Japan’s HashPort Group Raises $8.5M in Funding Round

South Korean credit card companies are preparing to develop a stablecoin-powered payment system, Yonhap Infomax reported. The Credit Finance Association (CREFIA)—a nonprofit comprising credit card firms, leasing companies, and venture capitalists—plans to launch a second task force this month. The group aims to prepare for the anticipated regulatory framework governing stablecoins.Photo by rupixen on UnsplashStablecoin cards, settlement under reviewThe task force will discuss building a comprehensive system covering the entire transaction process, from stablecoin-based card payments to merchant settlements. The agenda also includes testing stablecoin-powered debit cards, which would allow users to pay at standard card terminals just as they would with traditional cards. This second task force will include nine credit card companies—including Samsung Card, Shinhan Card, and KB Kookmin Card—that participated in the initial task force formed last July. At that time, CREFIA and the participating firms held weekly meetings on regulatory and technological issues while gathering input from external advisors. Through that process, the group examined whether credit card companies could legally engage in stablecoin businesses under the current Specialized Credit Finance Business Act. They also jointly filed 30 stablecoin-related trademark applications and reportedly sought consultations with financial authorities on securing payment and settlement accounts for stablecoin transactions. This push into the sector comes despite lingering uncertainty regarding the government’s phase-2 virtual asset legislation. Progress on the draft has been delayed due to disagreements between financial and monetary authorities. The Bank of Korea favors a model where only consortia with majority bank ownership can issue stablecoins. By contrast, the Financial Services Commission opposes setting a specific bank-ownership threshold in law to allow participation by non-bank firms. The forthcoming legislation is expected to comprehensively regulate stablecoins, including their issuance, distribution, and custody, leaving companies to await clearer guidance. Despite the legislative delays, the credit card companies are positioning themselves to move quickly once the rules are finalized. Investor sentiment shifts to U.S. equitiesWhile traditional financial firms explore digital assets to expand their business, South Korean investors are prioritizing U.S. equities over cryptocurrencies for this year. According to a weekly survey of 2,000 respondents conducted by CoinNess and Cratos, 30.8% said they plan to focus on U.S. stocks. Cryptocurrencies ranked second at 25.5%, followed by gold and silver (18.3%), Korean stocks (12.8%), and cash (12.7%). Market sentiment toward Bitcoin also appears cautious. 22.7% of respondents said they expect Bitcoin to rise or surge this week, down from 28.9% the previous week. Meanwhile, 38.3% predicted the price would move sideways, while 39% expected a fall or plunge. Asked about the broader crypto market, 50.8% of respondents said fear or extreme fear was prevailing. 

28 crypto service providers register with India’s FIUIn India, 28 entities providing services related to virtual digital assets (VDAs) have successfully registered with the Financial Intelligence Unit (FIU), the body responsible for combating money laundering in the world’s most populous country.Notable names in this list include Neblio Technologies, more commonly known as CoinDCX, Zanmai Labs, the company responsible for the WazirX crypto platform, Bitcipher Labs’ CoinSwitch, Nextgendev Solutions and Awlencan Innovations India’s Zebpay.Photo by Big G Media on UnsplashA need to register as ‘reporting entities’This information comes in response to a question posed in the Lok Sabha (India’s lower house of Parliament), where the government emphasized the significance of these entities complying with the Prevention of Money Laundering Act (PMLA). In March, the government had formally designated companies dealing in VDAs, crypto exchanges and related intermediaries as “reporting entities” under the PMLA.According to the notification, crypto exchanges and their intermediaries are obligated to conduct Know Your Customer (KYC) procedures for their clients and platform users. This includes maintaining KYC details, identity documents, account files and business correspondence records with clients.Offshore exchanges required to registerMinister of State for Finance Pankaj Chaudhary mentioned that the registration process for VDA service providers catering to the Indian market is underway. Non-compliance with these regulations may result in appropriate action under the PMLA. It has been clarified that offshore crypto exchanges operating in India are required to adhere to these guidelines. Despite that, none of the 28 entities who have registered so far appear to be offshore companies.Commenting on the development via the X social media platform, Sumit Gupta, Co-Founder of CoinDCX, wrote:”Emphasizing compliance to PMLA is vital for the safety and financial integrity of Indians, as dealing with non-registered platforms exposes citizens to nefarious actors, putting their finances at risk.” . . . “It’s encouraging to witness the Government initiating actions against non-compliant offshore entities.”While steps to provide guidelines for the industry are largely positive, the Reserve Bank of India (RBI) has been vocal in its criticism of cryptocurrencies and calls for potential bans have cast a shadow over the industry in India. The recent collapse of prominent platforms like FTX have not been helpful, only serving to exacerbate concerns relative to India’s crypto ecosystem.The negative sentiment, coupled with an ongoing funding winter, has resulted in the closure of operations for some crypto platforms, including Pillow and WeTrade, this year. Firms like CoinSwitch and Gupta’s CoinDCX have had to reduce headcount in 2023 amid challenging market conditions.Despite these challenges, there are also positive signs. A recent report by blockchain analytics firm Chainalysis found that India has been the frontrunner more recently in terms of crypto adoption in Asia.This latest development provides guidelines where anti-money laundering processes are concerned for crypto firms in India. However, the government needs to follow through with a complete regulatory framework for the industry. The Indian courts recently declined to act on such a petition on the basis that it falls within the remit of the country’s legislature and is outside the purview of the courts.

Victory Securities granted approval for retail crypto trading in Hong KongHong Kong’s Securities and Futures Commission (SFC) has given the green light to Victory Securities, a well established investment firm headquartered in the Chinese autonomous territory, for retail virtual asset trading.Photo by Carlos Alberto Gómez Iñiguez on UnsplashFirst licensed corporationThe license will allow the investment firm to expand its crypto trading and advisory services to retail investors. The publicly traded company announced its crypto licensing achievement via a press release published to its website on Friday. In that statement, the company expressed the hope that “by connecting traditional finance with virtual assets, customers can configure assets in a flexible and convenient way, and [we] can provide general investors with investment advice on virtual assets and publish relevant research reports.”This approval marks Victory Securities as the first licensed corporation in Hong Kong to offer such services to the retail market, joining the ranks of already approved firms like HashKey Exchange and OSL Digital Securities. It builds upon previous licensing approval that the company received from the SFC to offer a full range of trading and advisory services in respect of virtual assets to institutional clients in November 2022.The move reflects Hong Kong’s commitment to crypto regulation, as earlier this year, the region established a framework enabling the provision of crypto services to retail clients. This development positions Hong Kong as a key player in the Asian crypto market, where firms seem to be receiving more regulatory clarity compared to their counterparts in the United States. The regulatory initiative gains significance in light of the recent JPEX scandal, involving an alleged HK$1.6 billion ($204 million) fraud.Bringing retail into cryptoVictory Securities, currently listed as an applicant on the SFC’s recently published roster of virtual asset trading firms, is navigating this regulatory landscape to bring retail investors into the crypto market. In parallel, HashKey Group, another Hong Kong-based cryptocurrency firm, has launched the city’s first SFC-approved trading app since the JPEX incident. HashKey Exchange’s app, boasting “full mobile trading capabilities,” became operational this month, a notable progression given its prior limitation to professional investors.Through HashKey’s app, local traders can now engage in bitcoin and ether transactions using funds from their Hong Kong or U.S. dollar bank accounts. In addition to pioneering retail crypto trading, HashKey has introduced its crypto over-the-counter (OTC) trading service, HashKey Brokerage, aligning with local securities regulations and the recently implemented cryptocurrency regulatory framework by the SFC.The Hong Kong regulator is also believed to be currently weighing up whether to allow retail investors the ability to access spot crypto exchange-traded funds (ETFs). Despite these advancements, the SFC maintains restrictions on retail traders engaging in stablecoin transactions until new regulatory arrangements are established. This decision follows the SFC’s consultation paper on regulating crypto activities, emphasizing the need to address risks associated with stablecoins and their regulation.The regulator aims to ensure appropriate management of stablecoin reserves to maintain price stability and safeguard investors’ redemption rights, underscoring the potential significant implications for stablecoin stability if these risks are not effectively managed.As Hong Kong solidifies its position in the evolving crypto landscape, Victory Securities’ approval signifies yet another milestone in the region’s journey toward fostering a regulated and inclusive crypto market for retail investors.