Allowing the opening of crypto markets could, of course, encourage more flows out of the yuan, which the Chinese authorities would understandably prefer to avoid. But if crypto assets and the innovation they bring are going to be key to the development of the financial markets of tomorrow, then China would obviously want some influence. Furthermore, China is probably watching with interest the building antagonism toward crypto from Washington, D.C. If the U.S. sees crypto markets as a threat, it could be a threat worth exploring.
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