September 8, 2015- In This Issue:


Goldman Analyst: Blockchain Tech Will Change Asset Ownership
A Goldman Sachs analyst has revealed further insight into the global investment banking giant's developing thesis on bitcoin and blockchain technology.

In a podcast released this summer and highlighted by a recent New York Times piece, global investment research analyst Heath Terry addressed both bitcoin and the blockchain, praising the distributed ledger as a technology that would have "massive implications" for asset and ownership transfer.

"We're first pitch, first inning in terms of seeing how companies are going to use the technology," Terry said, adding:

"It's fascinating in really early stages, but it's hard to see a world where blockchain technology doesn't change the way we think about asset ownership."

AXA Eyeing Bitcoin for Remittance Market
Multinational insurance and asset management company AXA is eyeing bitcoin to help streamline the remittance market, the general partner of its VC fund has told CoinDesk.

Minh Q Tran said AXA Strategic Ventures, the bank's $223m fund, and its accelerator, AXA Factory, are treating digital currency as an "investment thesis".

He said:

"We think that many use cases related to bitcoin have not already been explored. In particular we are very interested in how bitcoin, and more generally cryptocurrencies, might be used in the remittance market."

Gold And Bitcoin Could be the Beneficiaries of China's Woes
I don't know about you, but I am getting sick of hearing about China. It seems that every time any market moves, stocks, bonds, oil - anything - China is given as the reason. It's beginning to sound more like an excuse than a reason. I mean, does slower than expected Chinese growth justify oil below levels from the depths of the recession? How does lower manufacturing output in China justify a big drop in Lowes Home Improvement stock (LOW), or U.S. utilities?

The one area where the events unfolding in China, however, do have an effect is on Bitcoin, and yet we have heard very little of that from the financial media. In many ways, the type of crisis that China is going through is exactly what Bitcoin was devised to protect against. You have a situation where the normal investments and stores of value for the Chinese people, stocks and gold, are both going through their own recalibration, albeit on different timescales.

Will China Turn To Bitcoin To Avoid New Capital Controls?
China has been facing a massive outflow of money for years and now the time to take serious measures has come. Officially capital controls look as follows in paper - no one is allowed to transfer abroad more than $50,000 per year. Legal entities have to provide weighty purpose to exchange Chinese national currency for foreign ones.

In realty these rules have been violated for years which led China to current economic situation. Massive capital outflow has been evident. Nevertheless no actions have been taken to stop it.

One way of illegal cash transfer is an open secret. Mainland Chinese customers just needed to make a trip to Macau, an autonomous region of China. There many entrepreneurs allowed them to make fake purchases using UnionPay credit cards, thus getting cash and evading strict capital controls.

There is no official information concerning how much money was transferred into Macau. Reuters cites the data of Tam Chi Keong, an assistant professor at the Macau University of Science and Technology, who estimates the total yearly amount as HK$1.57 trillion ($202 billion) flowed out through various channels. Tam says his estimate is based on his analysis of Macau's finances and interviews with gambling industry participants.

It's hard to explain now why even central bank, the Peoples Bank of China, though obviously knew the illegal outflow, didn't act harder to block it. Unfortunately the answer is as evident as it seems - many top politicians used this way themselves to save up hundreds of billions on their offshore bank accounts.