Various banks have programs to collateralize chinese assets and offer a loan based on those assets.
eg. You collateralize $10 million in Chinese assets, you get a $8 million dollar loan from a bank branch in another jurisdiction.
Capital controls have already essentially be thwarted by the market, the second item is that BTC actually provides a great public ledger for amounts that would be unfeasible for the usual controls like FINTRAC.
It shouldn't really be called bitcoin so much as bitledger. You also have to consider that factions within the party may think bitcoin will generate more capital inflows rather than capital outflows.
Do loans like that really defeat capital controls? The "owner" of the money has changed, but the location hasn't. The bank giving you the loan is playing a very long game, because they still can't move the collateral out. Right, wrong?
Not really, as soon as the loan is repaid the bank is whole. The loan originates in a non-Chinese country so when the loan is extinguished the bank has the value of the loan plus interest.
Only if the loan defaults does the bank run any risk of having capital trapped in China. Worst comes to worst they use the capital in China to originate more loans in China. Any bank offering this service has a presence in China so it's not a big deal anyway.
It doesn't have to be a long game as long as they can unwind their position over a longer time frame and with less frictional costs than the individual, which wouldn't be surprising for a large institution.
eg. You collateralize $10 million in Chinese assets, you get a $8 million dollar loan from a bank branch in another jurisdiction.
Capital controls have already essentially be thwarted by the market, the second item is that BTC actually provides a great public ledger for amounts that would be unfeasible for the usual controls like FINTRAC.
It shouldn't really be called bitcoin so much as bitledger. You also have to consider that factions within the party may think bitcoin will generate more capital inflows rather than capital outflows.