China Cut US Debt Holdings By 9% From The End Of 2021 To July 2022 

According to a report by Nikkei Asia, China has been steadily decreasing its US government debt. Some bonds were also moved to offshore tax havens to protect them from future sanctions.

According to Treasury Department data, Beijing's holdings in US Treasury bonds topped $970 billion in July according to last week's figures. This is an increase of $967.8billion from June 2010, which was the lowest level since May 2010. However, overall the trend has been downward. China's Treasurys have seen a 9% drop in value over the past year, from June to July.

While this was happening, China's Treasury holdings in Bermuda and Cayman Islands jumped by $38.5 million and $7 billion, respectively.

They could be moved offshore to protect China's dollar-denominated assets against future sanctions like those that have frozen Russia's foreign currency reserves.

More than $300 billion worth of Russian assets were frozen in sanctioning countries after Russia invaded Ukraine in the early part of this year.

Nikkei was told by a Chinese government source that Russia's assets were being frozen. This is in addition to Moscow being kicked out of SWIFT's global payments system. Any attempt to unify Taiwan and mainland China with force could result in similar sanctions, which would expose Beijing's $3 trillion foreign-currency reserves.

Nikkei reports that while Treasury holdings are falling, China's gold imports have more than doubled from August last year to $10.36 Billion.