#GateNovTransparencyReportReleased

#DecemberMarketOutlook
ℹ️The People's Bank of China (PBOC), at its Party Committee meeting, reaffirmed its course on:

1. Moderately easing monetary policy: readiness to use reserve requirement ratio cuts and interest rate adjustments to maintain liquidity, stimulate growth, and manage inflation.
2. Internationalization of the yuan: actively developing the cross-border payment system in yuan and the sustainable development of digital yuan (e-CNY) within the framework of increasing financial sector openness.

ℹ️Analysis of the impact on the crypto market:

1. Direct impact: creating a macroeconomic background

· Increasing global liquidity: The PBOC's easing policy adds liquidity to one of the world's largest economies. Part of these funds, as historically occurred, may indirectly (through various channels) seek higher yields in global markets, including crypto assets as a class of risk assets. This is an indirect positive factor for market capitalization growth.
· Inflation expectations: The explicit goal—"reasonable price increases"—signals tolerable moderate inflation. In the long term, this reinforces the narrative of crypto assets (especially Bitcoin) as a hedge against inflation and fiat currency devaluation, although the direct correlation is complex.

2. Key focus: digital yuan (e-CNY) and internationalization

· Competition or adaptation? The sustainable development of e-CNY does not directly support decentralized cryptocurrencies. It enhances a sovereign digital asset (CBDC). This:
· Acts as a competitor to stablecoins and payment cryptocurrencies in the digital payments segment.
· Drives technological adaptation: mass adoption of e-CNY will accelerate familiarity among the public and businesses with digital wallets and blockchain-like technologies, potentially lowering barriers for subsequent adoption of other digital assets.
· Control tool: CBDC provides the government with an unprecedented instrument to control monetary flow, contrasting with the philosophy of decentralized cryptocurrencies.
· Yuan internationalization: Creating a multi-channel cross-border payment system in yuan challenges the dominance of the dollar and systems like SWIFT. If successful, this could reshape the global currency architecture and create new corridors for digital assets, primarily for government-issued digital currencies.

3. Regulatory context: "ensuring national financial security"

· All initiatives are under the prism of control and security. The PBOC will strictly separate the development of its digital yuan from "speculative" decentralized cryptocurrencies.
· This means that within China, a strict ban on trading and mining cryptocurrencies (except for NFTs and blockchain services in approved zones) is likely to persist. China will promote its digital currency while restricting competitors.

ℹ️Summary conclusions:

1. Macro-effect is positive: Additional liquidity and inflationary policies of major central banks (including the Fed, ECB, and now PBOC) create a favorable environment for hard assets with limited issuance, such as Bitcoin, in the long run.
2. Development of e-CNY is a double-edged sword for the crypto market:
· Short-term: Strengthening the state-controlled digital competitor, maintaining strict regulation in China.
· Long-term: Legitimizing digital assets as a class, technological education, and potentially creating new infrastructural bridges between traditional finance (in yuan) and the decentralized world.
3. Main signal: The world is moving towards digitization of money. China is betting on a centralized, state-controlled model. The crypto market offers an alternative, decentralized model. The PBOC's policy confirms this trend but increases competition between these two paradigms.

What does this mean for investors?
Don’t expect the Chinese market to open immediately. Keep an eye on e-CNY as an indicator of the speed of digitalization and a potential future "gateway," while primarily focusing on global liquidity, which, according to the PBOC’s statement, will remain high. This is the foundation for a long-term bullish trend in the market.