NEOPLY Receives Support from Abu Dhabi for Blockchain Expansion in UAE

Regulatory crackdown as Hong Kong authorities act against crypto entitiesIn a recent move, the Securities and Futures Commission (SFC) of Hong Kong has issued a public warning against suspected virtual asset-related frauds involving HongKongDAO and BitCuped, marking a significant crackdown on deceptive practices in the crypto space.The action taken by the SFC in conjunction with the Hong Kong Police Force was outlined in a notice published on Wednesday. The notice stated:“The SFC suspects HongKongDAO may be disseminating false and misleading information about itself and its business through online channels.”In relation to BitCuped, it stated: “The SFC notes that BitCuped claims on its website that ‘Laura Cha’ and ‘Nicolas Aguzin’ serve as its Chairman and Chief Executive Officer respectively, when in fact none of them has any affiliations with BitCuped.”Photo by Teodor Kuduschiev on UnsplashHongKongDAO’s alleged misinformationOperating under the name “Hong Kong Digital Research Institute,” HongKongDAO has faced accusations of disseminating false and misleading information. The SFC expressed concerns about the claims made by HongKongDAO, including assertions of licensing by the SFC, engagement in regulated activities since July 2020, and bids for a “Hong Kong Digital Currency Exchange Licence” related to the government’s stablecoins framework.The SFC contends that these claims are unfounded and could potentially mislead the public into believing that HongKongDAO’s services are officially sanctioned and legitimate.HongKongDAO seems to manage at least two Telegram groups, one in Chinese with over 10,000 members and the other in English with over 1,700 members. Within these groups, there appears to be a promotion of the purported “market” price and future market value of the HKD token, enticing investors to make purchases.Allegations of BitCuped false affiliationsSimultaneously, BitCuped has been accused of making fraudulent claims to enhance the credibility of its operations. The company falsely asserted affiliations with prominent figures Laura Cha and Nicolas Aguzin, claiming them as its chairman and CEO, respectively. However, the SFC has refuted these affiliations. Laura Cha is the Chairman of Hong Kong Exchanges and Clearing Limited (HKEX), while Nicolas Aguzin is the Executive Director and CEO of HKEX.Taking proactive measures, the SFC has requested the Hong Kong Police Force to block access to the websites of both HongKongDAO and BitCuped. Cease and desist letters have also been issued to the operators of these websites, demanding the cessation of the sale of HKD Tokens offered by HongKongDAO.Series of crypto scamsFollowing the JPEX fraud allegations in September, Hong Kong faced another cryptocurrency exchange scandal involving Hounax in November. With at least 145 police reports filed and a sum of over HK$148 million ($19 million) involved, affected investors expressed frustration at what they deemed a slow response from regulatory bodies.These incidents have reignited discussions about the need for more robust cryptocurrency regulations in Hong Kong. The city’s aspiration to become a global hub for crypto innovation and adoption faces challenges due to a lack of clear and consistent regulation, leaving investors vulnerable to fraud and manipulation.In light of these developments, the SFC emphasized the importance of public caution regarding investment opportunities that seem too good to be true. The regulator urged vigilance against social media and instant messaging platforms where individuals, not investment professionals, might lure unsuspecting investors.

Cryptocurrency exchange Backpack has recently forged a strategic partnership with Banxa, a global crypto on-ramp provider, to introduce a comprehensive digital asset on- and off-ramp solution. Onboarding into cryptoThis collaboration, announced by Banxa on Monday, marks a significant milestone for Backpack users globally. If crypto and Web3 are to live up to their promise, then on-ramping and onboarding people from conventional financial services is key to broadening out adoption. Given the service provided by Banxa, the partnership has great importance. Notably, Backpack Exchange, which recently secured a virtual asset service provider (VASP) from the Virtual Asset Regulatory Authority (VARA) in Dubai, emerged from the minds behind Solana's renowned Mad Lads NFT collection, adding a layer of credibility to this venture. Since then, the platform has been steadily expanding its operational footprint. Throughout the latter half of 2023, the exchange acquired several operational licenses across various jurisdictions worldwide, further solidifying its regulatory compliance and global presence. The platform’s user base spans across more than 130 countries. Banxa hit the headlines in the crypto sector earlier this month when it emerged that the firm’s UK affiliate had become the first entity in 2024 to take its place on the Financial Conduct Authority’s (FCA) crypto register.Photo by Shubham Dhage on UnsplashIndustry responseAnndy Lian, a Singaporean intergovernmental blockchain expert and the author of the book "NFT: From Zero to Hero," views this partnership as a game-changer for Backpack users. Lian told Cointelegraph that this link-up will add to the ease with which users can now engage in buying and selling cryptocurrencies using fiat currencies through various payment methods like credit cards, bank transfers and e-wallets. He emphasizes that such convenience will undoubtedly drive up the adoption and liquidity of Backpack and its associated tokens, thereby enhancing the overall user experience. Trading volume high pointThe announcement of this partnership comes on the heels of Backpack's achievement of surpassing $1 billion in 24-hour trading volume on Sunday, merely four days into the launch of its trading preseason. The exchange had already exceeded $300 million in daily trading volume within the first 24 hours of trading on Feb. 15. In light of this exponential growth in trading volume, Armani Ferrante, the founder and CEO of Backpack, took to the X social media platform to issue a word of caution to traders. Ferrante warned against potential overexcitement that might lead to unfavorable trading outcomes. Ferrante stressed the long-term vision of the platform and urged users to trade responsibly, emphasizing that Backpack has extensive development plans in store, with the preseason serving as just the beginning. Ferrante previously worked for bankrupt exchange platform FTX, which was seen as being at the center of the Solana ecosystem prior to its collapse. The Solana-based Backpack appears to be going some way in filling that void within the Solana community. With that, Solana-based trading pairs feature strongly in Backpack’s overall trading volume statistics. At the time of writing, SOL was trading at $109, down 1.7% over the course of the past 24 hours.  

Banking Difficulties Remain in Hong Kong for Crypto Start-UpsWhile Hong Kong has demonstrated a very clear crypto-friendly stance over the course of the past six months, crypto start-ups are still struggling with banking in the Chinese autonomous territory.Photo by Manson Yim on UnsplashLicensing backlogAll the signs are that Hong Kong is striving to develop itself as a regional hub for crypto and blockchain related business. Encouraged by that stance, against a background of the United States becoming openly hostile to crypto over that very same time frame, applications are streaming in from international firms to be licensed to operate their businesses in the city.In discussion with crypto start-up applicants, CoinDesk has established that the issue extends to firms that have already obtained a license to operate. To compound matters, the Hong Kong regulator, the Securities and Futures Commission (SFC), has a shortage of manpower, with just eight officials currently working on the applications of eighty crypto firms.Speaking to that backlog, Amy Yu, APAC CEO for Swiss crypto financial services company, SEBA Bank, stated: “This probably would have been a different story six or nine months ago.”A known problemIt appears that both the SFC and its regulatory peer, the Hong Kong Monetary Authority (HKMA) were aware of the issue and tried to get out ahead of it. Late last month, both regulators convened a meeting with bank officials and virtual asset service providers (VASPs).The objective was to try to forge a path forward such that banks could amend their approach, enabling greater facilitation and acceptance of crypto businesses such that the banks would be more inclined to approve bank account applications from those fledgling businesses.Arthur Yuen, Deputy CEO of the HKMA addressed the matter in a blog post published to the regulator’s website on April 27. Yuen was clear in calling on the banks to enable banking for VASPs:“With the implementation of the regulatory regime for VA [virtual assets] activities in Hong Kong and the strengthening of supervisory regimes in different jurisdictions according to the international standards, and as the banking industry develops a better understanding of the VA industry over time, we expect that regulated virtual asset service providers (VASPs) will be able to successfully apply for a bank account through a reasonable process.”Banker resistanceElaborating on the matter further, it’s clear that Yuen and his colleagues understand the importance of banking in enabling this nascent business sector such that the broader strategy of a pro-crypto business environment is affected in Hong Kong. “To attract businesses from new markets, it is crucial to have high quality financial services, while enhancing corporate access to bank accounts would be one of the key priorities,”he stated.An attendee at that regulator-organized round-table last month said that “It was more like a wish list from the regulator,” and that “whether the banks fully embrace it is another matter.” The issue remains as a major impediment to the ability of crypto start-up companies to operate, Some are being forced to try and work around the stumbling block, relying instead on overseas banking partners.