Standard Chartered joins China’s CBDC pilot trials

South Korea is tightening its grip on the cryptocurrency sector, with courts handing down the first prison sentence under an investor protection law enacted last year. The ruling comes just as financial authorities signal a comprehensive overhaul of digital asset governance, ranging from ownership caps to the tokenization of real-world assets. The Seoul Southern District Court sentenced the head of a crypto management firm to three years in prison for manipulating virtual asset prices and amassing roughly 7 billion won in illegal profits, according to Yonhap News Agency. The court also imposed a fine of 500 million won ($340,000) and ordered the forfeiture of approximately 846 million won ($580,000). Photo by Daniel Bernard on UnsplashFirst sentence under 2024 protection lawThis marks the first conviction under the new investor protection law, which took effect in July 2024. It was also the first case fast-tracked directly from the Financial Supervisory Service (FSC) to prosecutors under the new legal framework. The conviction coincides with a broader regulatory debate involving Financial Services Commission (FSC) Chairman Lee Eog-weon. According to MoneyToday, in testimony before the National Assembly’s National Policy Committee on Feb. 5, Lee outlined an agenda covering anti-money laundering (AML) enforcement, stablecoin regulation, and digital innovation. However, he cautioned lawmakers against enacting blunt, one-size-fits-all rules that could stifle competition. Ownership cap rules trigger debateLee pushed back against a proposal to cap major shareholder stakes at 15%, pointing out that the exchange market is already a monopoly where smaller players hold less than 3% combined. He warned lawmakers that forcing firms with negligible market share to dilute ownership would effectively choke off investment. He argued that such restrictions would stifle innovation, advocating instead for a tiered regulatory approach that accounts for new entrants starting with no market share. Lee also addressed a separate policy direction that would recognize bank-led consortia—in which banks hold more than 50% plus one share—as eligible stablecoin issuers. He said the approach was not intended to favor any particular corner of the financial industry. On the enforcement side, the commission announced plans to strengthen its response to cross-border crime and money laundering involving digital assets, as reported by Digital Asset. A key measure under consideration is the expansion of the travel rule, which requires exchanges to share sender and recipient information for transactions. The rule currently applies to transfers of 1 million won ($680) or more, and regulators want to extend it to smaller transactions as well. The commission also pledged to support AI-driven transformation across the financial sector and to build a comprehensive regulatory framework for digital assets. STOs near legalizationIn a related development, South Korea has cleared a major legislative hurdle for the tokenization of real-world assets (RWAs). Amendments to the Capital Markets Act and the Electronic Securities Act passed the National Assembly last month, roughly three years after financial authorities first issued guidelines on security token offerings (STOs), according to another Digital Asset report. The legislation allows securities to be digitized on blockchain-based distributed ledgers and creates a new class of issuer account management institutions, enabling qualified companies to issue and manage security tokens directly. The bill now requires only Cabinet approval and official promulgation before it takes effect.

Korea and Japan Collaborate to Develop Accounting Standards for Virtual AssetsThe Korea Accounting Institute (KAI) announced today that it held a bilateral meeting yesterday with the Japanese Financial Accounting Standards Foundation (FASF) to discuss devising accounting standards for virtual assets. Among the attendees were high-level officials of the FASF, including Yasunobu Kawanishi, Chair of the Accounting Standards Board of Japan.Photo by Shubham’s Web3 on UnsplashConsensus on establishing standardsBoth parties agreed on the importance of establishing accounting standards for virtual assets. These standards should be practical and easy to follow, ensuring that they offer sufficient information to readers of financial statements.Reciprocal sharing of progressKAI is in the process of revising the Korean version of the International Financial Reporting Standards (K-IFRS) to require companies to disclose information related to virtual assets within the annotations of their financial statements. This mandatory disclosure of virtual asset-related details was announced by the Korean Financial Services Commission last month, with implementation scheduled for January of next year. This significant update was a topic of discussion in the meeting. Similarly, the FASF reciprocated by sharing its own progress and advancements.This meeting was arranged in light of the deepening relations between the two nations. The close collaboration between the two groups is poised to give Korea momentum to broaden its global presence. Moving forward, the accounting bodies of both countries are committed to continuing their cooperative efforts.

Abu Dhabi Global Market (ADGM), an international finance center and free zone, and Solana Foundation have forged a collaboration aimed at advancing the development of blockchain ecosystems. Nurturing DLT innovationThe primary objective of this partnership, which was announced earlier this week, is to enhance Distributed Ledger Technology (DLT) solutions and propel innovation within the blockchain sphere. Hamad Al Mazrouei, CEO of ADGM Registration Authority, expressed enthusiasm about the collaboration, stating:"We are excited to partner with Solana to pioneer the future of technology, and further enhance the level of knowledge in the space of blockchain by emphasizing the value of regulation and compliance in ensuring robust and sustainable development." Lily Liu, president of the Solana Foundation, shared her optimism about the partnership on the X social media platform, stating:“I spent the day with the @ADGlobalMarket leadership, and have come away with great optimism about their progressive, consultative approach to regulation.”Photo by Shubham's Web3 on UnsplashEmerging crypto hubAbu Dhabi is swiftly emerging as a prominent hub for crypto and blockchain ventures, attracting top firms globally due to its strategic location and supportive government policies. The ADGM has approved a raft of licenses for leading digital asset sector firms. New York-headquartered blockchain and tokenization infrastructure platform Paxos secured an in-principle license back in November. That same month, retail and social trading platform eToro and virtual asset firm M2 both secured trading licenses from ADGM. In September, Standard Chartered-backed digital asset marketplace Zodia Markets secured in-principle approval.Framework for DAOs and foundationsAbu Dhabi Global Market has created an enabling environment for such partnerships to flourish. The emirate has recently launched a $2 billion initiative dedicated to fostering startups in the Web3 and blockchain technology sectors, underscoring its commitment to nurturing the growth of the crypto and blockchain industry. Last year, ADGM introduced regulations to streamline the establishment of blockchain startups in its international free trade zone, aiming to attract investments and enhance market competitiveness and efficiency. In particular, it rolled out a framework for the establishment of decentralized autonomous organizations (DAOs) and blockchain foundations. To establish a distributed ledger technology (DLT) foundation, founders are required to submit a signed Charter to the Registrar, affirming compliance with all relevant laws and financial obligations. Notably, ADGM's regulatory framework for DLT foundations has already yielded significant results, with the recent announcement of the Berlin-based IOTA Foundation unveiling a $100 million foundation in Abu Dhabi. This latest Solana Foundation collaboration is further evidence of the fruits of that framework. In addition to regulatory advancements, Abu Dhabi Global Market introduced a virtual platform in 2022 to connect individuals with virtual asset firms, consolidating its status as a crypto hub. This initiative has attracted several crypto firms to the UAE, drawn by the region's plans to establish itself as a leading crypto hub. Dubai, Abu Dhabi's neighboring emirate, has also witnessed a surge in crypto firms, buoyed by the proactive approach of Dubai’s Virtual Asset Regulatory Authority, which serves as a global model for regulator-industry collaboration.