Finance

China is rolling out the red carpet

Published

2 years ago

March 6, 2023

BEIJING — China is pulling out all the stops to keep multinationals like Apple and its supplier Foxconn in the country.

Such efforts to attract foreign investment come as the pandemic and geopolitical tensions push companies to diversify their supply chains away from China.

For the first time in 25 years, the American Chamber of Commerce in China found that less than half the respondents to its annual survey ranked China as a top three investment priority. The number of companies which are considering or starting to relocate their manufacturing and sourcing outside of China rose by 10 percentage points from a year ago, the survey found.

The majority of respondents don’t plan to relocate their supply chains, the AmCham report said.

The survey was conducted last fall, and results hadn’t changed significantly since China ended its stringent Covid controls, AmCham said. China’s Commerce Ministry didn’t respond to a request for comment.

After such a drop in sentiment, China is working hard to keep foreign businesses investing — and supporting domestic growth. The Commerce Ministry said Thursday that for the first time, it would launch events for an “Invest in China Year.”

‘Action-reaction cycle’ between the U.S. and China is a problem, professor says

In a sign of how hard local governments are trying to attract foreign dollars, top officials from Henan province in central China personally welcomed Foxconn Chairman Young Liu last week during his visit to his company’s factory there, the province announced.

Foxconn operates the world’s largest iPhone manufacturing facility in Henan’s capital, Zhengzhou.

The party secretaries of both Zhengzhou city and Henan province met with Foxconn — along with the mayor and governor, state media said. In China, the ruling Chinese Communist Party takes the lead in decision making, and such high-level participation in the meeting with Foxconn indicates any matters discussed can be implemented more quickly.

During a Covid outbreak and subsequent lockdown last year, Foxconn’s factory in Zhengzhou became a hotspot of attention when some of its roughly 200,000 workers decided to leave and walk home.

Apple later said the Zhengzhou factory disruptions would delay deliveries of some iPhone 14 models.

China ended its stringent Covid controls in December. By February, Foxconn’s Zhengzhou factory was producing at full capacity, with staff working two shifts to meet high client demand, factory manager Wang Xue told local media.

Foxconn confirmed its chairman visited Henan and planned to collaborate with the local government on projects. But the company did not share details on those investment plans, or whether they have any intention to shift production out of China.

China says other companies are coming

China is eager to play up how other multinationals are interested in local business opportunities, especially now that international borders have reopened.

Senior executives from Apple, Pfizer and Mercedes-Benz are among those wanting to visit China to discuss business, the Ministry of Commerce spokesperson said at a press conference last week.

The spokesperson noted there are dozens of multinational corporates talking to the ministry about such high-level visits.

Mercedes-Benz confirmed to CNBC its CEO Ola Kallenius is planning to visit China. Pfizer had no comment. Apple did not respond to a request for comment.

Overseas marketing tour

China is also visiting potential investors in their home countries.

After a top government meeting in December called for greater efforts to attract foreign capital, many government-led groups have traveled abroad to make sales pitches for China.

Wang Jinxia, deputy director of Qianhai — an economic development zone in Shenzhen — led a group to Dubai, Singapore and London in February to drum up investment interest.

He described the visits as achieving “remarkable results” — but did not elaborate. He also noted “serious challenges” to attracting foreign investment. Those include unfair competition with local players in China due to industrial policies, lack of legal protection for foreign business in China and geopolitical risks, Wang said.

The Biden administration has increased restrictions on U.S. business with China, such as curbs announced last year on U.S. businesses and individuals working with Chinese partners on the most advanced semiconductors.

It’s not clear to what extent other restrictions will be announced.

To be clear, international investment is still coming into China at a steady clip.

Foreign direct investment rose by 14.5% in January from a year ago to 127.69 billion yuan ($18.39 billion), according to China’s Ministry of Commerce. That’s faster than the 6.3% increase for all of 2022.

South Korea, Germany and the U.K. were the largest sources of such foreign investment in 2022, the ministry said, without mentioning the U.S.

For a Chinese region such as Henan, keeping or growing investment from foreign businesses is a lifeline. Official data showed that in 2019, Foxconn’s iPhone factory accounted for 84% of the entire province’s exports.

China’s Commerce Minister Wang Wentao on Thursday made a relatively rare public acknowledgement of foreign businesses’ longstanding complaints about government procurement policies that favor local Chinese businesses.

Addressing those issues are “priorities for our work,” he said in Mandarin, translated by CNBC. “We will study and introduce policies and measures together with relevant departments to ensure foreign businesses’ equal participation.”

Reports /TrainViral/

Crypto

Bitcoin’s Recovery – the Downturn Is Over

Published

6 months ago

July 16, 2024

The market is currently in a news-driven environment where the prices of cryptocurrencies have been determined by news agenda rather than fundamentals.

Bitfinex analysts have warned crypto investors to be cautious as bitcoin’s (BTC) recovery over the weekend is not a sign that its correction is over; the asset could witness more bloodshed in the near term.

In the latest Bitfinex Alpha report, experts deemed the market’s reaction this week critical, especially as supply alleviated over the weekend could return when traditional markets open.

“No Man’s Land”

Since Saturday, bitcoin has risen almost 10% from $57,600 to $63,000, closing last week in the green. The asset has surged above the 125-day range low of $60,200, which it broke through earlier this month after news of the German government’s massive BTC selling hit the market.

Market sentiment began to improve after reports that wallets linked to the German government were almost empty. However, the positive sentiment may not be sustained for long as the BTC the German authorities moved to trading desks and exchanges are yet to be sold.

While the supply from Germany appears to have been factored into bitcoin’s market price, Bitfinex analysts believe the end of selling pressure depends on how the involved trading desks execute their trades in the coming days.

Although the shift in sentiment underscores the market’s capacity to integrate new information and adjust expectations quickly, analysts think the market’s reaction over the first two trading days of the week cannot be overlooked for two reasons.

First, the low support level in the $60,200 range has now become a potential resistance line. Second, trading patterns over the past three months suggest that weekends are usually favorable for markets, especially on Saturdays when supply pressure seems to subside.

“We are now in no man’s land until we get clear resolution above or below this level,” the analysts said.

A News-Driven Environment

Besides the potential resistance level and three-month weekend trading pattern, the market is currently in a news-driven environment, where the prices of cryptocurrencies have been determined by news agendas rather than fundamentals.

Since selling pressure concerns are not yet completely obsolete due to upcoming Mt Gox creditor distributions, Bitfinex analysts expect such headlines to continue to have some impact on price movements. As such, the analysts urged investors to exercise caution in their trading strategies.

Reports /Trainviral/

Crypto

Bitcoin ETFs Saw $300M in Daily Net Inflows

Published

6 months ago

July 16, 2024

BlackRock’s IBIT led with $117.25 million in inflows on July 15, also being the most traded Bitcoin ETF.

The US spot Bitcoin ETFs recorded a daily net inflow of $301 million on July 15th. This extended their winning streak to seven consecutive days amidst a broader market recovery.

None of the ETFs recorded outflows for the day.

Bitcoin ETFs Rake in $16.11B in Net Inflows Since Jan

According to the data compiled by SoSoValue, BlackRock’s IBIT, the top spot Bitcoin ETF by net asset value, recorded the largest net inflows of the day at $117.25 million. IBIT was also the most actively traded Bitcoin ETF on Monday, with a volume of $1.24 billion. Ark Invest and 21Shares’ ARKB came in close behind with net inflows of $117.19 million.

Fidelity’s FBTC experienced net inflows of $36.15 million on Monday, while Bitwise’s BITB saw $15.24 million in inflows. VanEck’s HODL, Invesco and Galaxy Digital’s BTCO, and Franklin Templeton’s EZBC funds also recorded net inflows. Meanwhile, Grayscale’s GBTC and other ETFs, such as Valkyrie’s BRRR, WisdomTree’s BTCW, and Hashdex’s DEFI, registered no flows for the day.

A total of $2.26 billion was traded on Monday. The trading volume for these ETFs was less than in March when it exceeded $8 billion on some days. Meanwhile, these funds have collectively attracted $16.11 billion in net inflow since their January launch.

What’s Next For Bitcoin?

Earlier this month, bitcoin’s price decline was mainly due to fears of massive selling pressure from Mt. Gox and the German government’s BTC sales.

But the assassination attempt on pro-crypto former US President and presumptive Republican candidate Donald Trump at Saturday’s rally seemed to spark a recovery in the world’s largest digital asset, and experts are bullish on the asset’s price trajectory going forward. Bitcoin surged more than 9% over the past week and was currently trading slightly below $64,000.

Veteran trader Peter Brandt discussed bitcoin’s price outlook, suggesting a potential major rally. He referred to a pattern he terms “Hump->Slump->Bump->Dump->Pump” and highlighted that the July 5 double top attempt was a bear trap, confirmed by the July 13 close. He sees a likely continued upward trend but warned that a close below $56,000 would negate this bullish view.

“Bitcoin $BTC could be unfolding its often-repeated Hump…Slump…Bump…Dump…Pump chart construction. Jul 5 attempt at the double top was a bear trap, confirmed by Jul 13 close. Most likely scenario now is that bears are trapped. Close below $56k negates this interpretation”

Reports /Trainviral/

Crypto

LI.FI DeFi Platform Exploited, Over $8M Lost

Published

6 months ago

July 16, 2024

PeckShield alert reveals LI.FI’s protocol vulnerability is similar to a March 2022 attack, with the same bug recurring.

The decentralized finance (DeFi) platform LI.FI protocol has suffered an exploit amounting to over $8 million.

Cyvers Alerts reported detecting suspicious transactions within the LI.FI cross-chain transaction aggregator.

LI.FI Issues Warning After $8 Million Exploit

LI.FI confirmed the breach in a statement on July 16 via X: “Please do not interact with any http://LI.FI powered applications for now! We’re investigating a potential exploit.” The team clarified that users who did not set infinite approval are not at risk, emphasizing that only those who manually set infinite approvals seem to be affected.

According to Cyvers Alerts, more than $8 million in user funds have been stolen, with the majority being stablecoins. According to on-chain data, the hacker’s wallet holds 1,715 Ether (ETH) valued at $5.8 million and USDC, USDT, and DAI stablecoins.

Cyvers Alerts advised users to revoke relevant authorizations immediately, noting that the attacker is actively converting USDC and USDT into ETH.

Crypto security firm Decurity provided insights into the exploit, stating that it involves the LI.FI bridge. “The root cause is a possibility of an arbitrary call with user-controlled data via depositToGasZipERC20() in GasZipFacet, which was deployed 5 days ago,” Decurity explained on X.

“In general, the risks behind routers, cross-chain swaps, etc. are about token approvals. Raw native assets like (unwrapped) ETH are safe from these kinds of hacks b/c they don’t have approvals as an option. Most users & wallets also no longer do “infinite approvals” which gives a smart contract total control on removing any amount of their tokens. It’s important to understand which tokens you’re approving to which contracts.

This dashboard looks for all transactions of a user that intersects Lifi. Not all of these transactions indicate risk- but you can see how, broadly, integrations & layers of tech (like how Metamask bridge uses Lifi on BSC) can complicate how users do or don’t put their assets at risk. Revoke Cash is the most well known approval manager app.

But it’s also good security practice to simply rotate your address. New addresses start with 0 approvals, so starting fresh by moving your tokens to a fresh address is another good security practice.” – commented Carlos Mercado, Data Scientist at Flipside Crypto.

Recent Exploit Mirrors March 2022 Attack

Further analysis by PeckShield alert revealed that the vulnerability is similar to a previous attack on LI.FI’s protocol that occurred on March 20, 2022. That incident saw a bad actor exploit LI.FI’s smart contract, specifically the swapping feature, before bridging.

The attacker manipulated the system to call token contracts directly within their contract’s context, making users who had given infinite approval vulnerable. This exploit resulted in the theft of approximately 205 ETH from 29 wallets, affecting tokens such as USDC, MATIC, RPL, GNO, USDT, MVI, AUDIO, AAVE, JRT, and DAI.

“The bug is basically the same. Are we learning anything from the past lesson(s)?” PeckShield Alert said in a July 16 X post.

Following the 2022 incident, LI.FI disabled all swap methods in its smart contract and worked on developing a fix to prevent future vulnerabilities. However, the recurrence of a similar exploit raises concerns about the platform’s security measures and whether adequate steps were taken to address the vulnerabilities identified in the previous breach.

LI.FI is a liquidity aggregation protocol that allows users to trade across various blockchains, venues, and bridges.

Reports /Trainviral/