HTX resumes Bitcoin and Ether services post $30 million hack

Matrixport, a Singapore-headquartered digital assets financial services firm, announced the acquisition of Switzerland-based Crypto Finance Asset Management (CFAM), a regulated crypto fund management firm. The acquisition, completed by way of an all-cash deal, signifies Matrixport’s expansion into the European market. The company announced the deal via a blog post published on the Matrixport website on Sept. 30. Photo by Lin Mei on UnsplashCFAM rebrandAs part of the acquisition, CFAM will be rebranded to Matrixport Asset Management AG (MAM), providing institutional-grade crypto investment solutions, while continuing to act as a crypto market infrastructure provider.  CFAM CEO Stijn Vander Straeten stated that the company’s strategy focused on “trading, custody and staking as well as other post-trade services.” He added, “This move allows us to put all our focus on expanding our core services within the digital asset ecosystem in Switzerland, Germany and across the European markets.” CFAM had formed part of the Crypto Finance Group, an entity part-owned by the Deutsche Börse Group. Regulatory complaint acquisitionIn its press release, Matrixport outlined that the acquisition has been completed with regulatory approval having been granted by the Swiss Financial Market Supervisory Authority (FINMA), the Swiss independent financial markets regulator, which supervises banks, insurance companies and financial institutions in Switzerland. CFAM became the first FINMA-approved manager of a crypto fund in Switzerland. Commenting on the acquisition, Matrixport Co-Founder and CEO John Ge, stated: “We are delighted with the establishment of MAM and warmly welcome the team to the Matrixport family. The acquisition enables clients access to the most innovative, compliant crypto asset management products, and aligns with our strategy to further expand services in Europe.” Personnel changesA number of personnel changes have been made as part of the acquisition. Stefan Schwitter has been appointed as CEO of MAM. Schwitter previously held the role of head of asset management at CFAM. The executive claimed that the complementary strengths of Matrixport and CFAM “will add value to the existing and future client base of Matrixport Group on a global level.” Matrixport was established in 2019 and currently holds over $6 billion in assets under management (AUM). Its founders include Jihan Wu, the co-founder of Chinese crypto miner manufacturer Bitmain and Singapore-based crypto cloud mining company Bitdeer. The firm is licensed as a money services business (MSB) in the United States, while also being licensed to trade in Hong Kong as a trust or company service provider (TCSP) and as a money lender. Matrixport offers its accredited investor and institutional clients over-the-counter (OTC) services, prime brokerage services, digital asset custody through qualified custodian Cactus Custody, asset management and access to real-world asset (RWA) tokenization. In September, the company offered tokenized RWA access in the form of XAUm, a gold-backed token, via its subsidiary company, Matrixdock. It emerged earlier this year that Matrixport had been listed on the Global Unicorn Index, a list of companies compiled by the Huron Research Institute, believed to have a valuation in excess of $1 billion while not yet listed on a public exchange.

Shanghai Embraces Blockchain, AI, and Digital Yuan with New GuidelinesIn a bid to stay at the forefront of technological advancements, the government of China’s largest and most populous city, Shanghai, has issued a set of guidelines aimed at promoting the widespread adoption of blockchain, the metaverse, and the digital yuan.Photo by Edward He on UnsplashIntegrating blockchain technologyThe objective of the measure is to further the use of these technologies across various industries within the city. Leading enterprises across a range of industry sectors, such as automotive, commodity trading, and e-commerce, are now required to look to incorporate these technologies into their operations.The guidelines, which were published last Tuesday, outline the government’s commitment to providing support for platforms that seek to enhance digitalization in production, operations, and management processes. Additionally, they emphasize the development of information technology services centered around big data, blockchain, the Internet of Things, artificial intelligence, and the mobile Internet.Bolstering commodity tradingA key focus for the government is the establishment of a robust internet system to bolster its local commodity trading service. This move is driven by a reliance on “the national financial factor market,” which aims to upgrade the over-the-counter derivatives platform for bulk commodities and strengthen the linkages between futures and cash.Furthermore, the guidelines pave the way for expanding e-commerce service platforms for industrial products, setting up a digital transformation service platform, and fostering the development and application of data resources.Shanghai’s status as China’s financial hub makes it an ideal testing ground for innovative technologies like blockchain and AI. However, China’s approach to cryptocurrency is more complex. It involves support for blockchain technology while at the same time applying strict measures against crypto trading and mining.Aligning with central government policyThe Chinese government’s support for blockchain technology stems from its recognition of blockchain as the underlying foundation of cryptocurrencies. Judging by the blockchain initiatives forwarded by the central government and regional Chinese administrations in recent months, it’s clear that China is keen to develop leadership in the use of blockchain across various sectors. It takes a different view, however, when it comes to projects related to decentralized cryptocurrencies and crypto trading.In recent years, China has cracked down on cryptocurrency activities. In 2013, the government banned initial coin offerings (ICOs), a fundraising method used for cryptocurrency projects. Subsequently, cryptocurrency exchanges were banned in 2017, followed by a prohibition on cryptocurrency mining in 2021.Several factors contribute to the Chinese government’s cautious approach to cryptocurrency. One major concern is financial stability, as crypto can be exploited for illicit activities like money laundering. According to a recent report, Chinese authorities are redoubling their efforts in pushing back against the use of crypto as they’re finding that it is being used to exploit capital control loopholes.These recent guidelines from Shanghai’s administrators aim to capitalize on the transformative potential of emerging technologies while ensuring prudent regulation and control over cryptocurrency-related activities in line with current central government policy emanating from Beijing.

While Indonesia has been recognized as one of the world's swiftest embracers of cryptocurrencies, it has faced a notable setback more recently, with a 60% decline in transaction volumes on local exchanges compared to the preceding year. High taxesIn a recent report by CoinDesk Indonesia, the publication speculates that the imposition of high taxes may be a pivotal factor dissuading traders and impacting the overall market dynamics. Indonesia’s tax system treats crypto assets as commodities, with the burdensome taxes arising as a direct consequence of that classification. The tax framework in Indonesia subjects crypto assets to both income tax and value-added tax (VAT), treating them akin to commodities. Leading crypto exchanges in the country reveal that the cumulative tax load on each transaction could surpass the trading fees imposed by exchanges, potentially discouraging users from engaging in crypto transactions. Oscar Darmawan, the CEO of the leading Indonesian crypto exchange INDODAX, told CoinDesk that users bear an income tax of 0.1% and a VAT of 0.11% on every crypto transaction. Additionally, exchanges are required to remit a 0.04% fee to the recently established national crypto bourse. Darmawan clarified that “this places a significant financial burden on the domestic crypto industry." expresses Darmawan in an interview with CoinDesk Indonesia, underscoring the challenges faced by the industry due to the current tax structure.Photo by Nataliya Vaitkevich on PexelsAn international issueThe tax treatment of digital assets has been a bugbear for the crypto space on an international basis. In Japan, it arose last month that the country’s lawmakers were considering applying an exemption for companies from paying taxes on unrealized cryptocurrency gains. It has since transpired that such an amendment will be applied to its fiscal 2024 tax reform plan. India has applied a heavy tax burden where crypto is concerned, with a 30% tax applied to capital gains relative to the sale of crypto assets. Additionally, 1% taxation applies by way of a tax deducted at source (TDS) on crypto transactions. The use of cryptocurrency for the purchase of goods and services in the United States remains a stumbling block, given that the current tax code treats such a scenario as a taxable event. Last year, two U.S. senators attempted to address that issue, by including a $200 exemption for purchases made with cryptocurrency. Calls for crypto asset reclassificationIn response to this dilemma in Indonesia, some stakeholders within the local crypto industry advocate for a paradigm shift in the classification of crypto assets. They propose treating crypto as securities instead of commodities, anticipating that this alteration could alleviate the tax burden on users. Yudhono Rawis, the CEO of the exchange platform Tokocrypto, asserts: "Both stocks and crypto are tradable assets with profit potential … Thus, implementing the same tax regime for both these investment instruments would be more equitable and consistent." The industry anticipates regulatory changes in the near future, as crypto oversight in Indonesia is set to transition from the commodities regulator to the Financial Services Authority (OJK) in January 2025.