges of rolling out a CBDC, the panelists also contrasted the public style of the digital yuan development with that of the US. Shin suggested that despite a lack of publicity, the Biden administration has been briefed on the progress of other nations in this space, and hinted that the US might not be as passive as they might seem. The US dollar holds a strong position over other national currencies, allowing the US more flexibility and patience in how they deploy new technologies, as there is less pressure to make the first move. China, on the other hand, has a lot more to gain by increasing the utilization of the yuan in international scenarios.
Alipay is also allowing users to get involved with the CBDC tests according to Cointelegraph. The financial services app has been playing an early role in testing, but this is one of the first indications that retail users might soon be able to get their hands on the digital yuan directly via the app. On May 13, Cointelegraph also reported on Hong Kong Monetary Authority giving the green light to continue testing on using the digital yuan for cross-border payments.
Babel closes $40m round
Babel Finance, one of the largest crypto institutions in China, announced the completion of its $40m series A fundraising. The company offers lending, trading, and other financial services to institutions and high net worth individuals, making it an important part of the Chinese investment ecosystem. The round included contributions from Zoo Capital, Sequoia Capital China, Dragonfly Capital, BAI Capital and Tiger Global Management.
Unbanking the banked
Large commercial institution China Citic Bank announced accounts at the bank could not be used to trade cryptocurrencies like BTC. It listed a number of reasons, including guarding against money laundering, defending the legal tender status of the yuan and protecting the social public property rights.