Korean Parliament to Hold Hearing on Virtual Assets Amid Controversies

Key appointment sees Turkey’s central bank enhance crypto expertiseTurkey’s President, Recep Tayyip Erdogan, has taken a step in integrating blockchain and cryptocurrency expertise into the nation’s monetary policy by appointing Professor Fatma Ozkul to the central bank’s rate-setting committee.Photo by Engin Yapici on UnsplashIncorporating digital financial knowledgeThis decision, which became effective on Saturday, marks a significant move towards incorporating digital financial knowledge within the economic framework of Turkey.As part of Turkey’s economic strategy, President Erdogan has been restructuring the economic management team since his victory in the May general election. This reshuffling included the appointment of ex-Goldman Sachs banker Hafize Gaye Erkan as the central bank’s governor in June.That appointment led to a series of policy rate increases, totaling 3,400 basis points, bringing the rate to 42.5%. Further changes in the Monetary Policy Committee (MPC) occurred in July, reinforcing the trajectory of monetary tightening.Crypto credentialsProfessor Fatma Ozkul, a lecturer at Istanbul’s Marmara University, joins the MPC with a primary focus on accounting, finance and auditing. Notably, she brings expertise in blockchain technology and crypto assets, having conducted courses on these subjects. Her recent work has delved into the implications of blockchain and crypto assets on finance, culminating in the publication of a book on crypto asset accounting in 2022.While Ozkul’s appointment may not immediately alter the current monetary policy direction, it reflects an understanding of the need to incorporate digital financial tools when formulating economic and monetary policy. Her extensive knowledge in digital finance is expected to contribute significantly to the process of setting benchmark interest rates, a critical instrument in controlling inflation within Turkey.President Erdogan’s emphasis on digital banking aligns with Turkey’s proactive steps in this direction. The central bank introduced a digital Turkish lira collaboration platform in 2021 and successfully tested digital lira transactions in late 2022. Additionally, the government is anticipated to submit a draft law regulating crypto assets in the coming year.Crypto adoptionThe political and economic climate in Turkey has shown a growing interest in cryptocurrencies, particularly Bitcoin. Chainalysis, a blockchain analytics company, reports that Turkey recorded nearly $170 billion worth of cryptocurrency transactions between July 2022 and June 2023, ranking fourth globally in terms of raw transaction volumes.A report by KuCoin earlier this year identified a noteworthy increase in the overall number of crypto investors in Turkey over the course of the past 18 months. That growth in adoption was found to be youth-driven. The importance of the Turkish market within the crypto sector is further evidenced by the recent revelation that the Turkish Lira is the most dominant fiat trading pair on leading global crypto exchange Binance.In response to this surge, the Turkish government has been working on cryptocurrency regulations, focusing on licensing and taxes. This regulatory move aims to remove Turkey’s name from the Financial Action Task Force’s “gray list” and align the country with global financial norms.As Professor Ozkul assumes her role, her expertise and input may well play a pivotal part in shaping Turkey’s evolving position and approach where digital assets, blockchain and cryptocurrencies are concerned.

Shares in Moon Inc. (formerly HK Asia Holdings Limited), a publicly listed Hong Kong-based firm that acts as an investment holding company while engaged in activities such as wholesale and retail sales of prepaid products such as SIM cards, have surged following the company’s symbolic purchase of one Bitcoin (BTC).Photo by Thought Catalog on Unsplash93% share price increaseThe stock (1723.HK), which is listed on the Hong Kong Stock Exchange (HKEX), closed at HKD 5.50 following Monday’s trading. That represents a 93% increase compared to the closing share price following the previous day’s trading. The share price has settled somewhat following Tuesday’s trading, pulling back 16% to HKD 4.60. However, it jumped again on Feb. 21, closing at HKD 6.48. Bitcoin adoptionIt’s believed that the stock has been influenced by a decision taken by the company to adopt Bitcoin. The firm bought just one Bitcoin. However, the move has led to speculation as to whether Moon Inc. will become the MicroStrategy (now rebranded as “Strategy”) of China.  Michael Saylor’s Strategy has pioneered the use of Bitcoin as a corporate treasury asset. The company has positioned itself as the frontrunner in terms of the corporate adoption of Bitcoin. The company has amassed 471,000 Bitcoin within its reserves. This accounts for 2% of all Bitcoin. With Strategy’s Bitcoin playbook having been well documented, other companies now appear to be following its lead.  In recent weeks, Metaplanet, a Japanese Bitcoin treasury company, has demonstrated that it is pursuing the same strategy, outlining its ambition to build a reserve of 21,000 Bitcoin by 2026. On Feb. 18, it announced a 10-to-1 stock split in an effort to improve liquidity while executing on that overall Bitcoin treasury goal. Metaplanet shares have surged 3,900% over the course of the past 12 months on the back of its Bitcoin treasury pivot. On Feb. 16, Moon Inc. announced the purchase of its first Bitcoin at a unit price of $96,150. In a statement, the company said that the purchase was financed by way of the firm’s “internal resources.” An evolving global financial landscapeThe company’s board noted the increasing popularity of cryptocurrencies in the commercial world, with particular emphasis on the use of Bitcoin as an investment portfolio asset. It believes that Bitcoin acts as a dependable store of value. It added: “The Board believes that this initial investment is symbolic in scale, and marks a significant step toward aligning with the evolving global financial landscape, and would diversify the Group’s investment portfolio and enhance its asset value.” The company’s stock rose significantly last month when details emerged of a 70% stock position in the firm, taken by UTXO Management, in collaboration with Sora Ventures and other investors. Recently appointed board member John Riggins of BTC Inc. said that this recent Bitcoin purchase by Moon Inc. “is more than a transaction.” He stated, “It’s a bold step toward creating a vision for the future of the company.”

Singapore Exchange Limited (SGX), the city-state’s primary asset exchange, is in the process of establishing Bitcoin perpetual futures trading on the platform.Photo by Kanchanara on UnsplashInstitutional product offeringAccording to a report published by Bloomberg earlier this week, the exchange platform intends to launch Bitcoin futures sometime during H2 2025. The product launch will be subject to regulatory approval from the Monetary Authority of Singapore (MAS). A spokesperson for the company told Bloomberg that the product offering will be geared exclusively towards institutional investors and traders in an effort to “significantly expand institutional market access.” Retail access to the product will be prohibited. Once launched, these Bitcoin perpetual futures contracts, being offered through a traditional finance (TradFi) outfit like SGX, will help to blur the lines between TradFi and the emerging crypto sector. Perpetual futures have no expiry date. They offer a means for traders to bet on price changes in an underlying asset while doing away with the need to take ownership of the asset itself. Cautious approachSGX has been cautious in listing crypto assets and derivative products. Last year the firm’s CEO, Loh Boon Chye, said that the time was not yet right for such listings.  His concern back then was that any such product launches would need “sustainable ecosystem support,” adding that “that means demand, that means governance, that means structure.” While spot Bitcoin exchange-traded funds (ETFs) had been approved in the United States at that point, there has been much further development in the crypto-sphere since then, following the election of a pro-crypto administration in the U.S. That event has had knock-on effects globally. Singapore’s SGX isn’t the only traditional exchange platform to respond. Japanese futures exchange, the Osaka Dojima Exchange (ODEX), is gearing up to file an application with the Financial Services Agency (FSA) to list a Bitcoin futures product later this month. Closer to home, an American digital asset marketplace that focuses on institutional trading, EDX Markets, has plans to introduce Bitcoin perpetual futures products to the Singaporean market, according to a report which emerged in January. In May 2024, EDX launched EDXM Global, a settlement platform, in Singapore. This product launch by SGX serves the purposes of decision-makers in Singapore, who have been trying to position the city-state as a digital asset industry hub. Additionally, the move will bring greater acceptance of the digital assets sector from traditional market participants. Crypto perpetual futures contracts were first pioneered by crypto derivatives exchanges like BitMEX back in 2016. Since then, other crypto-native platforms like Binance and OKX have offered these products. In the case of unregulated offshore exchanges, the products have proven to be controversial, as at times, they have been used in a manner that has exposed market participants to counterparty risk. Failed crypto exchange FTX, together with its sister company Alameda Research, relied on the products in their trading activities. SGX, as a seasoned, regulated TradFi operator, which holds an Aa2 rating from Moody’s, is likely to prove to be a more palatable option for institutional players.