SEC Lawsuit Stalls Binance’s Gopax Acquisition Deal in South Korea

Bitget Achieves 20M Users With Wallet Integration Driving Trading VolumeSeychelles-based cryptocurrency derivatives exchange, Bitget, has experienced remarkable growth in the first half of 2023 surpassing 20 million users, driven by the successful integration of its recently acquired self-custodial wallet service, now renamed Bitget Wallet.Photo by Mike Hindle on UnsplashTop four exchangeThe wallet integration has propelled Bitget into the ranks of the four largest cryptocurrency exchanges by trading volume.According to a second-quarter report by Beijing-headquartered crypto research firm TokenInsight, the top four exchanges collectively account for 85% of the total market trading volume. Binance dominates the market with a 52% share, followed by OKX (15.13%), Bybit (10.6%), and Bitget (8.1%), securing its position among the industry’s leading players.$60 billion spot trading volumeBitget’s Q2 report, released on July 18, revealed that the platform’s spot trading volume surpassed $60 billion, with futures trading reaching a staggering $606 billion. Notably, research by blockchain analytics firm Nansen showcased Bitget as the only exchange to witness an increase in futures trading volumes in the six months following the collapse of FTX.The exchange attributes part of its impressive Q2 performance to the introduction of copy trading, a feature enabling users to emulate the trading strategies of select traders. This innovation proved highly successful, attracting 29,700 new elite traders and 169,800 followers, generating $33 million in profits by mid-2023.Bitget, aligning with leading exchanges like Binance, has released its proof-of-reserves to assure users that it maintains reserves exceeding 100% of all assets on the platform, including Bitcoin (BTC), Ether, Tether, and USD Coin. At the time of publication, the exchange’s current reserve ratio, calculated by dividing the platform’s assets by users’ assets, stood at an impressive 223%. According to that data, the crypto platform is claiming a debt-free status for the business.Regional expansionAs part of its expansion strategy, Bitget has obtained virtual asset service provider registration in Poland and Lithuania in 2023, solidifying its presence in Europe. Additionally, the exchange has announced plans to establish a hub for its operations in that region.Last week, it announced that it was also targeting the Middle East and North Africa (MENA) as part of its expansion plans. To support that effort, it has opened an office in Dubai in the United Arab Emirates (UAE) and hired 60 employees with plans on hiring up to 60 more over the course of the next two years.Crypto loans have been an area that has seen major failures within the sector over the last couple of years. However, this isn’t holding Bitget back from getting involved. Earlier this month, it announced the launch of its crypto loans product, which is aimed at market participants who are seeking alternative funding solutions, backed by digital assets.With Bitget’s rebranding efforts following the BitKeep acquisition and its exceptional growth in user numbers and trading volumes, the exchange is making a concerted effort to position itself so as to effect a global expansion strategy. As the market evolves further, it will be interesting to see how the crypto trading market settles, given that there are now a number of firms in the space actively vying for that business.

As Hong Kong approaches the culmination of the Securities and Futures Commission's (SFC) deadline for cryptocurrency exchanges to seek licenses, the regulator issued a reminder to investors about the potential risks associated with trading on unlicensed platforms.Photo by Jarrod Erbe on UnsplashUrging cautionIn a notice released on Monday, the SFC emphasized the importance of engaging exclusively with SFC-licensed virtual asset trading platforms (VATPs) to ensure investor protection. With only one month remaining for exchanges to apply for a license under the city's virtual asset regulation, the SFC urged investors to exercise caution when dealing with platforms that have not yet received approval.The SFC suggested that investors check the list of regulated platforms, which it maintains on its website. Within the notice, the regulator outlined that in the past, some platforms have claimed to be regulated entities when they were not compliant platforms and not adhering to existing regulations within the Chinese autonomous territory. The advisory comes after the fallout from a high-profile fraud incident involving the JPEX trading platform last fall, resulting in substantial losses of $192 million. Growing list of VATP license applicantsLast month, four additional crypto exchanges, including the KuCoin-affiliated HKVAEX and Singapore-based Bybit, joined the list of official VATP license applicants. The SFC began publishing this list in response to the JPEX scandal, underscoring the importance of regulatory compliance in the cryptocurrency sector. Hong Kong's virtual asset regulation, enacted as an amendment to the Anti-Money Laundering and Counter-Terrorist Financing Ordinance last year, stipulates that companies engaged in selling or marketing cryptocurrencies to Hong Kong residents must apply for a license by Feb. 29. Those failing to do so must cease business operations in the city by May 31. Currently, OSL and HashKey are the only licensed exchanges in Hong Kong, having received an earlier voluntary license that was later upgraded to include retail investors. These exchanges are operating under an interim solution permitted by the SFC, allowing retail investors to trade on their platforms. Setting a high barWhile 14 companies have formally submitted license applications to date, Patricia Ho, General Counsel for blockchain company Scroll, told the South China Morning Post (SCMP) that the stringent requirements set by Hong Kong have led to a selective process. Ho explained that the city has intentionally set a high bar for application submission, resulting in only the most committed and resourceful entities progressing to the application stage. Last month, it emerged that the SFC had acted to bolster investor protection by introducing a minimum insurance requirement of 50% for licensed crypto exchanges that handle customer funds. It is also planning to introduce a regulatory framework relative to crypto over-the-counter (OTC) trading desks. The SFC is also monitoring individual crypto projects, as last week, the regulator issued a stern warning to those behind the offering of the Floki and TokenFi staking programs. As the deadline approaches, Ho anticipates potential enforcement actions against smaller platforms operating in legal gray areas. Larger platforms, on the other hand, have already begun restricting access from Hong Kong. 

Binance Expands Crypto Offering in Dubai with New LicenseDubai has welcomed one of the biggest players in the crypto sector, Binance, with the Virtual Asset Regulatory Authority (VARA) awarding the firm a new trading license.Photo by Petar Avramoski on UnsplashServing qualified investorsAccording to an announcement made by the company on Monday, Binance’s Dubai-based subsidiary, Binance FZE, has secured the operational Minimum Viable Product (MVP) license from VARA.Eligible investors in Dubai, deemed as “qualified retail clients,” will now have access to authorized services such as compliant crypto-to-fiat exchanges, adhering to the guidelines set by the Financial Action Task Force (FATF). To qualify, investors must meet specific criteria, including being at least 21 years old and possessing a minimum of 500,000 United Arab Emirates dirhams ($136,000) in net liquid assets, supported by relevant documentary proof like bank statements and proof of funds.Additionally, qualified investors are required to provide valid identification documents, including passports and visas, along with proof of a valid UAE address and contact details. This comprehensive verification process ensures compliance with regulatory requirements and enhances security measures for all parties involved.Expanded service offeringThe move is a significant development as it allows Binance to offer cryptocurrency exchange and virtual asset broker-dealer services to institutional and qualified retail investors in Dubai.With the new license, Binance’s Dubai entity can now offer crypto-to-fiat exchange, conversions, transfer and custody solutions, brokerage facilities, as well as virtual asset payments and remittance services. The development builds upon Binance’s previous progress, having received the provisional MVP license in March 2022, followed by the preparatory MVP license in September 2022.Licensing challengesIt’s worth noting that some crypto exchanges have faced challenges operating with preparatory MVP licenses due to limited capabilities, only serving a restricted set of accredited investors. Bybit CEO Ben Zhou had previously highlighted this concern. That said, Zhou still came to the conclusion recently that the regulatory approach in the UAE is superior by comparison with many other jurisdictions.The news of Binance’s successful licensing comes shortly after VARA suspended the operational license of another crypto exchange, BitOasis, for not meeting required conditions within the set timeframes. BitOasis assured its commitment to fulfilling the remaining conditions in collaboration with VARA.In April 2023, VARA sought additional information from Binance, aiming to tighten regulatory standards in the emirate. Binance promptly provided all requested information and looked forward to further collaboration with VARA as it prepared for the next phase of licensing.Compliance with VARA’s framework includes adherence to compulsory rulebooks related to general operations, compliance, and market conduct requirements. The regulator has published key highlights of the regulations in 2023, underscoring its efforts to create a robust and well-regulated crypto market in Dubai.Regulatory headwindsBinance’s latest regulatory achievement indicates the exchange’s dedication to expanding its services and offerings in the region. It could potentially lead to something even more significant for the company in the Middle East as Binance has suggested that it would be more likely to expand in places such as Dubai, given an adverse regulatory approach elsewhere.Over the course of the past three months, the company has been forced out of key markets such as Germany, Canada, Belgium, the Netherlands, and Cyprus, due to regulatory pushback.