China to outline clear directions for NFT & Web3 development

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.

Cross Trading of LUNA Tokens Uncovered on Three Korean Crypto ExchangesAccording to a report by the Maeil Business Newspaper on Wednesday, it was discovered that cross trading of LUNA tokens took place on three South Korean cryptocurrency exchanges: Bithumb, Coinone, and GoPax.Three crypto exchangesAn indictment by the Seoul Southern District Prosecutors’ Office against Terraform Labs co-founders Do Kwon and Daniel Shin, along with interviews conducted within the cryptocurrency industry, revealed that Bithumb, Coinone, and GoPax were involved in cross trading LUNA tokens with a combined value of $598 million. Specifically, Bithumb accounted for $224 million, Coinone for $299 billion, and GoPax for $74 billion.The prosecution has confirmed that cross trading continued until the end of February 2022, a period marked by significant demands for virtual asset legislation from both the market and academia. Despite widespread calls for regulations to curb unfair trading practices, these instances of cross trading went undetected.Classification of LUNAMoreover, it is reported that legal punishment for the $598 million worth of cross trading is challenging unless LUNA tokens are officially recognized as securities by the court. Under the Korean Capital Markets Act, only cross trading involving tokens identified as securities can be subject to penalties as a form of market manipulation.During a plenary session of the National Assembly’s Legislation and Judiciary Committee on Tuesday, Justice Minister Han Dong-hoon made a statement suggesting that LUNA tokens could be considered securities due to their backing by real-world assets. However, he said that this distinction might not apply to other tokens.On April 25, the Seoul Southern District Prosecutors’ Office indicted Shin and others as accomplices to Kwon, assuming that LUNA tokens were indeed securities. This case now revolves around whether the prosecution can successfully establish the classification of LUNA tokens as securities during the trial, making it the central issue in the case.Photo by Kanchanara on UnsplashCrypto investor protection legislationLast Thursday, the National Assembly’s National Policy Committee approved a bill known as the “Virtual Assets User Protection Act,” signaling an accelerated legislative process. However, there are arguments suggesting that the definition of cross trading should be further clarified in either the legislation or enforcement decree.A representative of a law firm specializing in virtual assets stated that the implementation of the User Protection Act would take another year even after its promulgation, making it challenging to retrospectively penalize cross trading practices that had already occurred.

South Korea’s neobank Kbank has partnered with BPMG, a domestic Web3 developer, to pursue stablecoin initiatives abroad, the Electronic Times reported. The companies are preparing proof-of-concept (POC) trials with firms in Thailand and Dubai as part of a broader push to participate in global financial infrastructure. Following a recent agreement with Kbank, BPMG has begun collaborating with a Thai company on a stablecoin project and is working with an investor in the United Arab Emirates (UAE) on the issuance and operation of stablecoins. Kbank plans to leverage BPMG’s blockchain technology to develop stablecoin business models for remittances, currency exchange and payments, and to support the build-out of related systems. The bank is focusing first on Asia and the Middle East.Photo by Shubham Dhage on UnsplashReducing intermediaries and automating regulatory complianceAnother priority is cutting intermediaries in cross-border transfers to speed up remittances and reduce costs via distributed ledger technology. Drawing on BPMG’s patents in AI and blockchain, Kbank is also developing a tool to automate regulatory analysis across jurisdictions so it can tailor services to local rules. As digital transformation accelerates, stablecoins are gaining traction as a payment method for their low volatility and ability to enable real-time cross-border transactions. In April, Kbank joined the Pax Project, a stablecoin initiative backed by Japan’s three major banks—Mitsubishi UFJ Financial Group (MUFG), Sumitomo Mitsui Banking Corporation (SMBC), and Mizuho. Through the project, Kbank is participating in trials for real-time transfers and settlement between South Korea and Japan. The bank has also formed a digital asset task force to advance the commercialization of stablecoin solutions. A Kbank official said combining blockchain with finance can deliver faster, more efficient global services and that the BPMG partnership is expected to demonstrate the practical utility of stablecoins, paving the way for integration into both domestic and international offerings. IPO timing hinges on Upbit renewalThe stablecoin push comes as Kbank is widely expected to submit a preliminary initial public offering (IPO) filing as early as this month, with a listing anticipated in October. A key variable, according to market watchers, is whether Kbank renews its contract with Upbit, South Korea’s largest cryptocurrency exchange, to provide real-name bank accounts—a regulatory requirement for fiat-to-crypto platforms. Kbank has been Upbit’s banking partner for five years, and deposits from the exchange account for roughly 20% of the bank’s total. Kbank is also seeing rising corporate activity around digital assets. As of Aug. 18, the bank had more than 100 corporate accounts dedicated to crypto trading—over double the 49 recorded at the end of last year—momentum widely attributed to its partnership with Upbit. Since launching corporate-focused services in late 2023, Kbank has provided real-name accounts to entities including government bodies, non-profits, and local municipalities. The uptick follows the financial regulator’s earlier decision to allow non-profits and trading platforms to sell crypto holdings, with implementation beginning in June.