Korean Blockchain Firm Ozys Achieves ISMS Certification for Data Security

Legislation geared towards regulating stablecoins has reached the Legislative Council stage in the Chinese autonomous territory of Hong Kong.  The bill, which extends to a 285 page document, has been formulated following “extensive consultations” with industry stakeholders, according to Eddie Yue, CEO of the Hong Kong Monetary Authority (HKMA).  This latest development moves the Chinese autonomous territory one step closer to having a comprehensive regulatory framework in place for stablecoins. The bill’s arrival at the Legislative Council follows its publication on Dec. 6 in Hong Kong’s Gazette. Subsequently, on Dec. 18, it made its preliminary entry at the Legislative Council by way of a first reading. The legislation will deem a digital asset a stablecoin if it is operated on a distributed ledger, is expressed as a unit of account and maintains an equivalent value relative to another asset that it references. Digital assets issued by governments or central banks will be excluded from that stablecoin definition.Photo by Laurentiu Morariu on UnsplashThree readings requiredBefore the bill can be enacted into law, it is required to go through a series of three readings. Allied to that process is a requirement for a series of debates, with the bill coming under the scrutiny of lawmakers. Depending upon the issues raised, this process may also require the introduction of amendments to the proposed legislation. If passed following the third reading, it will then be forwarded to the autonomous territory’s chief executive, John Lee Ka-chiu, to be signed into law. Once signed into law, stablecoin issuers in Hong Kong will then be required to obtain a license from the city's central bank, HKMA. That licensing process would implicate the HKMA scrutinizing the applicant with an emphasis on the evaluation of the issuer, its resources, the use of reserve assets and the means through which the stablecoin’s value will be rendered stable. Stablecoin optimismThis latest milestone has provoked a cause for optimism among some commentators. Sean Lee, co-founder of Hong Kong-based Web3 firm IDA, told the South China Morning Post (SCMP) that “the applications of stablecoin will be numerous.” Lee outlined that stablecoins can be used for payments, settlements, payrolls and financing, while adding that “new products will spring up, and transactions will be faster, instant, 24/7 – and at a lower cost.” Dominic Maffei, Standard Chartered’s head of digital asset and fintech for Hong Kong, is similarly encouraged. Maffei stated: “As of today, we think that stablecoins are the best available tool for connecting traditional finance and Web3 markets and have proven use cases and business models to support that belief.” Once enacted, the bill is likely to have a significant impact on the stablecoin market in Hong Kong. In Europe, the application of the Markets in Crypto Assets (MiCA) regulation is having such an impact. It has led to a growth in Euro-denominated stablecoin trading while leading U.S. dollar stablecoin Tether (USDT) is being delisted by many platforms due to its non-compliance with these regulations.

Korea ST Exchange has committed to conducting a demonstrative experiment involving security tokens to help advance the domestic agriculture and livestock industry along with six other companies, including Korea Venture Agriculture Association, Maeil Business Agtech Innovation Center, MAM TECH, XR Touch, Jangbogo Asset and Crowdy. Representatives from all seven firms participated in an agreement signing ceremony held at the Maekyung Media Center on Thursday, according to local news site Financial News.Photo by Dan Meyers on Unsplash"Smart farms are an industry in South Korea with great potential for growth that is gaining a  competitive edge in the global market," said Cho Won-dong, CEO of Korea ST Trading. "With this agreement, our council plans to strengthen the smart farm security tokens ecosystem to increase the profits of domestic agricultural producers and strengthen global competitiveness." Fostering agricultural innovationThe experiment aims to promote the innovative trading system of smart farms for the development of the agriculture and livestock industry and discover stable underlying assets that will serve as a bridge for integration with innovative finance such as digital assets and security tokens. With this agreement, the parties will cooperate on issuing and distributing tokenized real assets, commodity tokens and security tokens, building infrastructure to support and encourage the trading of security tokens, exchanging information and sharing collaborative networks to build each participating firm’s business. They also plan to issue security tokens in the form of investment contract securities that attribute profits and losses according to the results of joint business ventures by creating a device to tokenize contracts for harvesting agricultural products. Korea ST Trading’s comprehensive roleBased on the platform, Korea ST Trading will provide support for all services such as security token distribution, trading, management, dividends, liquidation and investment information to help expand the smart farm ecosystem and attract private investments.

With local regulator the Securities and Futures Commission (SFC) having set out guidelines for crypto firms regarding the provision of crypto staking services, two prominent Hong Kong companies have moved forward with staking-related offerings. HashKey Capital, a crypto-focused institutional asset manager, and crypto trading platform OSL, have announced the addition of staking to an Ether exchange-traded fund (ETF) and in the case of OSL, a partnership with Kiln to offer ETH staking.Photo by Raymond Yeung on UnsplashFirst spot crypto ETF in APAC to support stakingIn a press release published on April 11, HashKey Capital outlined that its Bosera HashKey Ether ETF, which was jointly launched with Bosera Asset Management in April 2024, has received approval from the SFC to engage in Ethereum staking activity from April 25 onwards.  HashKey claimed that its ETH ETF product is the first spot crypto ETF within the Asia-Pacific (APAC) region to support staking. The company stated: “By enabling staking, the ETF aims to enhance potential returns for investors, creating a new avenue to participate in the Ethereum ecosystem through a regulated virtual asset investment vehicle.” The staking service will be extended to the ETF by another HashKey Group company, HashKey Cloud, a Web3 infrastructure provider. HashKey Capital and HashKey OTC Global CEO Deng Chao said that the institutional-grade staking infrastructure of HashKey Cloud was being leveraged in order to provide a secure, efficient and regulated vehicle to access staking rewards with ease to both professional and retail investors.  The ETF is listed on the Hong Kong Stock Exchange (HKEX). It tracks the price of Ether via the CME CF Ether-Dollar Reference Rate, a daily benchmark index price that aggregates Ether trade data from various sources. Competitive edgeBoth HashKey and the Hong Kong authorities have stolen a march on their international counterparts with the launch. In recent months, efforts have been building in the United States by spot ETH ETF providers to add a staking element to these offerings.Robert Mitchnick, head of digital assets at the world’s largest asset manager, BlackRock, told last month’s Digital Asset Summit in New York that the lack of availability of a staking yield as part of U.S. spot ETH ETFs is likely to be holding the development of the products back. He added:”A staking yield is a meaningful part of how you can generate investment return in this space, and all the [ether] ETFs at launch did not have staking.” HashKey and OSL were the first two entities to be issued trading licenses by the regulator in Hong Kong. OSL is also looking to take advantage of the new regulatory clarity related to crypto staking in Hong Kong. On April 10, it published a press release, outlining details of a partnership that it has formed with enterprise-grade staking infrastructure firm, Kiln. By integrating with Kiln’s API infrastructure, OSL is now enabled in offering clients of its custody platform access to staking services.Kiln co-founder and CEO Laszlo Szabo underscored the significance of regulatory approval of staking in Hong Kong, while stating:”With the future integration of staking, these products will offer investors both exposure to ETH price movements and rewards for securing the Ethereum network.”