Chinese tycoon’s HK ‘stablecoin’ sign of new crypto dawn?
Bitcoin billionaire Li Xiaolai is behind a 'stablecoin' crypto launch that will include platforms for yen, HK and Australian dollars but not RMB
Chinese Bitcoin mogul Li Xiaolai is reportedly leading a stablecoin project in Hong Kong with blockchain fund Grandshores Technology.
Grandshores says that Li – who in 2013 founded BitFund that is, perhaps, the most influential cryptocurrency venture capital fund in China – is now aiming to channel his crypto talents, and finances, towards so-called stablecoins. According to the Grandshores’ Stock Exchange of Hong Kong release, he has also been appointed executive director and co-chief executive officer of Grandshores, a Singapore based “construction and blockchain development” company.
Li, who reportedly is worth over $US1 billion, aims to further expand his crypto reach through stablecoins, which are digital currencies pegged to a particular traditional fiat currency and with reserve backups in that same currency.
The largest one at the moment is Tether, or USDT, which is pegged to the US dollar, or at least it is supposed to be. With multiple ongoing concerns over audits and reserves, Tether has fallen out of favor with crypto traders and as a result has dropped its 1-to-1 US dollar peg and fell as low as $0.95 recently. This has paved the way for a slew of new stablecoins that include USD Coin from Circle and Coinbase and GUSD from the Winkelvoss brothers’ Gemini exchange.
Li’s stablecoin platform will be pegged to the Japanese yen, Hong Kong dollar and Australian dollar and, according to Cointelegraph, Grandshores Technology is planning to offer investments through Tether and also to have the Yen stablecoin ready for launch in early 2019.
In September this year the fund revealed its plans to raise $12.7 million to finance a number of new stablecoins. The decision not to include a Chinese yuan backed stablecoin will have been a strategic one since China still holds a great deal of disdain for all things crypto.
In addition to the stablecoin project, Li is said to be responsible for various other Grandshores projects including the establishment of a public database based on complex DAG (Directed Acyclic Graph) and TEE (Trusted Execution Environment) technologies, as well as other projects relating to blockchain technology applications.
It was only in May of this year that Grandshores Technology announced that it had decided to expand into the blockchain business. Touting its electrical engineering capabilities, including the construction of data centers, it indicated that it was ideally suited to move into cryptocurrency mining. In recent weeks mining profitability has dropped to levels that may mean it is no longer sustainable as Bitcoin’s price has floundered. Where Li Xiaolai takes Greenshores next will be revealing.