Matrixport’s Market Sentiment Index Points Towards Bullish Momentum

Su Zhu, the co-founder of the now-defunct Singaporean crypto hedge fund Three Arrows Capital (3AC), raised some eyebrows within the crypto community recently, having shared unconventional thoughts on his time spent in a Singaporean prison. Zhu's arrest took place in October of last year in Singapore, where he was apprehended while attempting to flee. Liquidators of 3AC had tipped off police in the city-state that Zhu was going to Changi airport, a number of days after they had secured a court order against him for failing to cooperate with their efforts to wind up the company. Alongside his business partner, Kyle Davies, Zhu was sentenced to four months in prison for contempt of court following a committal order.Photo by Christian Lue on Unsplash‘Enjoyable experience’Clips from an unreleased podcast were published on social media on Monday, in which Zhu referred to his time in prison as an "enjoyable experience overall." In the video podcast, Zhu expressed gratitude for his incarceration, even going so far as to claim that he had the "best sleep" of his life while behind bars. Zhu suggested that everyone should have the opportunity to experience prison at least once, believing it to be a beneficial and enlightening experience. He provided insights into his daily life during incarceration, emphasizing the simplicity of entertainment and drawing parallels with activities from "ancient days." The disgraced crypto boss discussed the routines and privileges within the prison facility, including access to ample reading material, opportunities for exercise and a structured diet. He highlighted the ability to read books and engage in physical activities like push-ups during his time in prison. What particularly impressed Zhu was the quality of sleep in the prison environment. He also found a sense of connection with his ancestors through the use of mats instead of beds. Crypto community responseCrypto users on various platforms responded with mixed feelings toward Zhu's philosophical insights. Some viewed his perspective with skepticism, while others found humor in the apparent contrast between his experiences and traditional notions of imprisonment. Taking to the X social media platform, pseudonymous crypto restructuring lawyer "Wassielawyer" wrote:”Singapore prison is widely regarded as one of the shittiest prisons you can find in a first world country. And the man made it sound like a 5-star mindfulness retreat everyone needs to go on in order to revitalize mind, body and soul. Man is blessed with a superpower…” The hedge fund collapsed in June 2022, resulting in over $3.5 billion in losses for investors, making it one of the largest hedge-fund trading losses ever. Zhu and fellow 3AC founder Kyle Davies have been active online over the course of the past year, despite their whereabouts largely remaining unknown during that time. The duo have launched a new crypto exchange and bankruptcy claims platform called Open Exchange (OPNX). However, their troubles continue, as liquidator Teneo seeks to recover $1.3 billion directly from the founders, alleging misuse of investor funds after 3AC became insolvent. In September, the Monetary Authority of Singapore (MAS) prohibited both from floating regulated investments for nine years. Teneo has estimated a 46% recovery rate in respect of creditor claims.  

Japan’s cryptocurrency market has surged to become the fastest-growing in the Asia-Pacific region, driven by a government overhaul of its digital asset policies. On-chain transaction value jumped 120% in the year ending June 2025, according to a new report from Chainalysis. The expansion signals renewed activity in a market long characterized by its cautious approach. The Japanese government is increasingly open to crypto as a mainstream investment class through a series of reforms, including proposed friendlier tax laws and the licensing of regulated stablecoins, aiming to attract investment and foster a domestic Web3 industry.Photo by Daniel Hehn on UnsplashOverhauling a strict tax codeA central pillar of the reform is a proposed change to Japan’s tax code, which currently subjects crypto gains to rates of up to 55%, compared with a flat 20% on stock profits. The ruling Liberal Democratic Party is backing proposals to introduce the same 20% rate for crypto starting in fiscal 2026, along with rules that would allow investors to carry forward losses for up to three years. The measures, which require parliamentary approval, are intended to align digital assets more closely with traditional financial instruments. Uncertainty has emerged, however, with Prime Minister Shigeru Ishiba’s decision to resign. Ishiba has been supportive of the crypto industry, and the LDP’s leadership election on Oct. 4 could reshape the policy outlook. Sanae Takaichi is seen favoring tighter oversight, Shinjiro Koizumi more receptive to digital assets, and Finance Minister Katsunobu Kato stressing a balance between investor protection and innovation. Paving the way for a stablecoin eraThis political transition coincides with a shift in the Japanese market, which remains heavily concentrated in just a few assets. Over the past year, yen-denominated trading was dominated by XRP with $21.7 billion in volume, outpacing Bitcoin ($9.6 billion) and Ethereum ($4.0 billion). While political developments add unpredictability to the outlook, successful regulatory reforms could set the stage for positive change. One potential catalyst is the government’s recent licensing of the first issuer of a yen-backed stablecoin. Stablecoin issuer JPYC received Japan’s first funds transfer service provider license in August, with its launch anticipated in October. Broader access to stablecoins, digital tokens pegged to fiat currencies like the U.S. dollar or yen, is expected to provide Japanese traders and institutions with a more familiar tool for settlement. Major financial players are also moving in this direction. SBI Group, a leading financial conglomerate, recently deepened its partnership with Ripple to distribute RLUSD, an enterprise-grade U.S. dollar-backed stablecoin, in Japan. SBI plans to make the regulated stablecoin available by March 31, 2026. Corporate Japan bets on blockchainAt the same time, SBI Group also recently partnered with infrastructure provider Startale Group to build a blockchain-based trading platform for tokenized real-world (RWA) assets like stocks. The venture is a bet on the burgeoning tokenization market, which Ripple and Boston Consulting Group (BCG) project could reach nearly $19 trillion by 2033. Alongside moves by major financial groups, Japan is also nurturing its homegrown Web3 talent through the J-StarX Program, coordinated by JETRO Dubai and sponsored by the Ministry of Economy, Trade and Industry. This year, more than half a dozen Japanese startups, together raising over $17 million, were selected for the initiative, spanning blockchain infrastructure, AI-driven platforms, and advanced fintech solutions.  Since August, the cohort has been preparing for international exposure, with showcases scheduled at GITEX GLOBAL 2025 in Dubai and a visit to Abu Dhabi’s Hub71 in October. The initiative reflects Japan’s strategy of expanding overseas networks for its startups while positioning them to access the UAE’s growing Web3 and fintech markets. 

Laos targets crypto operators’ unpaid feesIn a bid to enhance state revenues, Laos has turned its focus to the cryptocurrency sector, revealing that operators in the country owe a total of $20 million in fees. The announcement, reported on Thursday by Chinese state news agency Xinhua News, references information from the Lao People’s Army News.Photo by Alessio Roversi on UnsplashLoss-making mining activityLaos had previously granted authorization to 15 blockchain companies to engage in crypto mining or operate as exchanges as part of a strategy to diversify government income sources. However, Prime Minister Sonexay Siphandone disclosed that two of these companies showed no progress in their operations, while others lagged behind in meeting their financial obligations to the state.It emerged in August that the national electricity supplier, Electricité du Laos, had decided to suspend the supply of energy to crypto miners amid a perfect storm of challenges. Laos has ample hydro electric resources and is a net exporter of electricity. However, a drought this year has challenged it to honor contracts for supply of electricity to the Electricity Generating Authority of Thailand.To deal with this issue, power supply to Laotian crypto miners was suspended. To compound matters, many mining operators have been struggling financially and were unable to pay their bills.Debt reliefSiphandone mentioned that since the government initially set the tax obligations, the overall value of cryptocurrencies has experienced a 50% decline. Consequently, Laos has decided to alleviate the burden on crypto companies by reducing the outstanding balance by an equivalent 50%.Following this decision, the affected companies have commenced the settlement of their fees, and it is anticipated that all outstanding amounts will be fully resolved by the year’s end, according to the country’s Prime Minister. However, he issued a cautionary note, stating that companies failing to make satisfactory progress would face consequences, including the suspension of their operations, imposition of fines or even the revocation of their licenses.Digital transformationIn May, Laos outlined key aspects of its digital transformation strategy, emphasizing the use of digital technology to generate new fiscal revenue, strengthen foreign exchange reserves, control inflation, and promote sustainable economic growth. The move to reduce crypto companies’ tax burdens amid market volatility underscores Laos’ adaptability to the challenges presented by the dynamic cryptocurrency landscape.As part of its digital transformation strategy, the Laotian government signed a cooperation agreement with Singapore’s MetaBank. Partnering with another overseas entity, the country has also relied upon the expertise of Japanese fintech developer Soramitsu with regard to a central bank digital currency (CBDC). Soramitsu has played a pivotal role in enabling the issuance of Laos’ Digital Lao Kip.Early last year, the landlocked Southeast Asian country authorized trading licenses for two crypto platforms. These included Lao Digital Assets Exchange (LDX), a joint venture between Phongsupthavy Group and AIF Group, and Bitqik, a subsidiary company of Simuong Group.