Korean Blockchain Experts Suggest Tackling Everyday Challenges with Blockchain Adoption

Bithumb records declining performance in Q3 amid market challenges and interest rate hikesBithumb Korea, the operator of the South Korean cryptocurrency exchange Bithumb, reported an on-year decline in performance compared to last year, driven by deteriorating market conditions. According to data from the Korean Financial Supervisory Service on Tuesday (local time), the exchange recorded a net loss of KRW 10.6 billion (approximately $8.1 million) and operating losses of KRW 650 million in Q3. Its revenue amounted to KRW 32.4 billion, a 53% decrease from the same period last year.Photo by Алекс Арцибашев on UnsplashFalling figuresBithumb had recorded KRW 28.8 billion and KRW 32.6 billion in operating and net profits, respectively, in Q3 last year, but both of these figures turned into a deficit for the same period this year.This worsened performance can be attributed to weakened investor sentiment amid the U.S. Federal Reserve’s ongoing interest rate hikes and a decrease in trading volumes.However, just last month, these conditions have begun drastically improving as excitement mounts for the potential approval of a spot bitcoin exchange-traded fund (ETF).Murky futureNevertheless, concerns about Bithumb’s profitability in Q4 are arising following the exchange’s zero trading fee policy that it implemented last month in a bid to regain its market share, especially because the primary source of revenue for crypto exchanges is trading fees. Bithumb had previously charged trading fees of between 0.04% and 0.25%.“We will do our best to enhance the competitiveness of our services to boost our market share,” Bithumb said. “At the same time, we will enhance the transparency of our operations through efforts such as our recent preparations for an initial public offering (IPO) and improvements in corporate governance.”The exchange’s upcoming IPO is part of efforts to be listed on Korea’s KOSDAQ stock exchange by 2025, which would make it the first virtual asset company to do so. It had previously considered preparing for an IPO in 2020 but suspended plans due to a lack of clear regulations for virtual assets. But with the upcoming Virtual Asset User Protection Bill set to take effect next July, Bithumb decided that the current regulatory landscape would be conducive to an IPO.Should it take effect, this IPO is also expected to pose a challenge to Upbit, which currently holds over 80% of the country’s market share. However, there is still a considerable amount of uncertainty shrouding this development, as financial authorities are maintaining a wary stance towards virtual assets.

Nomura-Backed Digital Exchange Acquires Trading License in DubaiKomainu, a digital exchange backed by Japanese financial services conglomerate Nomura, has achieved the milestone of acquiring an operational license in Dubai.The occasion marks a significant moment for Komainu’s expansion efforts in the Middle East, highlighting the progress the company has made in terms of regulatory approval. It follows Komainu’s previous success in obtaining its MVP license in November 2022, establishing the company as one of the first entities to receive such authorization from the local regulator.The operational license was granted by Dubai’s Virtual Asset Regulatory Authority (VARA) on Friday, with the firm being added to the regulator’s virtual asset service provider register.Photo by Emma Harrisova on UnsplashEnabling a broader service offeringWith this operational license in hand, Komainu is now equipped to introduce extended institutional staking and collateral management services to clients within Dubai. These services will be facilitated through Komainu Connect, a purpose-built platform tailored to cater to the precise needs of institutional clients.While Komainu is a Jersey-based entity, the company has an active presence in the Dubai market as it has established subsidiary firm Komainu MEA FZE, which is based within the city. This local presence indicates Komainu’s intention to play an active role in the institutional digital asset business in the region.Dubai growth potentialSebastian Widmann, Head of Strategy at Komainu, emphasized the exciting growth prospects that Dubai’s flourishing digital asset ecosystem offers. He noted that the region is currently experiencing an influx of assets driven by the launch of new exchanges.Widmann stated: “Dubai has a vibrant digital asset ecosystem and impressive talent pool, and we are proud to contribute to the growth of this innovative financial hub.” He further emphasized that Komainu’s presence and its favorable regulatory status position the company uniquely as it embarks on the next phase of its business journey.It’s been a good month for Nomura-backed digital asset businesses in Dubai. A few weeks ago, another Nomura-funded company, Laser Digital Middle East FZE, was also successful in acquiring an operating license from VARA.VARA’s approach to crafting regulations has been instrumental in fostering a framework that supports permissible activities and services for customers and investors in Dubai. These regulations are designed to enhance clarity, establish certainty, and mitigate potential market risks. VARA’s overarching objective is to create a model framework that promotes both global economic sustainability and innovation.Bridging market gapFounded in 2018, Komainu’s inception was driven by the need to bridge a gap in the market by delivering secure and compliant custody services for institutional players venturing into digital asset investments.Komainu’s foundation is built upon a strategic joint venture involving prominent entities such as Nomura, CoinShares, and Ledger. It acquired its first client for Komainu Connect, the firm’s regulated settlement and custody system for institutions, in June when it signed up Seychelles-based crypto exchange OKX to the service.Headquartered in Jersey, the Jersey Financial Services Commission (JFSC) and Dubai’s Virtual Asset Regulatory Authority (VARA) now provide regulatory governance where Komainu’s activities are concerned.

CoinFLEX founder: creditors not to interfere with OPNXMark Lamb, the co-founder of failed crypto derivatives and yield platform CoinFLEX, has asserted that creditors of the company cannot interfere with OPNX, a Seychelles-incorporated company that Lamb has co-founded with Kyle Davies and Su Zhu, the founders of failed Singaporean crypto hedge fund, Three Arrows Capital (3AC).Photo by Chapman Chow on UnsplashFallout following writIt emerged in October that a group of CoinFLEX creditors had filed a writ of summons in the High Court of Hong Kong, claiming that OPNX, a new crypto bankruptcy claims trading platform linked to CoinFLEX, was established using CoinFLEX assets without their consent. While incorporated in the Seychelles, CoinFLEX ran its operations from Hong Kong.The writ alleges that Mark Lamb misappropriated assets, diverted clients and business opportunities and engaged in actions harmful to creditors during his tenure.The creditors argue that Lamb, while serving as CoinFLEX’s CEO, simultaneously devoted time and effort to setting up OPNX, contrary to his responsibilities. The allegations include diverting assets, falsely representing OPNX’s association with CoinFLEX creditors, disclosing confidential trade secrets and soliciting employees to move to OPNX.The legal action — filed by two companies, Liquidity Technologies and Liquidity Technologies Software — claims that OPNX’s formation was unauthorized and harmful to CoinFLEX creditors. Despite CoinFLEX’s terms of service requiring dispute resolution through arbitration in Hong Kong, the allegations have not been proven in the High Court of Hong Kong.Lamb addresses ‘Twitter FUD’In response to these creditor actions, earlier this week, Lamb took to X (formerly Twitter) to address what he termed as “Twitter FUD.” Lamb wrote:“The Hong Kong court ruled that the few CoinFLEX creditors behind recent ‘FUD’ must not disrupt or interfere with OPNX in any way — and their legal counsel has subsequently stopped representing them.”Lamb added that he hoped that CoinFLEX’s 4,800 creditors would choose the path that he has proposed on the basis that it “maximizes value.”OPNX has defended its position, emphasizing that it provided an opportunity for creditors to sell their claims on the exchange for quick cash, benefiting them. Davies and Zhu have pledged to donate their share of the profit to 3AC creditors.In February, OPNX CEO Leslie Lamb, Mark Lamb’s wife, announced the rebranding of CoinFLEX to Open Exchange (OPNX). However, the writ of summons claims that OPNX is a separate entity not authorized by CoinFLEX creditors. Leslie Lamb followed up in April by claiming backing from well-known entities in crypto venture capital, only for many of those mentioned to immediately refute such claims.The dispute has also implicated Roger Ver, a well-known character in the crypto space otherwise referred to as “Bitcoin Jesus.” Ver, a significant individual customer, was accused of defaulting by CoinFLEX. Ver denied defaulting and claimed that CoinFLEX used his trading positions against him, leading to a court-ordered arbitration.OPNX, since its launch in April, has obtained a Lithuanian license for spot trading in the EU and currently processes substantial daily trading volumes. Criminal and civil proceedings against OPNX co-founders Davies and Zhu are ongoing. The situation remains fluid as the legal dispute unfolds.