Myanmar Government in Exile Backs Crypto Bank Launch

Fingerlabs, a subsidiary under South Korean digital marketing firm FSN, has secured a strategic partnership with the OGN gaming television channel to work on a blockchain-based content and IP project by utilizing its Web3 content distribution hub Xclusive, according to local news site Digital Times on Tuesday (KST).Photo by Luis Villasmil on UnsplashFrom Starcraft to the metaverseSince its inception as Ongamenet in 2000, OGN has grown significantly by broadcasting Starcraft matches, thus popularizing esports and leading the global standard for esports broadcasting. After being acquired by global league stats website OP.GG in 2022, OGN has been expanding its range of content to include other, more innovative games and technologies such as VR, XR, and the metaverse. It also recently launched a live channel and VOD service on the popular Korean OTT service Wavve. Through this partnership, the two companies plan to produce and distribute Web3 content through Xclusive by leveraging various IPs owned by OGN. The South Korean market has already been a hotbed of esports since the early 2000s when Starcraft’s popularity skyrocketed. More recently, the country’s interest and reputation in esports has grown exponentially when it hosted the League of Legends World Championship last year. Subsequently, expectations are building for Web3 content based on OGN's IPs. Xclusive’s journeySince it transitioned from a traditional NFT marketplace to a Web3 content distribution platform, Xclusive has teamed up with various projects. This includes the upcoming BTS Universe-based drama "Begins Youth," as well as the popular South Korean singing competition Miss Trot Season 3. This, coupled with the OGN collaboration, is expected to pave the way for Xclusive to expand beyond entertainment-related content and into the gaming industry.

Taiwan Advances Crypto Regulation with Initial Reading of Digital Asset BillTaiwan has furthered its efforts on the path of digital asset regulation, as the nation’s legislature introduced a cryptocurrency bill for its inaugural reading.The “Virtual Asset Management Ordinance Draft” bill represents a significant stride toward establishing a legal framework for digital assets in the country. The proposal passed its first reading at the Taiwanese state legislature, according to published parliamentary records.Photo by Ethan Lin on UnsplashBill objectivesThe primary objectives of the bill are to define virtual assets, establish operational standards for asset operators, enhance customer protection, and make it mandatory for industry players to join relevant associations and secure regulatory permissions.Up until now, Taiwan has maintained a relatively hands-off approach to the cryptocurrency sector. Its oversight was limited to existing know-your-customer (KYC) and anti-money laundering (AML) laws. However, this stance evolved following the collapse of the cryptocurrency exchange FTX in November. The platform’s popularity among Taiwanese users, owing to favorable US dollar interest rates compared to local banks, led to increased regulatory scrutiny.A member of Taiwan’s parliament, Yung-Chang Chiang, told The Block that “after the first reading of the bill, discussions on the regulatory framework for the virtual asset industry have progressed to the next stage.” Chiang added:“We hope that the Financial Supervisory Commission can also submit their version of a draft bill to the legislature, allowing various sectors of society to further consolidate consensus during the process.”In contrast to cryptocurrency regulations in neighboring Hong Kong, Taiwan’s bill does not adopt a strong stance on derivatives or stablecoins. Nevertheless, it recognizes that derivatives linked to virtual assets possess unique characteristics, with a specific mention of perpetual contracts. This recognition opens the door for the possibility of cryptocurrency derivative-specific regulation in future drafts.Importantly, the bill does not restrict the trading of virtual assets to professional investors, which allows broader participation in the digital asset market.Auditing and segregation of fundsUnlike Japan, which mandates the use of custodians for locally licensed exchanges, the draft bill in Taiwan only necessitates the segregation of customer assets from business funds. It does not explicitly require the involvement of third-party custodians.Under this legislation, exchange operators will be obliged to commission periodic reports from accountants regarding their operations and asset management. Additionally, regulators, such as the Financial Supervisory Commission (FSC), will have the authority to conduct regular inspections of exchange internal control and audit systems.Although this initial draft does not explicitly mention “Proof of Reserves,” it does indicate that the regulator will establish standards for asset ratios after consulting with industry stakeholders, with the expectation that licensed exchanges will adhere to these standards.Fostering self regulationTaiwan’s crypto industry stakeholders have expressed their support for formal regulatory oversight. Wayne Huang, co-founder and CEO of Taipei-based fintech company XREX, recently affirmed the industry’s willingness to collaborate with the FSC in defining regulatory operations.In tandem with the establishment of a regulatory framework, regulators have indicated that they want industry stakeholders to move towards some level of self-regulation. That led nine exchange businesses to form an industry association last month.The bill’s second reading is pending, and the FSC is anticipated to provide its input and recommendations before the next phase of the legislative process.

Seoul and Baobab Partners Face Controversy Over Unpaid Prize Winnings for SWF2023 HackathonThe city of Seoul has come under public scrutiny for failing to pay the winners of the Seoul Web3 Festival (SWF2023) Hackathon a cash prize worth KRW 150 million (approximately $112,000). The Seoul Metropolitan Government has argued that since it was simply a naming rights sponsor, the responsibility for paying the prizes lies with Baobab Partners, who co-hosted the event. However, critics argue that the city did not properly vet Baobab Partners more rigorously before hosting the event.Photo by okaybuild on PixabayUnpaid prizes lingerThe SWF2023 Hackathon took place from July 31 to August 2 at Dongdaemun Design Plaza (DDP) and was co-hosted by the city of Seoul, the Seoul Design Foundation, and Baobab Partners. It offered a total prize pool of KRW 150 million attracting 417 participants who made up 115 teams.However, although over two months have passed since then, the winners are yet to be paid their prize money. “Baobab Partners initially proposed the SWF2023 event, and they were responsible for gathering the necessary sponsorship funds to run the event,” said a city representative.According to industry sources on Monday, the company’s CEO, Choi Jin-beom, issued a handwritten apology last Friday regarding the incident. “We promised to pay the winners by today, but we were unable to deliver on that promise. We explored multiple avenues, including investors, new contractors, and other assets, but were ultimately unable to secure the funds to do so,” he said. “The narrative that the funds were diverted elsewhere or invested in cryptocurrencies or stocks is untrue,” he added, clarifying that related information was transparently disclosed to the city of Seoul.Baobab Partners’ swift rise raises industry eyebrowsBaobab Partners had previously participated as an event planner at last year’s Blockchain Week in Busan, which turned out to be a success. “We also spoke with the Busan city government, who gave a positive opinion of the company,” the representative added. It was under this context that Seoul entered into a naming rights agreement with Baobab Partners. The agreement stipulated that the company would be in charge of attracting and managing sponsorships, and the prize money and operational costs would be covered by corporate sponsorship funds.Nevertheless, questions have arisen within the industry about Baobab Partners’ short track record and its successive collaborations with public organizations. Baobab Partners is a startup that was founded in May 2021. In November of the same year, the firm signed memoranda of understanding with three blockchain companies during NFT Busan 2021, a large-scale NFT fair held in the southern port city to share the latest blockchain trends. As a result of its efforts, it was listed alongside prominent companies such as Coinone and Onther despite only six months passing since its establishment. Subsequently, Baobab Partners relocated from Seoul to Busan, and the following year, it participated as an event planner at Blockchain Week in Busan.Accumulating allegationsSpeculation suggests that this success was not solely due to Baobab Partners’s capabilities. The company’s CEO is believed to have political connections, according to an anonymous industry insider. Choi denied such claims and stressed that its technical expertise should not be downplayed, citing the fact that Baobab Partners was the first entity in Korea to develop virtual reality (VR) banking technology and had received a KRW 15 billion investment from Finger, a KOSDAQ-listed company.Baobab Partners has also been mired in controversy over supposedly unpaid wages. In response to a claim made by an industry source that many former employees of Baobab Partners have still not received their due wages, a Seoul representative stated that there is no such dispute according to conversations with company representatives, seeking to dispel the dispute. Choi further explained, “We didn’t have wage disputes until last year. The difficulty in paying wages began in January this year due to the failure to execute promised investment funds.”The city said that it is currently conducting legal examinations and looking into necessary measures for two matters involving Baobab Partners, including the handling of hackathon winnings.