Hong Kong Embraces Web3 Development with Dedicated Task Force

Upbit, South Korea’s largest cryptocurrency exchange operated by Dunamu, announced on Jan. 2 that its user base surpassed 13 million by the end of last year. With South Korea’s population at 51.6 million, the data implies that roughly one in four Koreans now holds an account on the platform. Demographic breakdowns show that users in their 30s comprise the largest cohort at 28.7%, followed by those in their 40s at 24.1% and 20s at 23.2%. Users in their 50s accounted for 16.9%, while those in their 60s and 70s made up 6.0% and 1.1%, respectively. Adoption is particularly high among younger generations, with the combined total of users in their 20s and 30s reaching 5.48 million. Based on Ministry of the Interior and Safety data showing 12.37 million people aged 20 to 39 as of November, approximately 44% of Koreans in this age demographic use the platform. Upbit added 1.1 million new users last year, with men comprising 56.9% of new accounts and women 43.1%.Photo by Kanchanara on UnsplashXRP overtakes BTC and ETH in tradingIn terms of trading volume, Ripple’s XRP was the most traded cryptocurrency in 2025, outpacing both Bitcoin and Ethereum. Daily activity peaked in the morning, coinciding with the start of the typical business day. The highest volumes were recorded at 00:00 UTC, or 9 a.m. Korea Standard Time. Beyond standard trading, users are increasingly turning to Upbit’s asset management tools. Since its 2022 launch, the platform’s staking feature has attracted over 300,000 users, generating 257.3 billion won ($178.6 million) in total rewards. Furthermore, a dollar-cost averaging feature introduced in August 2024 has drawn about 220,000 users, with cumulative investments totaling 478.1 billion won ($331.9 million). Kbank eyes public listingIn the broader ecosystem, Upbit’s banking partner is preparing for an initial public offering (IPO) this year. Kbank, an internet-only lender that has partnered with Upbit since 2020, is closely linked to the exchange through shared customers. According to Hansbiz, crypto-related funds accounted for roughly 16% of Kbank’s total deposits as of the first half of 2025. Under South Korean law, fiat-to-crypto service providers must secure real-name accounts from a local bank, meaning Upbit users are required to deposit Korean won at Kbank before trading on the exchange. However, Kbank’s financial performance has softened following the 2024 implementation of the Virtual Asset User Protection Act, which compelled the bank to raise annual interest rates on deposits from Upbit users from 0.1% to 2.1%. On a consolidated basis, net interest income totaled 323.2 billion won ($224 million) in the third quarter of 2025, down 13% year over year. Net fee income remained in the red, posting a loss of 2.8 billion won ($1.94 million), widening from a 1.3 billion won loss in the same period a year earlier. This latest IPO push follows two failed attempts and carries contractual implications. When Kbank raised 725 billion won ($503 million) in 2021 from investors including Bain Capital and MBK Partners, it pledged to list its shares by July 2026. If the upcoming attempt fails, those backers could exercise drag-along rights and put options, potentially resulting in increased financial obligations for Kbank. Meanwhile, Upbit has seen other notable shifts in its business and governance. In November, Dunamu and Naver Financial, a subsidiary of internet giant Naver, approved a merger plan structured as a comprehensive share swap at a ratio of 1 to 2.54. At the time of the announcement, market observers estimated Dunamu’s valuation at 15 trillion won ($10.4 billion), compared with 5 trillion won ($3.5 billion) for Naver Financial. 

Binance withdraws Abu Dhabi bid amid global licensing reevaluationLeading global crypto exchange Binance has chosen to withdraw its bid for a trading license in Abu Dhabi, according to information gleaned from the Abu Dhabi Global Market (ADGM) register and a report published by Reuters on Thursday.Photo by Demid Druz on UnsplashChange of directionThe local subsidiary company responsible for the application, BV Investment Management Limited, initially submitted its licensing bid on Nov. 15, 2022. Much has changed in the crypto space and in the fortunes of Binance over the course of the past year, leading the firm to withdraw its application on Nov. 7.This proposed license would have granted Binance the authority to pool and invest funds from professional investors. The decision to retract the bid is part of Binance’s broader reevaluation of its overall strategy going forward. “When assessing our global licensing needs, we decided this application was not necessary,” a spokesperson from the company told Reuters.Adapting to new circumstancesMuch has changed for Binance in 2023. The company has been combating regulatory pushback in multiple jurisdictions worldwide, not least in the United States, where Binance founder Changpeng Zhao (CZ) recently reached a plea agreement with U.S. prosecutors and agreed to pay $4.3 billion for violations related to money laundering and sanctions laws.As part of that process, CZ stepped down as CEO, passing the leadership to Singaporean Richard Teng. Teng is a former regulatory executive who previously oversaw the exchange’s regional operations. A spokesperson for the company maintained that this recent decision relative to licensing in Abu Dhabi is entirely unrelated to the recently agreed-upon settlement in the United States.UAE tiesWhile Binance may be dropping its attempts to gain licensing in Abu Dhabi, in July the company acquired a Minimum Viable Product (MVP) license from the Virtual Assets Regulatory Authority in the United Arab Emirates’ (UAE) other major center, Dubai. The UAE is also the location where CZ has established his home.Some had speculated that the company had also established its headquarters within the UAE. However, CZ has always refused to disclose the firm’s global headquarters, instead suggesting that the firm has no global headquarters. Teng has taken a similar approach.Binance was originally founded in China in 2017. It then shifted its headquarters to Japan and later established a base in Malta to circumvent regulatory challenges in China. Similarly, it’s thought that regulatory scrutiny provides the rationale for the company’s ongoing stance in refusing to confirm the location of its corporate headquarters.Despite regulatory challenges, Binance had previously expressed a focus on expanding its operations in the Middle East, known for its crypto-friendly environment and specific regulatory frameworks. Binance holds various crypto licenses from regulators in the region. In May of last year, it acquired a Category 4 crypto-asset service provider (CASP) license from the Central Bank of Bahrain.The exchange maintains registrations and licenses across Europe, Asia and other regions. It’s had mixed fortunes in its endeavors over recent months, driven out of some markets while making in-roads in others. Earlier this week, its Binance Japan subsidiary became fully operational. Last week, regulators in the Philippines moved against the company due to regulatory irregularities.

Terraform Money Trail Leads to Swiss BankAuthorities in both South Korea and the United States continue to advance their investigations into Terraform Labs, the Singapore-based company behind collapsed algorithmic stablecoin Terra USD (TUSD) and its South Korean CEO, Do Kwon, with the latest developments involving transfers made to a Swiss bank.©Pexels/Robert StokoeFollowing the moneyIn a lawsuit filed by the Securities and Exchange Commission (SEC) in the United States in February, the Commission claimed that Do Kwon and his company Terraform Labs transferred 10,000 Bitcoin to a Swiss bank. It now appears that the bank in question is digital asset banking specialist, Sygnum Bank.It’s understood that Do Kwon converted a large proportion of that Bitcoin into cash. According to Finbold, the Financial Securities Crime Joint Investigation Division at the Seoul Southern District Prosecutor’s Office has disclosed that it is following the digital asset trail to Switzerland in an effort to secure associated funds.LFG fundsThe funds are believed to have belonged to the LUNA Foundation Guard (LFG), an entity that was established with the objective of building reserves and safeguarding the USD peg of the Terra USD algorithmic stablecoin during volatile market conditions.Roughly 130 billion won, or $100 million, is being pursued, between digital assets and cash held within various Sygnum accounts. South Korean authorities had previously indicated that they were investigating transfers made by Do Kwon to a prominent Korean law firm. Earlier this week, they charged ten individuals connected to Terraform Labs with various offenses.During the press conference in which those charges were brought, the Seoul Southern District Prosecutor’s Office stated:”We have also confirmed that $100 million has been used in several places, not left in the Sygnum account as it is, and some transfers have been made to the Kim & Chang law firm account (at the attorney’s expense) and the remaining amount is about billions of won.”International complexityThis recent phase in the investigation is revealing the international nature of the case and the complexity that brings with it. Authorities in the United States and South Korea have submitted requests to have certain Sygnum Bank accounts frozen. Do Kwon and Terraform Labs are trying through the courts to have the SECs involvement dismissed on the basis that Terraform was a Singaporean company and Do Kwon a South Korean national, and on that basis they claim that the SEC lacks jurisdiction.Sygnum, being a Swiss entity will have to abide by what Swiss authorities instruct it to do relative to the Terraform-related funds held in accounts with the bank. Sygnum told Finbold that it couldn’t comment on whether it had received requests to freeze assets.The bank stated: “We can communicate that after the collapse of Terra in May 2022, on the basis of an official court order, Sygnum transferred more than 70% of the Bitcoin-sale FIAT proceeds into the escrow account of an international and to other reputable law firms.” It added that no Swiss or foreign authority has accused Sygnum of any wrongdoing.