Deport Those Chinese Operatives Now!

By: Denise Simon | Founders Code

Have you read the newly released book titled ‘Bully of Asia’ by Steven W. Mosher? China is the single largest threat to global stability and Russia and Iran are in second and third place.

Have you heard of the Thucydides Trap? China is an ascending power and just who is paying attention? Have you studied the fact that China is a major enabler of North Korea’s aggressive behavior including the most recent launch of the intercontinental ballistic missile?

China is a thief. China has dispatched operatives throughout the West under the guise of cultural exchanges, students, temporary workers and journalists. It is all about espionage and cyberwar.

Hey State Department and DHS, get these operatives outta here! By the way, are there any sanctions on China with regard to PLA Unit 61398?

Have you wondered what happened to that Obama Asia Pivot that he announced in 2011? The United States needs to pivot again and now.


This Beijing-Linked Billionaire Is Funding Policy Research at Washington’s Most Influential Institutions

The Chinese Communist Party is quietly reshaping public opinion and policy abroad.

FP: The Johns Hopkins University’s School of Advanced International Studies (SAIS), located just a short walk from Dupont Circle in Washington, D.C., is one of the top international relations schools in the United States. Its graduates feed into a variety of government agencies, from the State Department to the CIA, and the military. Its China studies program is especially well known; many graduates come away with expert knowledge of the language, culture, and politics of the United States’ most important strategic competitor.

In August, SAIS announced a new endowed professorship in the China Studies department as well as a new research project called the Pacific Community Initiative, which aims to examine “what China’s broader role in Asia and the world means for its neighbors and partners.”

What the SAIS press release did not say is that the money for the new initiatives came in part from the China-United States Exchange Foundation (CUSEF), a Hong Kong-based nonprofit. CUSEF is a registered foreign agent bankrolled by a high-ranking Chinese government official with close ties to a sprawling Chinese Communist Party apparatus that handles influence operations abroad, known as the “united front.”

The China-U.S. Exchange Foundation’s partnership with a premier U.S. academic institution comes amid a Chinese Communist Party push to strengthen its influence over policy debate around the globe. The Chinese government has sought to repress ideas it doesn’t like and to amplify those it does, and its efforts have met with growing success.

Even as Washington is embroiled in a debate over Russian influence in U.S. elections, it’s China that has proved adept at inserting itself in American politics.

“The Chinese approach to influence operation is a bit different than the Russian one,” said Peter Mattis, a fellow at the Jamestown Foundation. “The Russian one is much more about an operational objective and they work backward from that objective, saying, ‘How do we achieve that?’” But on the Chinese side, Mattis said, “they focus on relationships — and not on the relationships having specific takeaway value, but that someday, some way, those relationships might become valuable.”

The Chinese seek a kind of “ecological change,” he explained. “If they cultivate enough people in the right places, they start to change the debate without having to directly inject their own voice.”

The China-U.S. Exchange Foundation was founded in 2008 by Tung Chee-hwa, a Hong Kong shipping magnate who later served as the chief executive of the former British colony, where he championed the benefits of close ties to Beijing. Tung’s Hong Kong-based nonprofit conducts academic and professional exchanges, bringing U.S. journalists, scholars, and political and military leaders to mainland China. It also has funded research projects at numerous U.S. institutions, including the Brookings Institution, the Center for Strategic and International Studies, the Atlantic Council, the Center for American Progress, the East-West Institute, the Carter Center, and the Carnegie Endowment for Peace.

Tung’s foundation’s ties to the united front are indirect, but important. Tung currently serves as the vice chairman of one of the united front’s most important entities — the so-called Chinese People’s Political Consultative Conference, which is one of China’s two rubber-stamp assemblies.

The body is one of Beijing’s most crucial tentacles for extending influence.

In its newest project with SAIS, the foundation describes the Pacific Community Initiative as a “joint research project.” David Lampton, director of the university’s China Studies Program, said in an August press release that the new professor “will also be responsible for running our Pacific Community Initiative and work closely with the China-U.S. Exchange Foundation in Hong Kong.”

Lampton also confirmed that CUSEF funded the new programs. “Both the Initiative and the Professorship were made possible through the support of the China-U.S. Exchange Foundation,” he said in an emailed statement to Foreign Policy.

But he denied that CUSEF had attached any intellectual strings to its funding.

“There are absolutely no conditions or limitations imposed upon the Pacific Community Initiative or our faculty members by reason of a gift or otherwise,” Lampton told FP. “We have full confidence in the academic integrity and independence of these endeavors.”

CUSEF denies it acts as a vehicle for Beijing’s ideological agenda or has “any connections” to the united front. “We do not aim to promote or support the policies of any one government,” wrote a spokesperson for the foundation in an email.

This isn’t the first time SAIS and the foundation have worked together; they co-sponsored a conference on China’s economy in Hong Kong in March 2016, according to the school’s website. But a professorship and a major research project offer an opportunity for broader reach — the kind of global influence that Chinese President Xi Jinping has made a centerpiece of his policies. In October, at the meeting of the Communist Party that sets the national agenda for the next five years, Xi called for an expansion of the party’s overseas influence work, referring to the united front as a “magic weapon” of party power.

That quest to shape the global view of China isn’t the same thing as soft power, said James Leibold, a professor at La Trobe University in Melbourne who researches Chinese influence in Australia, where Beijing’s recent influence operations have sparked a national controversy.

China is an authoritarian state where the Communist Party rules with an iron fist, Leibold said — and that is what Beijing is trying to export.

“What we’re talking about here is not Chinese influence per se, but the influence of the Chinese Communist Party.”

In a joint project like the one at SAIS, that influence can be subtle rather than being heavy-handed, said Jamestown’s Mattis. “It’s the ability to privilege certain views over others, to create a platform for someone to speak,” he said. “When you have a role in selecting the platform and generating what I presume they hope are some of the bigger reports on U.S.-China relations in the next few years, that’s important.”

One goal of the joint research project is, in fact, to “yield a white paper to be submitted for endorsement by both the U.S. and Chinese governments,” a CUSEF spokesperson wrote in an emailed statement to FP.

While CUSEF representatives stress that it is not an agent of the Chinese Communist Party, the foundation has cooperated on projects with the the People’s Liberation Army and uses the same Washington public relations firm that the Chinese Embassy does.

One of those PLA projects is the Sanya Initiative, an exchange program that brings together U.S. and Chinese former high-ranking military leaders. On the Chinese side, the Sanya Initiative is led by a bureau of the PLA that engages in political warfare and influence operations, according to Mark Stokes, executive director of the Project 2049 Institute.

Sometimes the results of such high-level exchanges aren’t subtle. In February 2008, PLA participants in the Sanya Initiative asked their U.S. counterparts to persuade the Pentagon to delay publishing a forthcoming report about China’s military buildup, according to a segment excised from the 2011 annual report of the congressional U.S.-China Economic and Security Review Commission.

The U.S. members complied, though their request was not successful.

Exchanges and partnerships are not CUSEF’s only initiatives. As a registered foreign agent, in 2016 it spent just under $668,000 on lobbying, hiring the Podesta Group and other firms to lobby Congress on the topic of “China-U.S. relations.” The foundation has spent $510,000 on lobbying to date in 2017.

CUSEF also keeps on retainer the consulting and public relations firm BLJ Worldwide LTD, the same firm the Chinese Embassy in the United States uses. According to FARA filings, CUSEF currently pays the firm $29,700 a month to promote the foundation’s work and run a pro-Beijing website called China US Focus.

Whether through websites, partnerships, or endowments, China has learned to wrap its message in a palatable wrapper of U.S. academics and intellectuals, according to Mattis.

“Who better to influence Americans than other Americans?” he said.


Meet The World’s Most Powerful Bitcoin Backers

Cryptocurrency may be one of the biggest threats to governments, security and the entire financial system that we’ve ever seen. It can help fund terrorism and its anonymity makes it almost impossible to track. Most importantly, it is poised to revolutionize global finance and banking.

But our new Enemy No. 1 can’t be fought; it can perhaps be controlled. Banks have figured that out and are bringing crypto currency into the fold.

The superpowers—U.S., China and Russia–will have to face the new reality. They love to hate it and hate to love it. Regardless, if they don’t embrace it, they won’t be able to control it. An enemy you don’t control is a much bigger threat.

So, welcome to the new balance of power, funded by cryptocurrency.

“This will ‘uberize’ banking to the extent that the major banks are spending billions to get into this Blockchain, says Frank Holmes, legendary gold investor, CEO of US Global Investors and Chairman of HIVE Blockchain Technologies (TSX:HIVE.V), the first public company where investors can participate in the build-up and infrastructure of crypto-mining.

“Bitcoin is the catalyst for crypto-mining the way emails were for the Internet. When we first heard about the Internet it was for the ‘dark world’, but with email, it exploded and became mainstream. Ethereum takes crypto-mining further with smart contracts,” Holmes told Oilprice.com

The Period of Uncertainty is Over

Russia is embracing it, with an eye to dominating it. China has banned it. The U.S. is struggling to figure out how to regulate it. But nothing can hold it back.

And now, many believe the uncertainty is over.

China tried to ban it in September, making it illegal for residents to trade in cryptocurrencies or start-ups to raise funds through ICOs, completely shutting down local cryptocurrency exchanges.

Bitcoin’s price plunged 40 percent. Then it recovered almost immediately.

This was a reminder that cryptocurrency is an autonomous system that can’t be knocked out.

“The ethos behind blockchain has been tested,” Ken Sangha, COO of Open Money and the Open Project in San Francisco, told Forbes. “A central, organized and powerful authority — China — said ‘no’ and we all have been tested worldwide because of it. But the system flexed its muscles. It’s doing what it was supposed to do.”

And its muscles are the envy of tangible currencies everywhere. Bitcoin hit a record $6,000 per coin on 21 October. Naysayers came out of the woodwork to say it couldn’t possibly last, and definitely couldn’t go any higher. Wrong again. By the last week of November it was approaching $10,000 a coin.

Threats and Opportunities

The potential security threats are clear and present, but let’s put things like new avenues of terrorism funding into perspective.

At this point, terrorist groups are certainly eyeing their options with cryptocurrency, and testing the waters. In January, we saw what appears to be the first case, with the Indonesian government claiming that members of the Islamic State were transferring Bitcoin to each other.

Terrorists could create a virtual currency that is even more powerful and untraceable-one that can completely bypass the global banking system. It hasn’t happened yet, but the potential is there.

While terrorist groups may be mildly courting cryptocurrency, it’s not widespread. Speaking to Newsweek, the Rand Corp’s Joshua Baron, a cryptographer and mathematician, says he doesn’t really see Bitcoin as the “go-to currency for terrorists”—yet. “It does not offer enough anonymity.”

While terrorism is a threat to the security of all states, another threat to the U.S. is an opportunity for Russia: sanctions busting.

The rise of digital currency means that Russian officials sanctioned by the U.S. and the European Union have a way to send and receive money.

While the U.S. Treasury’s Terrorism and Financial Intelligence unit puts sanctioned individuals on a blacklist that keeps them from doing any business in U.S. dollars, cryptocurrency, which isn’t backed or controlled by any state, makes it possible to bypass the blacklist.

But even this pales in comparison to the bigger story here: Bitcoin and its fellow cryptocurrencies are challenging the foundations of the global banking system.

Disruption of the global banking system at this point is “inevitable”, Bala Venkataraman, global chief technology officer of banking and capital markets for Computer Sciences Corp, whose sister company runs the IT backbone of the National Security Agency (NSA), told Newsweek.

“Cryptocurrencies could become the new driver of international business and financial transactions, and that would be transformative, if not revolutionary,” says Dr. Makarenko, whose consulting firm advises Fortune 500 companies.

But here’s the problem:

“If we don’t truly understand how they are operating, who is controlling them and how to avoid it being used for illicit purposes, it may inadvertently turn out to be one of the most innovative turning points in the underworld, whether it’s organized crime, terrorism financing or corruption.”

The Crypto ‘Embrace’ is All About Control

Just last year, Russia was toying around with throwing Bitcoin owners in prison, characterizing cryptocurrency as an infectious pyramid scheme.

Now, Vladimir Putin’s Russia is ready to embrace cryptocurrency—if only to control it.

The real push started in July, when a Putin aide unveiled his cryptocurrency mine: an industrial-scale server farm called Russian Miner Coin. In September, the company held an initial coin offering (ICO), raising over $43 million in Bitcoin and Ethereum.

Then came the regulatory push. After all, Russia has lost an estimated $310 million this year alone due to lack of ICO regulation.

In late October, Putin issued five presidential orders for controlling cryptocurrency. This means everything from taxing coin miners and regulating initial coin offerings (ICOs) to creating legislation for new blockchain tech and setting up a single payment space, presumably with the Central Bank.

Still, the Russian government is not entirely unified on the issue. The Central Bank thinks blockchain is cool, but isn’t keen on cryptocurrency itself. They’d like to have something like a crypto-ruble that could track transactions from cryptocurrencies into rubles.

It’s far more than a fad. Cryptocurrencies are becoming increasingly visible across Russia. Mining is becoming so pervasive, in fact, that computer stores are having a hard time keeping graphic and video cards in supply.

The Russian Finance Minister, Anton Siluanov, has even gone as far as to say that cryptocurrency will soon be treated like regular financial securities.

There’s no point in prohibiting this reality, says Siluanov.

The U.S. might be of the same mind—broadly speaking, but it’s moving at a slower pace in the race to control the world’s new currency.

And it’s its own worst enemy in this scenario, says Dr. Tamara Makarenko, managing director of West Sands Advisory, a UK-based global consulting firm.

But Russia, for one, is much more motivated. Cryptocurrency is a great way to skirt sanctions.

“The U.S. is rightfully concerned about cryptocurrencies, but like anything that may have a negative impact on national security, there are way too many stakeholders that need to be brought to the table to discuss, so the U.S. is not capable of acting quickly,” Dr. Makarenko told Oilprice.com.

“The right conversations are taking place, but at the end of the day, it is in the U.S. interest to secure the value of the global position of the dollar.”

So, while China is banning cryptocurrency and the U.S. is still trying to figure things out, Russia seeks to dominate.

But just like China’s ban will be largely ineffective, so too will Russia’s move to dominate. Cryptocurrency is stateless, and that is its real power. It can be regulated, but not enslaved.

Resilience Proven, Investors Flock to the Future

Right now, about 85 percent of the world’s bitcoin trading volume comes from China. Countries with heavily subsidized energy are obvious ether mining haunts, but now the colder countries have something to offer that has nothing to do with the government, and doesn’t involve any legal gray areas that will come under scrutiny.

With even Putin’s IT advisor getting into the great game, hoping to challenge China’s hegemony in Bitcoin mining, the race is on in full force. They’re hoping to capture 30 percent of the global cryptocurrency mining share in the future.

Japanese billionaire Masatoshi Kumagai, co-founder of giant GMO Internet, announced plans recently to invest over $90 million in a new Bitcoin mining business that will operate as a fund, partially by soliciting capital from investors and repaying them in cryptocurrency.

In North America, billionaire backing is going into HIVE (TSVX:HIVE.V), via Lionsgate Entertainment and Goldcorp (NYSE:GG) superstar Frank Giustra, a legendary mining figure known for being in the right place at the right time—and always in front of a trend.

The new Great Game is virtual reality, and while governments are busy trying to figure out how they can control it, investors are busy sinking billions into what is fast becoming a story of industrial-scale cryptocurrency mining.

Now that everyone’s seen how resilient Bitcoin is, not only are things moving to the industrial phase, but everyone’s weighing the best venues for mining. Because even though this is virtual reality, location still matters.

That’s why HIVE has set up in Iceland, where Mother Nature’s natural cooling is friendly to these massive computing facilities, and where the massive energy required to mine cryptocurrency—in this case Ether–on an industrial scale is cheaper thanks to plentiful hydroelectric and geothermal sources. First, HIVE put $9 million into Hong Kong-based Genesis Mining Ltd., which just built the biggest ether-mining facility in the world—Enigma. Genesis acquired 30% of HIVE in the deal. A second deal in mid-October saw HIVE close a $30-million bought deal financing, completing a $7-million investment by Genesis Mining, acquiring a second data center in Iceland.

And now HIVE is setting up in another ‘cold country’—Sweden—with Genesis.

From China and Russia to North America, virtual is the reality. It’s no longer a question of whether cryptocurrency will survive. It’s a question of what it will disrupt on its way to the top of the global finance chain.

Link to original article: https://oilprice.com/Geopolitics/International/Meet-The-Worlds-Most-Powerful-Bitcoin-Backers.html