Zipmex Thailand halts crypto trading citing SEC compliance

Liminal, a Singapore-based digital asset custodian, has gained regulatory approval in Abu Dhabi, as part of a series of recent steps the company has taken to expand across Asia and the Middle East. Extending digital asset custody to the Middle EastTaking to the X social media platform on May 13, the company outlined that its First Answer Middle East subsidiary received Financial Services Permission (FSP) from the Abu Dhabi Global Market's (ADGM) Financial Services Regulatory Authority (FSRA) on May 9. The approval allows the firm to provide digital asset custody in the region. Liminal had initially been granted in-principle approval last year. In a series of posts, the company outlined that it sees Abu Dhabi’s regulatory framework in respect of digital assets as forward-thinking. It drew particular attention to the work of the FSRA in developing a robust framework to enable institutions to enter the digital assets space.Photo by Sohail Sarwar on UnsplashGame changerOn the actual license approval itself, the company stated, “The FSP license allows Liminal to hold, manage, and safeguard digital assets on behalf of institutions, hedge funds, venture capitalists and professional clients. This is a game-changer for digital asset custody practices in the region.” Further regional expansionOver the course of recent months, Liminal has scored a number of regulatory successes within the Asia Pacific (APAC) and Middle East and North Africa (MENA) regions. Its success within the United Arab Emirates (UAE) has not been confined to Abu Dhabi. In April, First Answer Custody FZE, a Dubai-based subsidiary company, secured initial approval from the emirate's regulator, the Virtual Asset Regulatory Authority (VARA).  Meanwhile, Liminal's Indian subsidiary, First Answer India Technologies, has been established and registered as a reporting entity. As a consequence, it has become the first digital asset custodian registered with India’s Financial Intelligence Unit (FIU), an organization that falls under the umbrella of the Department of Revenue, and  which collects financial intelligence relative to money laundering.  Making further in-roads within the world’s most populous country in November, India’s Central Bureau of Investigation (CBI) appointed the firm with a mandate to manage seized digital assets. Liminal has ties with India insofar as it was founded by Mahin Gupta in 2021, the co-founder of crypto exchange ZebPay. In an interview with CoinDesk, Manan Vora, senior vice president of strategy and business operations at Liminal stated:"We initiated a strategic drive two years ago to secure regulatory licenses in key markets across APAC and EMEA (Europe, Middle East and Africa), strategically positioning ourselves to cater to institutional clients.” Vora added: "Our strategic vision is to expand from our present technology presence in Europe and Taiwan to pushing for regulatory victories there. In Indonesia, we are already working as a technology provider for the nation's sovereign digital asset exchange." Within its home market of Singapore, Liminal was grandfathered into a new licensing system that the city-state introduced recently in respect of digital asset custody as a consequence of already having been a provider of such services in Singapore. The company has been given a grace period of six months. Within that timeframe, it intends to submit an application to local regulator, the Monetary Authority of Singapore. 

Jersey-headquartered Komainu, a digital asset custodian backed by Japan’s Nomura Holdings, is in the process of acquiring Propine Holdings, a Singaporean competitor. Subject to approvalKomainu has signed an agreement in principle with Propine to acquire the company, according to a press release published on Oct. 22 by PR Newswire on behalf of the two firms. One of the key elements in completing the deal is attaining the approval of local regulator the Monetary Authority of Singapore (MAS). This is Komainu’s first acquisition, and according to the firm’s co-CEO Paul Frost-Smith, it will be the first of several. According to Bloomberg, Frost-Smith stated in an interview that “an absolutely key factor in building” the business is obtaining access to Propine’s Capital Market Services license, which the company was awarded in Singapore. Frost-Smith described the acquisition as "setting ourselves up for the future with a licensed platform that we can grow." The company intends to further its efforts in terms of compliance by applying for a Major Payment Institution (MPI) license in Singapore. Komainu is motivated in developing in this manner as it has identified increasing demand from established institutions in Singapore for advisory services.Photo by RDNE Stock project on PexelsStrategic hubThe Komainu co-CEO said that the Asia-Pacific (APAC) region was central to Komainu’s heritage. With that, he added that Singapore is “an important strategic hub for Komainu in Asia and Propine will enhance our capabilities in meeting the significant client demand we are experiencing, including for Komainu Connect, our collateral management service, which is already extensively utilised by our investor clients in Hong Kong, Singapore, Malaysia, Thailand and Australia.” Back in August, global crypto exchange platform Bitfinex signed a memorandum of understanding (MOU) with Komainu Connect, with a view towards enhancing trading security. In July Komainu was added by crypto infrastructure firm Fireblocks to its Global Custodian Partner Program. The Japanese market has been one that Komainu has been focusing on. Frost-Smith asserted that it will serve as a major hub for the company, given that it is home to its primary backer, Nomura.  In November 2023, the company partnered with Crypto Garage, a regulated Japanese crypto-asset financial services firm. The collaboration extended Komainu’s dealings with the firm, given that it had invested in Crypto Garage’s parent company, Digital Garage, previously. At the time, the companies claimed that the partnership would allow them both to leverage their collective expertise. Komainu has also been following a regulatory-compliant path in other markets. In the UK, where it’s stationed, it received permission from the Financial Conduct Authority (FCA) to operate as a crypto custodian in October 2023. In August of the same year, it was awarded an operating license by the Virtual Asset Regulatory Authority (VARA) in Dubai. Alongside Nomura, the company was also established with the backing of digital asset security firm Ledger and digital asset investment manager CoinShares. Earlier this year, Komainu was approved by Nasdaq to be a core custodian relative to its suite of crypto indices. 

Japan Moves to Allow Startups to Sell Digital Tokens to VC FundsIn a move that further advances Japan’s efforts in the digital assets space, the country is poised to permit startups to raise capital from venture capital firms using digital assets instead of traditional stock.The approval of this approach will provide a broader spectrum of funding options for emerging companies deeply entrenched in the world of blockchain technology.Photo by Bagus Pangestu on PexelsAcceptance beyond conventional assetsCurrently, limited partnerships in Japan are predominantly associated with conventional assets such as shares, stock options, and security tokens defined by local securities laws. However, according to a report published by local financial daily Nikkei Asia on Friday, an impending rule change is set to expand this list to encompass other tokens and crypto assets, heralding a fresh era of investment opportunities in a domain that has remained relatively under-explored within the country.The Japanese government is on track to present the requisite legal revisions to the parliament, with expectations for this transformational move to occur as early as 2024. Unlike traditional shares, blockchain-based tokens offer the unique advantage of swift creation without the need for intermediaries or brokerage services.Consequently, fundraising via digital assets is becoming the preferred choice for companies operating in the cutting-edge realm of Web3 technologies, including blockchain.In Japan, a number of companies, such as the blockchain developer HashPalette, have already raised substantial amounts through token offerings. However, the existing limitations obstructing limited partnerships from investing in tokens have hindered Japanese venture capital firms and institutional investors from partaking in the burgeoning success of Web3 enterprises.Overseas token issuanceTraditionally, startups have resorted to issuing tokens in overseas locations like Singapore and Dubai. On the venture capital front, Japanese powerhouse Skyland Ventures ventured into tokens through its Singapore-based subsidiary.Notably, Japan’s Financial Services Agency (FSA) is contemplating a tax code revision for fiscal year 2024 and beyond, with the objective of exempting crypto assets and tokens from taxes on unrealized gains based on market value. This strategic move aims to eliminate a significant deterrent for potential investors in the field.While venture capital firms are eagerly anticipating this legislative change, some, like B Dash Ventures, acknowledge that the revision of the limited partnership law alone may not trigger an immediate surge in fundraising via virtual currencies. Nevertheless, it marks a significant step toward fostering a more conducive environment for digital asset investment.Removal of limited partnership restrictionsJapan’s forward-looking approach also extends to the removal of restrictions on limited partnerships that previously mandated them to invest more than half of their capital within the domestic market. This move is expected to bolster profits, empower venture capital firms with more substantial capital reserves, and ultimately fuel investment in domestic startups.Japan’s decision to embrace the potential of digital assets for startup fundraising is a progressive move. Initial exchange offerings (IEOs) are already authorized in Japan, but this proposed funding mechanism would offer a new channel through which Web3 innovation can be financed within the East Asian island nation. Given that most Web3 startups raise funds in this way, it will mean that Japanese-based firms in the Web3 space will be able to develop and participate fully as this innovation rolls out further on a global basis.