Hana Financial Group Joins Hands with Netmarble to Attract Digitally Savvy Youths to the Metaverse

Blockchain firm PiLab Technology has signed a strategic memorandum of understanding (MOU) with Mirae Asset Securities to collaborate on creating Web3 infrastructure – namely Web3 technology for identity authentication – and identify asset management trends in the Web3 sphere. This comes in an effort to establish leverage in the emerging tokenized securities market, according to Korean news outlet The Block Post on Thursday (KST).Photo by GuerrillaBuzz on Unsplash"Through our collaboration with Mirae Asset Securities, we expect to play a major role in the convergence of blockchain technology and financial markets," said Park Do-hyun, CEO of PiLab Technology. "PiLab Technology will continue to lead the way in making Web3 services more user-friendly." Financial giants uniteMirae Asset Securities is the largest investment banking and stock brokerage company by market capitalization in South Korea. The firm previously co-founded a financial innovation consortium with telecommunications conglomerate SK Telecom called Next Finance Initiative, which is preparing to issue tokenized securities by operating a token securities working group on a global blockchain network. Hana Financial Group also recently joined the consortium as a member company. Pioneering services in Web3Meanwhile, PiLab Technology operates its own multichain network called Bifrost, which houses a deposit and lending DeFi service called BiFi. The company has previously raised KRW 14 billion (approximately $10.9 million) in funding from venture capital firms like Korea Investment Partners and more. Last month, PiLab teamed up with the Korea Information Certificate Authority (KICA) and Travel Rule solutions provider CODE to establish an authentication system to advance the country’s Web3 environment. 

Japanese Exchanges Canvas Regulator to Permit 10x LeverageJapan’s cryptocurrency exchanges are advocating for looser regulations on margin trading, despite the global digital asset market crash experienced last year.According to a report published by Bloomberg on Monday, The Japan Virtual & Crypto Assets Exchange Association has revealed that many industry insiders are seeking leverage limits of four to 10 times for retail investors.Currently, customers are limited to doubling their exposure through borrowing. Genki Oda, the Vice Chairman of the association, believes that relaxing the leverage rule could enhance Japan’s appeal to crypto and blockchain companies, thereby stimulating increased trading activity.Photo by Su San Lee on UnsplashOngoing discussionJapanese digital asset exchanges are currently engaged in discussions to establish a consensus on the recommended leverage limit. They are planning to present their proposal to the Financial Services Agency (FSA) as early as next month.While Japan has made some efforts to ease certain cryptocurrency regulations, such as token listing and taxation, the overall regulatory environment is considered strict. The FSA expects crypto firms to provide solid justifications for loosening margin trading caps, demonstrating how it would contribute to the government’s objective of expanding blockchain-based industries. However, the agency remains open to discussions with digital asset businesses on the matter.Plummeting trade volumesPreviously, Japanese crypto platforms offered leverage up to 25 times, resulting in annual margin trading volumes of approximately $500 billion in 2020 and 2021. However, after the FSA imposed a limit of two times to curb excessive speculation and protect investors from amplified losses, trading volumes plummeted by 75% in 2022.In other parts of the world, digital asset exchanges typically offer spot margin trading with leverage ranging from five to 10 times the initial deposit, depending on local regulations. Some platforms even offer more aggressive lending options, often associated with speculative behavior that can generate waves of greed and fear within the crypto market.Oda argues that digital asset volatility has decreased since 2020 and asserts that Japanese exchanges are well-prepared to assist investors in managing the risks associated with margin trading positions. However, any relaxation of leverage rules is not expected to occur before 2024.Leverage dangersLast year’s global cryptocurrency downturn exposed risky practices and resulted in numerous bankruptcies. Regulators worldwide have responded by implementing new rules and regulations that address the lessons learned. While leverage might be in the interests of the exchange operators, many industry commentators have warned that leverage brings about market weakness.Caitlin Long, Founder and CEO of Custodia Bank, has been one such commentator, warning that massive leverage “built an industry of insolvent intermediaries” on a “foundation of sand”. It’s commonly believed that leverage leads to unsustainable market bubbles rather than iterative organic market growth.In 2022, an index tracking the top 100 cryptocurrencies partially recovered, showing a 33% increase since the beginning of this year. However, the market still faces challenges, as institutional and individual investors have exited, leading to reduced liquidity and lower expectations for price volatility in Bitcoin and other cryptocurrencies.

Cake Group co-founder files application to wind up company in SingaporeChua U-Zyn, the co-founder and Chief Technology Officer of crypto firm Cake Group, has officially applied to the Singapore High Court to initiate the winding-up process for the company.A winding-up notice appeared in Singapore’s The Straits Times on Thursday. U-Zyn is being represented by law firm Rajah & Tann on the matter. The court will now decide whether to grant this application, which was filed on Dec. 1.Photo by Kelvin Zyteng on UnsplashFinancial strugglesCake Group is the parent company of the crypto platform Bake, which made headlines last month for announcing significant staff reductions affecting 30% of its workforce. Bake is an automated market maker (AMM) and decentralized exchange (DEX) that revolves around Binance’s BNB Smart Chain (BSC).In existence for some five years, the platform claims to have over 1 million users worldwide, retaining over $1 billion in customer assets and having achieved reward payouts to date of $411 million.Cake Group’s financial struggles have been evident, with its revenue plummeting by over half to $266 million in 2022, while profits experienced a fivefold decrease to $23.5 million during the same period. The company generates income through transaction fees.A hearing for creditors or opposing parties is scheduled for Dec. 22, providing an opportunity for stakeholders to voice concerns or contest the winding-up process.Internal disputeWhile the specifics behind U-Zyn’s winding-up application remain unclear, the decline in financial performance and the recent layoffs are undoubtedly contributing factors.It’s understood that CEO Julian Hosp learned about the filing on Dec. 6 and has since emphasized that the company is actively working with legal counsel to challenge the application. Hosp will challenge this request in court, asserting that the company’s finances are strong and unrelated to the dispute.Taking to the X social media platform on Thursday, Hosp wrote:”Disappointed to see U-Zyn filing a request on December 1st” . . . “For me, it’s selfish that he’s prioritizing his own interests over those of our customers, employees, and partners, instead of resolving it internally.”Hosp added that U-Zyn’s application is unrelated to the company’s finances and that the firm is financially solvent.Former employees, speaking anonymously to Tech in Asia, expressed surprise at the escalating situation, describing the co-founders as emotionally charged and seemingly unable to safeguard their investment.U-Zyn opposed to layoffsThe court filing under Section 125(1)(i) of the Insolvency, Restructuring and Dissolution Act of 2018 adds an element of uncertainty. Unlike other sections that typically specify reasons for winding up, this particular section allows for liquidation if “the Court is of the opinion that it is just and equitable that the company be wound up.”Hosp clarified that the application is not based on Cake Group’s inability to pay its debts, emphasizing that day-to-day operations continue at full capacity.It’s understood that the ongoing dispute between U-Zyn and Hosp stems from internal disagreements, particularly related to cuts within the company’s engineering division. Chua claimed Hosp excluded him from decisions, especially concerning the recent layoffs.Despite the internal discord, Hosp stressed the company’s commitment to resolving the dispute swiftly and maintaining its operational capabilities. Undeterred by his fellow co-founder’s actions, he published a blog post on Thursday, outlining his vision for the Cake Group moving forward.