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VCs Say US Crypto Crackdown Opportunity for AsiaA couple of Hong Kong-based venture capitalists told Bloomberg TV in an interview that aired on Tuesday that the current crypto crackdown in the United States is a boon for Asia and particularly for Hong Kong in establishing itself as a global crypto hub.© Pexels/lalesh aldarwishMartin Baumann, Managing Partner and Co-Founder of CMCC Global, one of Asia’s first VC funds focused purely on blockchain and crypto, said that “Hong Kong has always been a financial capital of Asia and we believe in this location.”Golden opportunityWhile the fund has a global mandate, it believes that investor focus is shifting away from North America towards Asia. Baumann’s colleague, CMCC Global Managing Partner and Co-Founder Charlie Morris said that “the US has been quite negative from the regulatory perspective and it really seems to us that the US is shooting itself in the foot with a machine gun.”Morris elaborated, stating that the US crypto crackdown is handing a golden opportunity to other world regions to lead on blockchain and crypto. Baumann chimed in to clarify that one third of all blockchain equity deals are currently being done in Asia. He maintains that most of the investment community in the West doesn’t appreciate the extent to which capital is being committed into the space by Asian entities.Morris expanded further: “We see places like Hong Kong having a real opportunity at this point in time to bring those firms and entrepreneurs to the city.”Launching $100M blockchain fundAgainst that backdrop CMCC Global is launching a $100 million fund, where funding will be allocated to blockchain projects. Specifically the duo are targeting crypto and blockchain firms at Series A and Series B funding stages. Baumann believes that in tandem with the fact that there’s a lot of innovation emerging in Asia, “there’s plenty of capital sitting on the sidelines waiting for the right entry valuations to pull the trigger.”While Baumann and Morris are majority stakeholders in CMCC Global, the Winklevoss twins (Cameron and Tyler Winklevoss) also have an equity stake in the business. Founders of the Gemini crypto exchange platform, they are investors alongside Hong Kong based Richard Li, who has a net worth estimated to be in the region of $4.6 billion.VC investment into crypto slowed down considerably since the onset of the most recent crypto winter. However, that activity has still been ongoing, something that is entirely different to the 2018 bear market when investment came to a complete standstill. In April, CMCC partnered with Switzerland-based Syz Group with the objective of establishing a funding vehicle with a minimum $50 million fund earmarked for crypto-centric hedge fund investment.Meanwhile, in speculating on the prospects of bitcoin, the CMCC duo expressed the view that double digit gains are well within reach. Morris envisages a Bitcoin unit price of $40,000 in 2023. From a long term perspective the CMCC co-founder suggested that “I can easily see us breaking all time highs and easily breaking $100,000 for bitcoin.”

Taiwan police uncover $320M crypto money laundering operationTaiwan police have recently exposed the largest cryptocurrency money laundering case in the nation’s history, involving 320 million USDT (approximately 10.5 billion New Taiwan dollars).Photo by DrawKit Illustrations on UnsplashCross-border laundering operationIt emerged on Tuesday that the Electronic Investigation Team of the Criminal Bureau initiated their probe after uncovering a fraudulent scheme related to a counterfeit Taishin Securities mobile software last year. This led them to a merchant with the surname Qiu, the alleged mastermind behind this operation who was suspected of laundering substantial sums through virtual currency.Qiu is believed to have maintained connections with overseas gambling and fraud groups, engaging in cross-border communication with illicit organizations in countries including Hong Kong, Malaysia and the Philippines.Their investigation revealed that Qiu had been conducting transactions involving 320 million Tether US dollar stablecoins since February of the previous year. In June, law enforcement apprehended Qiu during one of his visits to Taiwan, along with four alleged accomplices.High value goodsDuring the operation, authorities seized high-value assets from Qiu, including a Lamborghini Urus, a Lexus LM and three Audemars Piguet watches, with a combined market value exceeding TWD 13 million. The lavish lifestyle maintained by Qiu, evident from his luxury cars and high-end watches, serves as a stark reminder of the extensive underground economy driven by money laundering.Evidence from the operation suggested Qiu’s involvement in handling illicitly obtained Tether coins worth approximately TWD 70 million. Further investigations uncovered that Qiu regularly sold virtual currency and converted it into cash to effectively obscure the money’s origins, accomplishing the goal of laundering.In piecing the activities of the group together, police determined that victims were instructed to transfer their funds to fictitious accounts. In that way, the money found its way to crypto exchanges and individual crypto traders under the direction and control of the group.Qiu would also retain a 1% profit margin from the laundered amount. Several other individuals were implicated in this extensive operation, including a foreign affairs officer named Liao and two other individuals named Chen and Huang. Each of these individuals is presently under investigation, with varying levels of bail and restrictions imposed.The intricate web of transactions and the substantial amount laundered by Qiu have surpassed previous records held by the Electronic Investigation Team. As investigations continue, law enforcement is determined to uncover the full extent of this operation and trace the entirety of the money flow.Taiwan’s legislators are currently working on producing a regulatory framework for crypto in the country. The only regulatory aspect that is covered right now is oversight relative to anti-money laundering (AML) and know-your-customer (KYC) regulation. In 2018 Yang Chin-long, Taiwan’s central bank Governor, called for a need to regulate crypto on the basis of existing AML rules, with the authorities subsequently following through on that measure.In July 2022, the country’s Financial Supervisory Commission (FSC) penned a letter to the banking sector, banning the purchase of digital assets via credit cards.

Malaysia Ushering in Fifth Digital Asset ExchangeKuala Lumpur-headquartered crypto platform Hata has become the latest entrant in the local digital asset exchange (DAX) business, securing licensing and regulation from the Securities Commission Malaysia (SC).The brainchild of David Low, former Asia Pacific General Manager at Luno, Hata Digital Sdn Bhd, is now the recipient of conditional approval from the SC, enabling it to facilitate cryptocurrency trading once it fulfills the regulator’s stipulated requirements over the next six to nine months. The firm now joins Luno Malaysia, MX Global, Sinegy DAX, and Tokenize Technology to become the fifth regulated DAX to trade within the Southeast Asian country.Photo by Esmonde Yong on UnsplashFirst digital brokerOne interesting aspect of Hata’s approval is that it also marks the first DAX to receive digital broker status from the SC. This unique status allows Hata to display trade orders from other exchanges on its website or mobile application, giving users access to a broader spectrum of trading opportunities.Hata can match its users’ trades with those available on other exchanges or provide them with cryptocurrency prices from these exchanges. However, it is essential that the exchanges Hata collaborates with are licensed by authorities in “competent jurisdictions,” such as the Monetary Authority of Singapore (MAS), and gain approval from the SC.Low shared his vision, stating:“With the goal of challenging the existing norms, we plan to make digital assets investing easier for institutional investors, businesses, and high-net-worth individuals in Malaysia. And we look forward to launching the platform soon.”Luno competitorLow’s departure from Luno adds an intriguing dynamic to Malaysia’s digital asset industry, given his pivotal role in expanding Luno’s presence in Malaysia and Southeast Asia. At the time of his departure, Luno was widely acknowledged to have commanded over 90% of the local cryptocurrency trading market share, with some estimating it as high as 98%.Low is now stepping into the realm of competition with his former colleagues and company, where he had previously invested significant effort and resources to foster growth.Hata boasts two other Co-Founders, Darien Ng, Chief Revenue Officer, and Chong Kwai Kun, Chief Technology Officer, both with extensive expertise in blockchain technology and software development in Malaysia since 2018.Low stated that the “SC’s decision to grant us conditional approval to operate a DAX represents a vote of confidence in us and the digital asset industry. This is a significant milestone for my team and I at Hata, after months of extensive efforts.”One-stop crypto platformHe continued: “Hata wants to enable safe and effortless cryptocurrency access and we look forward to being a one-stop and reliable platform for our customers, with our suite of products and services.”Low emphasized their goal of challenging existing norms, making digital asset investing more accessible to institutional investors, businesses, and high-net-worth individuals in Malaysia.The exchange’s founder also commended the SC’s efforts in expanding the regulated market operator framework to allow DAXs to operate as digital brokers. In addition, Hata has obtained a money broker license from the Labuan Financial Services Authority, reinforcing its efforts to operate as a compliant and secure platform.