Eggverse and SPLabs team up to venture into Southeast Asian Web3 market

Wemade joins hands with DIFC to establish WEMIX Play Center in DubaiSouth Korean blockchain gaming publisher Wemade has become the first gaming company in the country to form a partnership with the Dubai International Financial Centre’s (DIFC) Innovation Hub, according to an official press release on Wednesday (local time). Through this new partnership, Wemade plans to establish a WEMIX Play Center at the DIFC Innovation Hub as a space for gaming companies that are part of the WEMIX ecosystem.Photo by Wael Hneini on UnsplashUnlocking opportunitiesThe DIFC is a financial free zone in Dubai equipped with its own administrative, judicial and regulatory bodies. The Innovation Hub — a financial innovation ecosystem — was established by the Dubai government to attract global companies in fintech, Web3, gaming and artificial intelligence (AI). Members and partners are eligible to receive various benefits, like a DIFC Innovation Licence — which helps technology firms set up their businesses — global networking opportunities and office spaces.Along with the establishment of the WEMIX Play Center, Wemade aims to make appropriate investments for the success of its onboarded companies and work with the DIFC to create a $100 million global Web3 gaming fund. The company said that it would hold joint Web3 events with the Innovation Hub in the future to promote these initiatives.Fostering financial evolutionDubai has been actively promoting financial services to stimulate economic growth and attract investments, encouraging the creation and growth of blockchain businesses and the widespread use of cryptocurrencies. By settling down at the DIFC Innovation Hub, Wemade intends to closely communicate with UAE’s crypto regulatory authorities and formulate an optimal business strategy in line with the latest industry trends in the Middle Eastern region.Meanwhile, the company is in the process of applying for the registration of its governance token WEMIX as a recognized crypto token with the Dubai Financial Services Authority (DFSA). Cryptocurrencies on this DFSA list are authorized for use in transactions among the 4,900 institutions and individual investors residing in DIFC. Currently, there are five recognized crypto tokens including Bitcoin, Ethereum, Litecoin, Ripple and Toncoin. The latter two were recently added to the list last month.

HKX management has advised Hong Kong resident users of the platform to withdraw assets following the company’s decision to halt operations in Hong Kong.  The company publicized its decision on July 18, making the following statement on its website: “We would like to inform you that our management team has, after careful consideration, decided to withdraw our application for the Type 1 and Type 7 licenses under the Securities and Futures Ordinance (Cap. 571) and the virtual asset service provider license under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (Cap. 615).”Photo by Zhe ZHANG on UnsplashCompliance strugglesHKX’s exit from Hong Kong is the latest in a series of crypto exchange withdrawals from the Chinese autonomous territory. Other exchanges such as OKX, KuCoin, Gate.io and Binance had all bowed out back in May.  HKX initially applied for a Hong Kong license in February. However, like many others, the exchange failed to comply with Hong Kong’s regulatory requirements. While Hong Kong has been making a concerted effort to establish a regulatory framework and licensing system in order to create the conditions for it to become a crypto hub, it has also been grappling with making regulations strict enough to stamp out fraud in the wake of the JPEX exchange scandal. With that, it appears that many exchanges are finding the regulatory requirements difficult to live with. Originally, 24 exchanges had applied for a virtual asset trading platform (VATP) license. As it stands today, 12 of those original applicants have dropped out, with one more having its application returned with no clarity emerging as to the reason why. HKX has suspended new user registrations. The company’s management has not suggested that they will reapply for a license and reboot the service at a later stage. The company had flagged its intentions back in May, suspending trading and deposit services on May 29. OKX announced on May 24 that it was withdrawing from the Hong Kong market, citing a review of its business strategy. Around the same timeframe, Gate.io withdrew from the market in Hong Kong having failed to achieve compliance in accordance with the new licensing requirements.  Notwithstanding that outcome, the firm suggested that it planned to revamp its platform in line with the Chinese autonomous territory’s licensing requirements, and return to the market once that had been achieved. In a notice posted to its website on May 22, it stated: “Gate.HK is actively working on the aforementioned overhaul. We plan to resume our business in Hong Kong in the future and contribute to the virtual asset ecosystem after obtaining the relevant licenses.” That overhaul has yet to be completed as right now, the platform only allows the withdrawal of funds by its previous Hong Kong-based customers. Back in May 2023, Eddie Yue, the CEO of the Hong Kong Monetary Authority, suggested that there would be no light touch regulation in Hong Kong. HashKey Exchange, alongside OSL, was the first business to secure licensing under the new framework. In April, HasKey CEO Livio Weng told the Financial Times that these regulations block access to overseas investors while the local market in Hong Kong isn’t very big. It emerged in recent weeks that Hong Kong regulators are reviewing whether crypto regulation is “excessively stringent.” 

CityLabs Secures 8.55% Stake in GopaxCityLabs, a company listed on the KOSDAQ stock exchange, has stepped in as a rescue investor for the South Korean cryptocurrency exchange Gopax.The company announced last Friday that it has acquired a total of 76,308 shares of Streami, the operator of Gopax, securing an 8.55% stake in the company. The investment amounts to a total value of KRW 5.4 billion (approximately $4 million).Photo by Precondo CA on UnsplashGopax’s turbulent historyGopax has recently been facing public and regulatory scrutiny due to its internal struggles, such as undergoing major changes in leadership earlier this year following its acquisition by Binance, with Lee Jun-haeng resigning and Binance’s Asia Pacific Head, Leon Sing Foong, taking over.After this event, Streami submitted reports to the Financial Intelligence Unit (FIU) under the Financial Services Commission (FSS) in line with requirements to inform the regulatory body about such changes. However, due to delays in the FIU’s approval process likely influenced by Binance’s various legal and regulatory challenges, there was yet another leadership transition — Foong stepped down, and Lee Joong-hoon, Gopax’s former Vice President, took over. Notably, Foong recently left Binance altogether amid regulatory crackdowns.During this process, Gopax also struggled to make principal and interest payments on its own decentralized finance (DeFi) service, GOFi, in the wake of last year’s FTX collapse. The amount of customer funds locked in GOFi totals KRW 56.6 billion, according to an announcement made by Gopax in April. Binance acquired a stake in Gopax on the condition that it would inject enough capital into Gopax to repay this amount in full.CityLabs steps inAs a result, there have been speculations that a Korean company would invest in Gopax and deliver the exchange from its woes. Some even predicted that this company might become a major shareholder, although CityLabs has acquired only an 8.55% stake due to the fact that the funds required to do so far exceed CityLabs’ annual revenue.Last year, CityLabs reported a consolidated revenue of KRW 28.4 billion and an operating loss of KRW 6.1 billion. Although its revenue increased by 2% compared to the previous year, operating losses grew by 46.9%. While the company may not have sufficient funds at present to become a major shareholder, there lies the possibility that it may increase its stake in the future.The acquisition seems to be driven by CityLabs’ interest in blockchain businesses and the crypto market. While it currently specializes in intelligent transportation systems (ITS), it was formerly Dayli Blockchain, which was affiliated with the crypto exchange Coinone and Dayli Financial Group (now known as Gowid). In 2017, Yellow Mobile became the largest shareholder of Dayli Financial, and in February 2018, it became the largest shareholder of DailyBlockchain, making Dayli Blockchain its subsidiary. Coinone was also a subsidiary of Yellow Mobile at the time. All of these ownership relations have now been restructured.CityLabs has thus been involved in the blockchain industry for some time now with previous connections to cryptocurrency exchanges while also offering decentralized identity (DID) and blockchain as a service (BaaS) products. Observations point to the possibility that its history has influenced its decision to invest in Gopax.“We acquired shares to secure an entry point into the crypto market and position ourselves as a major player,” the company said in a statement.Meanwhile, financial authorities are considering plans to examine the eligibility of major shareholders when reviewing applications from crypto businesses.