2430 Group

China’s Deep-Sea Research Station: A Strategic Shift in Energy and Geopolitics China is expanding its dominance in the South China Sea not just militarily, but through resource control and energy innovation. The latest move is the construction of a deep-sea research station 1.2 miles beneath the contested waters to study and potentially extract methane hydrates, a fossil fuel known as “flammable ice.” This development has major geopolitical and economic implications: - Energy Leadership – If China harnesses methane hydrates, it could reshape global energy markets, reducing dependence on traditional oil and gas. - Maritime Dominance – A permanent facility in a disputed region strengthens China’s territorial control, further challenging U.S. and allied influence. - Strategic Leverage – Control over critical resources enhances China’s bargaining power in trade, defense, and global energy negotiations. For US national security, this move signals a long-term challenge—one that extends beyond military presence to resource control and economic influence. Washington and its allies must assess the strategic, energy, and security risks posed by China’s deep-sea ambitions. ?? Read more: https://lnkd.in/gJnMe6Nv #Geopolitics #NationalSecurity #EnergySecurity #China #SouthChinaSea #GlobalStrategy #MaritimeSecurity #FutureOfEnergy #EconomicInfluence #SupplyChain

Following news of Secretary Hegseth’s order to US Cyber Command to cease offensive operations, and CISA’s alleged de-prioritization of Russian cyber threats, it seems likely that private sector threat intelligence departments may need to do more on their own to protect US digital infrastructure. This conclusion presumes that Russia does not reciprocate the apparent unilateral action of the US. CISA publicly denied any deprioritization. Moreover, sources tell us that companies have not yet felt a pull back in standard intelligence sharing with US government agencies. However, they do note that Russian cyber activity targeting US companies, government networks, and overall infrastructure to this point continues unabated. Major technology firms are taking note of the apparent US policy shift and considering how it could affect their defensive cyber operations. Companies like Google, Microsoft, and Amazon all maintain significant cyber threat intelligence operations tasked with uncovering and degrading offensive cyber operations, often run by state actors like Russia, China, Iran, and North Korea. Many threat intel professionals consider Russia to be the most sophisticated cyber actor in the world. One source expressed concern that if the US will no longer hold Russian digital infrastructure “at risk,” it may allow Russia to dedicate more resources to target US interests domestically and abroad. Russian actors aggressively and routinely mount cyber espionage and ransomware campaigns targeting US assets. The same source also noted that the alleged CISA de-prioritization was of particular concern, because unlike Cyber Command, CISA’s primary role was to advise US companies, organizations, and the public about threats from Russian cyber activity.

2430 Group’s director Glenn Chafetz urges U.S. and allied leaders to recognize that Xi Jinping’s deep insecurity and need for absolute control are accelerating the pressure and timeline for him to use the PLA against Taiwan—and the time to prepare is limited. Xi is confronted with China’s economic/demographic decline and weakening long-term prospects. But with total control over the PLA through personnel purges and ideological indoctrination, military action could serve as a way to legitimize his power and achieve his goals before his position weakens further. For more, please check out Glenn’s article in the RealClearDefense. #China #Taiwan https://lnkd.in/eQXYAc95

?? Check out this week's Red Report! ?? Our bi-weekly spotlight: Capturing significant China-related events and policies with in-depth analysis. This newsletter offers valuable insights that can guide strategic business decisions and keep you informed of evolving geopolitical dynamics. Topics for this week: China's Tech Sector: Xi Jinping is showing renewed interest in the private sector, particularly tech, likely due to economic concerns and recent tech advancements. However, the Chinese Communist Party (CCP) maintains overall control of the economy. US-China Policy: The Trump administration's approach to China is marked by protectionist measures like tariffs and export controls. There's uncertainty about the long-term strategy and who is influencing policy decisions. Global Business Impact: The US-China trade disputes are causing shifts in global alliances. Europe is considering closer ties with China, and US allies like Japan are negatively affected by tariffs from both sides. Tech and Resources: The US and China are in competition over semiconductor technology and rare earth metals. China's control of these resources gives it a strategic advantage. Espionage Concerns: The firing of US intelligence operatives by the Trump administration creates a risk of recruitment by foreign powers, increasing the need for corporations to protect their intellectual property. Understanding these complex issues can help stakeholders mitigate risks and leverage opportunities in a turbulent global market. ?? Subscribe to The Red Report to get our newsletter delivered to your inbox bi-weekly on Mondays: https://lnkd.in/ecHxNGQJ ?? If you would like additional analysis tailored to your specific business or institution, please contact us at [email protected].

After driving China’s economy into a ditch, Xi Jinping has apparently become convinced of the need to bring Alibaba’s Jack Ma back from purgatory and make a show of concern for China’s private sector. While Xi’s February 16 televised remarks to various tech titans was a plea for help, it was also a reminder that Xi is in charge, and that all companies in China, private or state-owned, must toe the party line. ?https://lnkd.in/gFvEiTVk

Check out this week's Red Report! Our bi-weekly spotlight: capturing significant China-related events and policies with in-depth analysis. Topics for this week: -China's Tech Sector: Xi Jinping is showing renewed interest in the private sector, particularly tech, likely due to economic concerns and recent tech advancements. However, the Chinese Communist Party (CCP) maintains overall control of the economy. -US-China Policy: The Trump administration's approach to China is marked by protectionist measures like tariffs and export controls. There's uncertainty about the long-term strategy and who is influencing policy decisions. -Global Business Impact: The US-China trade disputes are causing shifts in global alliances. Europe is considering closer ties with China, and US allies like Japan are negatively affected by tariffs from both sides. -Tech and Resources: The US and China are in competition over semiconductor technology and rare earth metals. China's control of these resources gives it a strategic advantage. -Espionage Concerns: The firing of US intelligence operatives by the Trump administration creates a risk of recruitment by foreign powers, increasing the need for corporations to protect their intellectual property. Subscribe to The Red Report to get our newsletter delivered to your inbox bi-weekly on Mondays: https://lnkd.in/ecHxNGQJ If you would like additional analysis tailored to your specific business or institution, please contact us at [email protected].

New Research: Critical Gaps in US Semiconductor Export Controls 2430 Group's latest report, "Arming Our Adversaries: The Inadequacy of US Chip Controls," reveals concerning findings about US microprocessor transfers abroad. The 2430 Group investigation, supported by ChainSentry data, documents how dual-use semiconductor technology is reaching countries like Iran and Russia through unauthorized channels, subsequently appearing in weapons systems targeting US forces—including those used in the deadly January 2024 Tower 22 attack in Jordan. The report identifies several supply chain vulnerabilities involving gray market brokers, e-commerce platforms, and even US defense contractors. Furthermore, we found that much of this unauthorized trade relies on US-based internet infrastructure. These findings highlight the urgent need for strengthened export controls and supply chain security. The full report is available at: https://lnkd.in/egBHHTt5 #SupplyChainSecurity?#ExportControls?#NationalSecurity?#TechPolicy?#SemiconductorIndustry

China may seem from the outside to be a state-party-economic monolith securely under the control of the Chinese Communist Party (CCP); and moreover, that the CCP is completely under the thumb of the Xi Jinping. But neither Xi nor his colleagues see their positions in that way. Xi and other top CCP leaders fear that their authority is one crisis or mistake from crumbling. This is the lesson they draw from the fall of other authoritarian regimes like Iraq, Libya, and most especially the collapse of Communist rule and the fall of the Soviet Union in 1991. This point of view breeds a paranoid view of both domestic and international politics, where perils are ubiquitous. This is the reason for hypersensitivity to any slights, the reliance on ultranationalism as a means of legitimation and the depiction of the United States as an existential threat. This is also the reason that People’s Liberation Army units must devote between 20 and 40 percent of their time undergoing ideological indoctrination, which also includes glorification of Xi himself. “Political power,” as Mao asserted, “grows out of the barrel of a gun.” Thus, Xi thus spends whatever he thinks necessary to ensure that those who wield the weapons remain loyal to him. The irony is that the devotion of so much time, money, and effort to indoctrination diverts from the effectiveness of the force on which the CCP relies. Moreover, institutional paranoia is intrinsically impervious to cure. Consequently, Xi and the CCP can never obtain the level of security they seek, and can never be satisfied with the level of power they wield. Link: https://lnkd.in/gf7AMiTk

Discover the complex dynamics between #BigData, Beijing, and the TikTok controversy in our latest article on #TikTokDebate #DigitalSovereignty #USChinaRelations #TechPolicy.

This week in The?Red?Report: China Welcomes Trump’s Conflicts with US Allies and Land Grabs Are export controls effective?? Chinese AI software DeepSeek upends AI market How good is Deepseek’s model? If TikTok was bad, Chinese LLMs are potentially far worse Is TikTok close to finding a US buyer? For the full report, link below! https://lnkd.in/g2jn3NkV