Flybit’s Bug Bounty Program to Strengthen Its Crypto Exchange Security

Venture Smart Financial Holdings Ltd. (VSFG), a Hong Kong-based financial services firm, is strategically positioning itself to enter the growing cryptocurrency exchange-traded fund (ETF) market, with its latest reveal being an interest in launching a spot ETH ETF in Q2.Photo by Michael Förtsch on UnsplashIn a recent interview with The Block, VSFG Chairman Lawrence Chu revealed the company's plans to apply for a spot ether ETF in Hong Kong. Executing on that plan is contingent upon the successful launch and approval of its spot bitcoin ETF. Q1 launch for bitcoin ETFLast month, the firm disclosed that it is gearing up for a spot bitcoin ETF launch within the first quarter of this year. VSFG was the first to reveal such an intention within the ETF space in Hong Kong. However, competition is already starting to bubble, as subsequently, Chinese asset manager Harvest Fund announced that it has gone one better and actually filed an application for a spot bitcoin ETF product in the Chinese autonomous territory. Chu shared insights into the firm's current status, mentioning that VSFG is in the final phase of preparing its application for a spot bitcoin ETF to be submitted to the Hong Kong Securities and Futures Commission. He emphasized the rigorous regulatory discussions that precede such submissions in Hong Kong, characterizing the imminent application as being in the advanced stages, stating, “Submission [for application] is almost like when you're 95% there.” Chu acknowledged the importance of ongoing conversations with regulators, expressing readiness by stating, “but that really depends on the conversation we have with the regulator. We will be ready.” Competitive spotlight on ETF feesHighlighting the evolving landscape in Hong Kong, Chu noted that nearly 10 fund companies are exploring the launch of potential spot crypto ETFs in the city. That call echoes similar comments made recently by Livio Weng, CEO of digital assets firm HashKey. The prospect of a potential fee war among asset managers was also discussed, drawing parallels with developments observed in the U.S. bitcoin ETF market. That seems likely, given that downward pressure on spot bitcoin ETF fees in the United States has also spread to Europe where Invesco and WisdomTree have cut fees by 60% on similar products. Global ether ETPsWhile commentators such as Standard Chartered Bank speculate on the likely approval of spot ether ETF products in the U.S. by May and VSFG indicates a potential Q2 launch in Hong Kong, there are already a number of similar products out in the wild around the world. According to data compiled by crypto data aggregator platform CoinGecko, the top 10 ether funds account for $5.5 billion in value. Among them is the XBT Provider ether exchange-traded product (ETP), the world’s first Ethereum-based security made available on a regulated exchange, namely Nasdaq Stockholm in Sweden, by crypto ETP specialist CoinShares. While the race is on in Hong Kong to launch crypto ETFs, on an international basis, competition is heating up as various global fintech hubs look to kindle what is likely to make up a significant part of the ETF sector pie in the years to come.

Japanese blockchain infrastructure firm Soramitsu has been contracted by the State Bank of Pakistan (SBP) to work on a pilot program for the digital Pakistani rupee. Pakistan originally announced its intention to pursue a central bank digital currency (CBDC) or digital rupee back in 2019. However, unlike other Asian nations such as China, Cambodia and Thailand, it has not taken much action to progress such a digital currency since then.SBP Governor Jameel Ahmad spoke at the Reuters NEXT Asia Summit in Singapore last month, outlining that the South Asian country was moving towards the establishment of a digital rupee and “building up [its] capacity” to launch it, and that a pilot project would be the next step. According to a report published by Nikkei Asia on Aug. 12, that pilot project is now underway.Photo by Hamid Roshaan on UnsplashCBDC specialistSoramitsu already has a wealth of experience in this field. In 2023, it signed a memorandum of understanding with the Laotian central bank to launch a proof-of-concept CBDC project, with the Tokyo-headquartered company going on to play a pivotal role in the issuance of Laos’ Digital Lao Kip.In Cambodia, it partnered with the National Bank of Cambodia to bring about the establishment of Bakong, Cambodia’s CBDC-like payment system. The company is also involved in CBDC projects in Papua New Guinea and the Solomon Islands, while spearheading a project aimed at enabling seamless cross-border payments among Asian countries. Japanese fundingIn the case of Pakistan’s pilot project, Soramitsu’s CBDC platform will facilitate the digital rupee while funding is being provided by the Global South Future-Oriented Co-Creation Project, an initiative from Japan’s Ministry of Economy that seeks to promote the formation of co-creation business models. Infrastructure, such as the internet and power, can be unstable in some parts of Pakistan. Consequently, the proposed CBDC will incorporate the ability for the user to transact with it using their smartphone, even if the phone doesn’t have an active internet connection. Digital transformationMasato Toriya, an associate professor at Tokyo University of Foreign Studies and an expert on Pakistan, outlined the behavioral change that would be required in getting Pakistanis in rural areas to use such a currency. He stated: “Many transactions in rural areas are cash-based, even for wage payments, and the rate of people with bank accounts is low."  However, cash-based systems have significant overheads, and it's thought that a CBDC could reduce such costs considerably. Last month, the Pakistan Institute of Development Economics published an article written by Dr. Ahmed Fraz, an assistant professor of finance with the organization, in which he claimed that the digital rupee pilot project is part of a “profound digital transformation” that Pakistan is moving towards.  Dr. Fraz asserted that a CBDC would enhance financial inclusion in Pakistan through the reduction of transaction fees, digitization of welfare payments and the financial inclusion of millions of unbanked citizens within the formal economy.He added that the digital rupee “is not intended to replace existing payment systems immediately but to complement platforms” and to modernize Pakistan’s financial architecture.

Japan’s HashPort Group Raises $8.5M in Funding RoundHashPort, a leading blockchain developer based in Japan, has successfully raised 1.2 billion Japanese yen (approximately $8.5 million) in a Series C funding round.The funding was secured through key investors, including Sumitomo Mitsui Banking Corporation (SMBC), The University of Tokyo, Edge Capital Partners, and Japanese billionaire entrepreneur Yusaku Maezawa. With this latest infusion of capital, HashPort’s total funding has now reached an impressive 2 billion yen (about $14.2 million).Global expansion plansThe announcement, which was made on Friday, revealed that these fresh funds will be instrumental in driving HashPort’s global expansion plans, particularly in the face of complex regulatory environments. The company aims to fortify its business operations and establish a robust compliance management system, essential for navigating the intricate web of global regulations.At the core of HashPort’s ecosystem are two significant components. The first is its namesake blockchain-related consulting and system solution, which has gained substantial recognition in Japan. The second is HashPalette, a public chain specially designed for non-fungible tokens (NFTs), tapping into the booming NFT market. Additionally, HashPort is set to unveil an exciting metaverse game called The Land Elf Crossing in the upcoming fourth quarter.Coincheck collaborationHashPort’s previous collaboration with Japanese cryptocurrency exchange Coincheck garnered considerable attention. Together, they launched Japan’s first initial exchange offering (IEO), which raised an impressive 22.45 billion yen (approximately $160 million) in commitments for the Palette (PLT) token. As a testament to the success of this venture, PLT Place, the official NFT marketplace of Palette Chain, now boasts over 370,000 users.President Seihaku Yoshida expressed HashPort’s future ambitions, revealing plans to cooperate with Expo 2025, a highly anticipated event scheduled to take place in Osaka. HashPort aims to develop digital wallets and digital passports linked to soulbound tokens (SBTs) for Expo 2025. With an estimated 28 million visitors expected to attend the expo, the company sees this as a historic opportunity to introduce Web3 technology to a broader audience.Soulbound tokensIn December 2022, one of HashPort’s current investors, SMBC, joined forces with the company to explore the potential applications of SBTs. Proposed by Ethereum Co-Founder Vitalik Buterin, SBTs represent the characteristics or reputation of individuals or entities, much like the concept of soulbound items in the popular massively multiplayer online role-playing game (MMORPG), World of Warcraft.As part of that collaboration, SMBC and HashPort were discussing the possibility of creating a “safe and secure Web3 economic zone.” No further details were given beyond that, but the idea may have been along the lines of creating something like Cyberport, an innovative digital community which has been created in Hong Kong, featuring over 1,900 start-ups and technology companies.The successful funding round marks a significant milestone for HashPort, providing the necessary financial resources to accelerate its expansion plans and drive innovation in the Web3 space. As the company continues to pioneer advancements in the blockchain and NFT sectors, its collaboration with Expo 2025 and ongoing exploration of SBTs showcase the company’s efforts in attempting to contribute towards shaping the future of decentralized technologies.