OPNX Confirms Significant VC Backing

The Shanghai office of a Chinese regulatory body which oversees assets belonging to state-owned enterprises (SOEs) is reported to have held a session dedicated to the topic of digital assets and in particular, stablecoins, fueling speculation of a positive shift in outlook on crypto in China.Photo by Hanny Naibaho on UnsplashOn July 11, Reuters reported that the State-owned Assets Supervision and Administration Commission (SASAC) held the meeting in Shanghai on July 10, with the publication suggesting that the event represented “a marked shift in tone” in the consideration of digital assets in China, bearing in mind that crypto trading and mining are banned within the country. Following the “development trend and response strategies” study session, He Qing, director of the organization, said that there was a need for "greater sensitivity to emerging technologies and enhanced research into digital currencies." The regulator called on Chinese state-backed agencies to consider the adoption of blockchain technology for use cases like real-world asset (RWA) tokenization, supply chain finance and cross-border trade. A policy expert from Shanghai-headquartered securities firm, Guotai Haitong Securities, attended the meeting, outlining details on the history, characteristics and categories of cryptocurrencies and stablecoins, while also discussing global regulatory frameworks. Last month, a subsidiary company of Guotai Haitong Securities, Guotai Junan International (GTJAI), became the first company from the Chinese mainland to be given approval by the Hong Kong securities regulator to offer digital asset trading services. Adapting to the stablecoin trendIn June, state-owned financial newspaper, Securities Times, called on Beijing to adapt “to the trend of stablecoins.” The publication claimed that industry insiders “generally believe that, as an emerging payment tool, the unique advantages and potential risks of stablecoins cannot be ignored, and that the development of [yuan-backed] stablecoins should be sooner rather than later”. The same month, Pan Gongsheng, governor of the People’s Bank of China, acknowledged that stablecoins are playing a role in disrupting global payments infrastructure.  It also emerged recently that JD.com, a Chinese e-commerce giant, and Ant Group, an affiliate company of the Alibaba Group, have been lobbying the Chinese authorities for the authorization of yuan-based stablecoins. On X, Shanghai Macro Strategist, a China strategist, claimed that the recent surge in the Bitcoin unit price had come about as a consequence of this stablecoin-focused SASAC meeting in Shanghai. At the time of writing, BTC has appreciated 9.3% over the course of the past seven days. The strategist suggests that the event is fueling speculation that “the Chinese government may be in the early stages of reassessing its official stance on the crypto industry.” In their monthly report for May, the strategist pointed out that “Beijing’s outright rejection of [Bitcoin] as a legitimate asset” was holding the leading asset back on its path to “reserve status.” The strategist added: “Over the longer term, a shift in China’s stance could prove to be the single most powerful bullish catalyst—elevating Bitcoin from a fringe asset to a globally recognized store of value.”

Korean regulator monitors non-listed token amidst peer-to-peer trading surgeThe South Korean financial regulator is closely monitoring BTCMobick, a non-listed token issued by crypto influencer Oh Tae-min, who is known for authoring books like “The Great Bitcoin” and “Bitcoin and the Geopolitics of the Dollar.” The Financial Services Commission (FSC) is cautioning local crypto exchanges regarding the potential for price manipulation should the token be listed.Photo by Daniel Bernard on UnsplashBTCMobick TokenThe BTCMobick token is reportedly being traded peer-to-peer at around KRW 300,000, which is approximately equivalent to $230, in chat rooms of messaging apps like KakaoTalk outside of cryptocurrency exchanges. The token has gained enough traction to spur the emergence of dedicated apps that facilitate these peer-to-peer trades, charging fees for their services. Based on the size of the chat rooms and apps involved, it is estimated that approximately 3,000 participants are trading the token, according to a report by local news website Etoday.As per another coverage by the same outlet, the Virtual Asset Inspection Division of the Financial Intelligence Unit (FIU), which operates under the FSC, has inquired with local crypto exchanges on two occasions — once in September and again this week — about whether they have listed or are planning to list the BTCMobick token. It’s rare for the financial authority to specifically target a particular token when making inquiries with crypto trading platforms.Potential price manipulationAn FIU official explained the rationale behind the agency’s inquiry into crypto exchanges. The official stated that the probe aimed to caution the exchanges about potential price manipulation of the BTCMobick token. The concern is that many crypto users might suffer losses if such a token, which has been experiencing a continual rise in price outside of trading platforms, were to be listed. Currently, legal penalties for cryptocurrency price manipulation fall under the Virtual Asset User Protection Act, which will not be enforced until July 2024. This indicates a regulatory gap in the immediate term.Hwang Suk-jin, a professor at Dongguk University’s Graduate School of International Affairs and Information Security, pointed out that while giving out privately generated tokens to friends or acquaintances doesn’t raise any legal issues, the situation changes once these tokens are listed for trading on exchanges and distributed more broadly in the market. In such scenarios, these tokens can become a source of legal disputes, he explained.Amidst these developments, there are circulating rumors suggesting that BTCMobick is on the verge of being listed on exchanges. An industry insider has mentioned that there are brokers actively spreading these rumors, indicating that the token might soon become publicly tradable.Oh Tae-min’s denial of rumorsMeanwhile, Oh Tae-min, the creator of BTCMobick who has been distributing his token for free, states that the token is part of an experiment intended to mimic the early stages of Bitcoin. However, critics are concerned that the personally issued token has no practical utility. Addressing the circulating rumors about the token’s potential listing on exchanges, Oh asserts that these rumors are baseless and false. He further warns that any brokers spreading such rumors are likely engaging in fraudulent activities.

Korean Financial Authorities to Provide Support for Security Token MarketAmid growing calls for accelerating the growth of the emerging security token (ST) market, the South Korean government is preparing to introduce supportive measures. The security token market is powered by blockchain technology which allows fractional investment in real world assets (RWAs) such as real estate and artwork.Security tokens are digital assets that represent securities generated through a process called security token offering (STO). These tokens, backed by RWAs, can be traded similarly to traditional securities. Investors can use these tokens to obtain shares, voting rights, interest, or profits.Photo by Philip Jang on UnsplashSupport measures for security token IndustryNext month, the Financial Services Commission (FSC) will draw up support measures and policy improvement plans to bolster the nascent security token industry. An FSC representative mentioned that the agency intends to work with the National Assembly to finalize the legislation of security token-related bills by November. Furthermore, the government official said the FSC will actively seek input from industry stakeholders to formulate strategies for enhancing policies designed to promote the growth of the security token market.To align with the national objective titled “The Establishment of Digital Asset Infrastructure and Regulatory Framework,” the FSC revealed regulatory guidelines for security token issuance and distribution in February. These new guidelines are centered around the establishment of institutions responsible for account management and entities engaged in over-the-counter (OTC) trading. Subsequently, in July, lawmaker Yun Chang-hyun, a member of the National Assembly’s National Policy Committee, proposed a bill to amend the Electronic Securities Act and the Capital Markets Act with the aim of ensuring that these Acts are consistent with the new regulatory guidelines.Security token market’s growth potentialWith growing anticipation that the security token market could rival the size of the exchange-traded fund (ETF) stock market, securities firms, banks, and blockchain companies have been eager to carve out a niche for themselves since the start of the year. However, their progress has been hindered by a potentially extended period of higher interest rates in the US and the slow advancement of security token-related legislation. While these organizations tried to explore opportunities through the financial regulatory sandbox, their endeavors proved more or less fruitless. An official from a securities firm voiced concerns over the escalating costs of setting up security token infrastructure, especially with legislative delays.On this matter, the Korea Financial Investment Association (KOFIA) has emphasized the urgent need to pass security token legislation to clear up regulatory ambiguities. They’ve also called for measures to stimulate market growth, such as relaxing regulations related to token issuance and distribution and increasing investment caps.At a seminar hosted by the Korea Capital Market Institute, Ahn Hyuk, Head of the Platform Division at Korea Investment and Securities, highlighted that the rigorous review of security registration applications by the Financial Supervisory Service (FSS) might impede the security token market’s growth. Responding to this, Jang Young-shim, Head of the Corporate Disclosure Department at FSS, said that both the FSC and FSS will carefully listen to industry feedback, addressing a range of topics from regulatory relaxation to investor protection.