CoinEx Reveals Insights Into Recent Platform Hack

Hong Kong’s HashKey Adds AVAX TradingHashKey Hong Kong, the Chinese autonomous territory’s first licensed retail crypto exchange, has unveiled an addition to its platform with the launch of Avalanche (AVAX) trading.According to an announcement published to its website on Wednesday, HashKey has listed Avalanche on Thursday with the caveat that access to AVAX trading will be reserved for professional investors, as defined by Hong Kong’s Securities & Futures Commission (SFC).Photo by Wance Paleri on UnsplashAccessible to professional investorsTo meet the criteria as a professional investor in Hong Kong, individuals must possess an investment portfolio valued at a minimum of 8 million Hong Kong dollars, roughly equivalent to $1 million. This decision sets AVAX apart from other widely traded cryptocurrencies, such as Bitcoin and Ether, which remain accessible to retail investors in Hong Kong. While Tether (USDT) enjoys retail status, the majority of altcoins on HashKey will remain the preserve of professional investors.This move is a direct result of the SFC’s proactive stance on regulating the rapidly expanding crypto market in Hong Kong. Since the introduction of regulated retail crypto trading in the Chinese autonomous territory in August, the SFC has imposed rigorous requirements on exchanges. HashKey mandates users to deposit a minimum of 10,000 Hong Kong dollars or $1,500 into their exchange accounts as part of the Know Your Customer (KYC) verification process.Low trading volumeAmid these regulatory challenges, HashKey Hong Kong currently reports a 24-hour trading volume of approximately $5.3 million, significantly lower than its global peers. This lower trading volume suggests that stringent regulations may be affecting the exchange’s ability to attract retail investors effectively.The path to regulatory compliance in Hong Kong has been anything but smooth for crypto exchanges. Reports indicate that these platforms have collectively invested over $25 million in establishing the requisite infrastructure for obtaining a Hong Kong Virtual Asset Service Provider (VASP) license. It was reported earlier this year that crypto firms are forking out between $2.55 million and $25.5 million in order to secure a VASP trading license.Despite the challenges, HashKey is looking at various avenues in bringing its offering forward. Earlier this month the firm signed a memorandum of understanding (MOU) with insurer OneDegree. That collaboration could be significant as it should lead to the assets of HashKey users being protected and insured on the platform. That would solve a major issue for participants in the crypto space amid the backdrop of ongoing platform failures and hacks.JPEX collapseEven as regulatory efforts intensify, the crypto industry in Hong Kong has not been impervious to bad actors. The recent collapse of the JPEX crypto exchange earlier this month serves as a stark reminder of the ongoing risks associated with the industry. Described as the largest financial fraud in Hong Kong’s history, JPEX faced allegations of embezzling over $178 million of investors’ funds. Notably, JPEX was operating without SFC registration at the time of the alleged embezzlement.In response to such incidents, the SFC has taken proactive measures by publishing a warning list of crypto exchanges considered non-compliant within the Chinese autonomous territory.

Bitget Claims Debt-Free Status via Proof of ReservesBitget, the Seychelles-based cryptocurrency derivatives exchange, proudly announced that its total proof-of-reserves ratio has reached an impressive 223% in its latest report.Photo by Traxer on UnsplashReserve of $1.44 billionIn a press release published to its website on Thursday, the exchange revealed that it currently holds a reserve of $1.44 billion, encompassing 31 different crypto assets. The reserve ratios for popular cryptocurrencies such as Bitcoin (BTC), Tether (USDT), Ether, and USDC stand at 454%, 135%, 171%, and a staggering 2,604%, respectively.Bitget executives, in an interview with Cointelegraph, emphasized the exchange’s commitment to operating without relying on debt or user funds for transactions or investments. They stated that the company is debt-free and has no outstanding liabilities, nor is it listed as a creditor for any recently bankrupt companies.When questioned about the high collateralization for certain coins, the exchange clarified that the funds originate from profits generated through transaction fees and returns from investments and acquisitions. While Bitget does not have external insurance for its users, it maintains a robust $300 million User Protection Fund.Executives assert that this fund operates more effectively than third-party insurance, enabling them to efficiently safeguard users’ assets without being dependent on external bureaucracy or policy changes.Partnering with third-party auditorsAlthough not yet a regulatory requirement, Bitget aims to enhance transparency by increasing partnerships with third-party auditors to thoroughly examine its assets and reserves. The exchange diligently updates its proof-of-reserves every month, further reinforcing its commitment to accountability and trustworthiness.While proof-of-reserves has gained popularity as a means of disclosing information about exchange assets, experts have cautioned about its effectiveness. Jack Graves, a professor of law at Syracuse University, highlights the challenges in determining the portion of assets pledged as collateral unless one has access to an exchange’s financial services, books, and records.Bitget’s remarkable proof-of-reserves ratio and its commitment to being debt-free demonstrate a greater focus on behalf of cryptocurrency exchanges in providing the crypto trading public with an enhanced level of information relative to the real-time financial position of the exchange.Crypto loansThe move is significant and much needed, following a dreadful 2022 for crypto consumers that saw many of them lose funds due to a complete lack of transparency with regard to funds held on deposit on behalf of customers. That period saw the collapse of platforms such as Celsius, FTX, Voyager, BlockFi, and others as a direct consequence of the mismanagement of user funds.It’s interesting too, that most of the platform failures involved crypto lenders, a space that Bitget recently announced that it was entering. Earlier this month, the company outlined that it would begin to offer crypto lending products to meet a need from users who are seeking alternative funding solutions, backed by digital assets.By diligently managing its funds and actively seeking audits, Bitget is making an effort to foster trust within the cryptocurrency community and ensure the safety of users’ assets.

Hong Kong–listed companies are stepping up digital-asset bets as the city sets out a clearer rulebook, a sign that tighter oversight and new market rails are starting to unlock institutional demand.Photo by Ruslan Bardash on UnsplashCorporate moves signal rising appetiteBoyaa Interactive International has been adding Bitcoin (BTC) to its treasury, with the latest acquisition of 411 BTC bringing its total holdings to 4,091 BTC. The gaming company has said it will direct 90% of a planned $56.3 million rights issue into Bitcoin. Yunfeng Financial raised HKD 1.17 billion, or about $150 million, through a new share issuance and plans to use part of the proceeds to launch cryptocurrency trading and investment management services. The firm is associated with Yunfeng Capital, which was co-founded by Alibaba founder Jack Ma, and has previously outlined plans to accumulate BTC, Ethereum (ETH), and Solana (SOL). These moves land alongside a policy reset from the top. In his annual address on Sept. 17, Chief Executive John Lee reaffirmed Hong Kong’s goal of cementing its position as an international hub in finance, including digital assets, while pairing that ambition with stronger investor safeguards. Tokenization and blockchain testbedThe centerpiece is Project Ensemble, run by the Hong Kong Monetary Authority (HKMA). The initiative is building infrastructure for a tokenized market and operates a sandbox where institutions can test blockchain systems in live business settings. Priorities include tokenized bank deposits, settlement of tokenized assets such as money market funds, and standardized issuance of government tokenized bonds. Regulation is advancing in parallel. The government is preparing legislation for a licensing regime that covers stablecoin issuers as well as digital-asset dealing and custody providers. The Securities and Futures Commission is studying an expansion of products for professional investors, with tougher protections baked in. The regulator plans to use automated reporting and data surveillance to curb misconduct. Authorities also intend to deepen cross-border cooperation to combat tax evasion. Banking rules are set to shift as well. The HKMA has circulated draft guidance that would ease capital requirements for certain crypto exposures in line with Basel standards through a new policy module called CRP-1. Under the proposal, assets issued on permissionless blockchains could qualify for lower capital charges when issuers demonstrate effective risk management. Hong Kong aims to implement the international rules by early 2026.Publicly traded BTC treasury firms in China Source: BitcoinTreasuries.NETAdoption amid constraintsNot every institution will join the build-out. Mainland policies may constrain participation, according to Caixin. Chinese digital platforms, state-owned enterprises (SOEs), and financial entities operating in Hong Kong could face limits on stablecoin and other crypto activity. Branches of several SOEs and Chinese banks are also unlikely to seek a Hong Kong stablecoin license. Corporate adoption remains broad despite those headwinds. Publicly traded Bitcoin treasury companies in China and Hong Kong hold a combined 19,280 BTC, according to BitcoinTreasuries.net. Several appear among the top 50 public corporate holders worldwide, including Next Technology Holding (16th), Cango (18th), Boyaa (24th), Nano Labs (48th), and Ming Shing Group (50th). The tally points to rising regional interest in digital assets. Publicly traded BTC treasury firms in Hong Kong Source: BitcoinTreasuries.NET