eToro, M2 secure licenses bolstering UAE crypto development

Zodia Custody to Commence Yield Offering on StablecoinsIn a play that’s designed to entice institutional investors, Zodia Custody, a portfolio company of Japanese financial services conglomerate SBI, is gearing up to offer a yield on digital assets.Photo by CoinWire Japan on UnsplashIntroducing “Zodia Custody Yield”The crypto startup has introduced “Zodia Custody Yield,” a crypto staking option designed to reward holders of crypto assets stored within its platform. The initiative has been launched in partnership with Singapore-based DeFi platform OpenEden. It promises returns on stablecoins although full details on the offering remain undisclosed.Jeremy Ng, Co-Founder of OpenEden, expressed his belief in the potential of cryptocurrencies to generate substantial passive income for their holders. Ng stated:“There are billions of dollars worth of stablecoins sitting on the sidelines when they could easily be generating yields for investors.”TradFi embracing digital assetsZodia’s move aligns with a growing trend in the financial industry. Yesterday, a leading US bank, Citi, disclosed its collaboration with Maersk to facilitate services that convert funds into digital assets. The primary goal is to enable the bank’s customers to execute nearly instantaneous payments, unrestricted by traditional business hours.Simultaneously, several prominent asset management firms are awaiting a pivotal decision from the Securities and Exchange Commission (SEC) regarding their applications to launch a spot Bitcoin exchange-traded fund (ETF). This list includes major players such as BlackRock, Invesco, WisdomTree, ARK Invest, Valkyrie, and Franklin Templeton. BlackRock, the frontrunner in the efforts being expended towards ETF approval, submitted its application for a spot Bitcoin ETF on June 16.In a recent interview, Bloomberg analyst Eric Balchunas said that he expects $150 billion in capital to flow into the Bitcoin market within two years of a spot Bitcoin ETF approval in the US.The financial strategies of these entities now prominently feature blockchain and crypto-based products, once considered niche but now integral to their operations. Nonetheless, even with widespread anticipation of the approval of BlackRock’s ETF, the firm faces substantial obstacles. US regulators have subjected BlackRock to intense scrutiny due to concerns regarding its ties to China. Additionally, political figures have criticized the asset manager for prioritizing environmental, social, and governance (ESG) criteria over investor returns.Zodia was spun out of British multinational banking firm Standard Chartered. The bank has a positive outlook relative to crypto. In a bold prediction made in June, the UK-based bank forecasted that the value of Bitcoin could potentially surge to $50,000 by the end of the year, with an even more optimistic projection of $120,000 for 2024.In 2021 Standard Chartered, in collaboration with Northern Trust, a leading asset servicing firm, founded Zodia Custody. Since its inception, the venture has garnered a respectable level of success. It successfully secured $36 million in investments and solidified a partnership with SBI Digital Asset Holdings, enabling its expansion into the Japanese market.In May, the firm launched its crypto custodian service in Dubai, having signed a memorandum of understanding (MOU) with the Dubai International Financial Center (DIFC). In June, Zodia partnered with blockchain infrastructure provider Blockdaemon, in an effort to further its crypto staking offering. Earlier this month, the company announced its arrival in Singapore, with a view towards expanding its digital asset custody service there.

Flybit’s Bug Bounty Program to Strengthen Its Crypto Exchange SecurityKorea Digital Exchange, the operator behind South Korean cryptocurrency exchange Flybit, announced the launch of a bug bounty program aimed at rewarding individuals who identify vulnerabilities in the trading platform’s security infrastructure.Photo by Sergi Kabrera by UnsplashWhite Hat Together initiativeThe inception of this bug bounty program was made possible through Flybit’s involvement in the White Hat Together initiative, which involves the active engagement of the government, enterprises, and citizens. This initiative is hosted by digital service company CJ OliveNetworks in collaboration with the Korea Internet and Security Agency (KISA) and bug bounty platform Find The Gap. Its objective is to reassess the security of Flybit’s services and proactively address weak points within the system.Flybit intends to seize this opportunity to enhance its information protection capabilities, with a commitment to safeguarding user assets and ensuring a reliable trading environment.Recognition for information protectionFlybit is the sole non-fiat crypto exchange in the country that has successfully attained Personal Information and Information Security Management System (ISMS-P) certification as well as ISO 27001 and ISO 27701 certifications. It’s important to note that, in Korea, crypto trading platforms are legally mandated to obtain real-name accounts from banks to facilitate the deposit and withdrawal services of Korean won. Platforms lacking real-name bank accounts are prohibited from supporting trading denominated in Korean won.Additionally, in May, Flybit participated in information protection disclosure and was subsequently certified by KISA as an outstanding company for its investments in information protection.

Among various accounts within a bank, a demand deposit account is considered a “station” where people can temporarily store their money and easily withdraw it for future investments. These accounts are highly liquid, since users can deposit or withdraw funds at any time without having to pay a penalty to a bank.  Following the recent cryptocurrency boom, the five major banks in Korea – KB Kookmin Bank, Shinhan Bank, Hana Bank, Woori Bank and NH Nonghyup Bank – are seeing a significant influx of funds into their demand deposit accounts, according to local media outlet Money Today. This is partly attributed to an increasing number of youths who are seeking to invest in crypto assets, parking their money in these banks’ demand deposit accounts. Shinhan Bank and Nonghyup Bank have seen the highest increase in their deposits, owing to their affiliation with local crypto exchanges that have access to real-name accounts from these banks. Photo by André François McKenzie on UnsplashBTC’s surge attracting young investors to cryptoExperts say that these deposits could be potentially transferred to the crypto market by owners as Bitcoin’s value continues to climb. An insider from a crypto exchange noted that the bullish crypto market, spurred by the U.S. approval of spot bitcoin ETFs, is driving a number of young investors to turn to crypto investments, encouraging them to channel their deposits into buying crypto tokens.  Data from these five major banks shows their total demand deposits by the end of February exceeded KRW 614 trillion ($460 billion), seeing a month-over-month increase of about KRW 23.5 trillion. During the same period, the banks’ combined regular savings grew by KRW 23.6 trillion, while their combined installment savings saw a decrease of KRW 13.3 trillion. This came after the government-led savings product “Youth Hope Installment Savings” reached its maturity, which returns users their principal with relatively large interest gains.  Banks scrambling to attract crypto investors with new savings productsIn response to the potential decline in interest rates in the second half of this year, an increasing number of customers are seeking to put their money into savings products with an interest rate of as low as 3%, according to a banker. In a bid to attract more users, local banks are busy introducing new savings products.  KB Kookmin Bank launched a savings product offering a relatively high annual interest rate of up to 4%, and Shinhan Bank rolled out a savings product targeting youths with an annual interest rate of up to 3.85%.  Meanwhile, Kbank, an online-only bank, is deemed among the largest beneficiaries of the crypto boom, as the bank saw its average daily new customers triple compared to last year. Since 2020, Kbank has served as the provider of real-name accounts to Upbit, the leading crypto exchange in Korea.  Ha Joon-kyung, a professor at the Department of Economics at Hanyang University, said the sudden surge in demand deposits means that a significant portion of these funds will be invested in high-yielding but risky assets, including cryptocurrencies, stocks and real estate.