Victory Securities granted approval for retail crypto trading in Hong Kong

Turkey crafts new crypto regulations with FATF grey list removal objectiveIn an effort to secure removal from the Financial Action Task Force’s (FATF) “grey list,” Turkey is in the process of crafting new regulations governing crypto assets.The FATF, established by the Group of Seven (G7) advanced economies, serves as a guardian of the international financial system. It’s an international organization dedicated to combating financial crimes, which added Turkey to its “grey list” in 2021. In 2019, it cautioned Turkey about significant deficiencies in procedures for freezing assets linked to terrorism and the proliferation of weapons of mass destruction.Photo by Michael Jerrard on UnsplashCrypto compliance for FATF upgradeTurkish Finance Minister Mehmet Simsek recently discussed this matter with a parliamentary commission, according to a report published by Reuters. Simsek highlighted the FATF’s evaluation of Turkey’s adherence to 39 out of the 40 standards set by the organization. The single outstanding issue pertains to crypto assets, and Simsek revealed plans to introduce a crypto assets law in parliament to address this concern. However, he did not delve into specific legal changes.The Turkish government is taking action to align with international standards and remove the shadow of the “grey list.” The Turkish Presidential Annual Program for 2024, as published in the Official Gazette of the Republic of Turkey on October 25, outlines a commitment to establish comprehensive cryptocurrency regulations in the country by the end of 2024. Within the extensive 500-page document, Article 400.5 sets the goal of providing clear definitions for crypto assets, potentially subjecting them to taxation in the future.Additionally, the document seeks to establish legal definitions for crypto asset providers, including cryptocurrency exchanges. However, it refrains from specifying the finer details of the upcoming regulatory framework.Crypto popularityTurkey has been an outlier in terms of cryptocurrency use by comparison with many of its international peers. A report by KuCoin earlier this year validated that reality, indicating a significant increase in the number of crypto investors in Turkey over the course of the previous 18 months. In the aftermath of a devastating earthquake which hit the country on Feb. 6, crypto was reported to have been used as a means to get aid to those affected quickly and easily.However, developments in the crypto space have also included difficulties. It was reported in July that the use of crypto for the earthquake relief effort in Turkey was also being used as a cover by an affiliate of the terrorist group ISIS to launder money and receive funding. Turkish users of the Thodex crypto exchange platform were the victims of fraud in 2021, with the founders of that business having been sentenced for that fraud in September. In 2021 the country moved to ban crypto payments against a background that has seen the Turkish lira experience hyper-inflation.CBDC developmentTurkey’s central bank has been making strides in the digital currency arena, successfully conducting the initial trial of its central bank digital currency (CBDC), the digital lira, by December 2022. The central bank has expressed its intention to continue testing and exploring digital currency development throughout 2024.The move to enhance regulation and compliance in the crypto sector in Turkey aligns with global efforts to ensure transparency and accountability in financial systems.

The cryptocurrency market has come under renewed pressure as escalating global tariff tensions converge with growing stress in the private credit sector, though a South Korean analyst suggests that prospects for a rebound remain intact. According to Etoday, Yang Hyun-kyung, a researcher at iM Securities, noted that risk assets staged a brief rally after the U.S. Supreme Court ruled that President Donald Trump’s reciprocal tariffs, imposed under the International Emergency Economic Powers Act (IEEPA), were unlawful. However, the relief proved short-lived as tariff fears reignited following the announcement of a 10% levy and a subsequent proposal to increase it to 15%.Photo by Markus Winkler on UnsplashLiquidations surge amid private credit jittersYang observed that market volatility intensified as concerns in the private credit market resurfaced after Blue Owl Capital halted redemptions for its Blue Owl Capital Corporation II (OBDC II) fund and initiated a $1.4 billion asset sale. Yang highlighted that $420 million in liquidations hit the crypto market as Asian trading opened on Feb. 23. This included $386 million in long positions and $34 million in shorts, signaling a swift deleveraging. These pressures are reflected in current price levels. According to CoinMarketCap, Bitcoin, the world’s largest cryptocurrency, is trading just below $65,000, down 1.13% over the past 24 hours. The token remains approximately 49% below the all-time high recorded in October. Bitcoin’s decline has widened valuation losses among digital asset treasury (DAT) firms. Yang estimated that Strategy, which holds 717,131 BTC, is sitting on roughly $7.89 billion in unrealized losses. Yang added that a potential shift toward monetary easing ahead of the U.S. midterm elections, combined with reduced regulatory uncertainty from the crypto market structure bill known as the Clarity Act, could serve as short-term catalysts for a rebound. Binance focuses on regulatory alignment in KoreaDespite the market slump, crypto firms are deepening their presence in South Korea. In an interview with ZDNet Korea, Binance Head of APAC SB Seker stated that the company’s focus is not on increasing its ownership stake, but on establishing a compliant, trusted, and sustainable operation in the country. Binance currently holds a 67.45% stake in Gopax, operated by Streami, after securing regulatory approval to become its largest shareholder. Addressing the issue regarding GoFi—Gopax’s DeFi product designed to generate returns for users—Seker said any repayments of unpaid customer funds must comply with Korean commercial law and satisfy relevant legal and administrative procedures. He added that discussions with regulators are ongoing and the company cannot unilaterally set a repayment schedule. Seker also noted that Binance plans to work closely with authorities to advance its business in areas such as institutional investment and stablecoins. Regulators reiterate exchange ownership capsAs the digital asset sector evolves, South Korea is moving to tighten oversight. MoneyToday reported that financial authorities have notified the heads of the country’s five largest crypto exchanges—Upbit, Bithumb, Korbit, Coinone, and Gopax—of their intention to introduce caps on the ownership stakes of controlling shareholders. The notification is widely viewed as a precursor to the government’s release of the Digital Asset Basic Act, often described as the second phase of the country’s crypto regulatory framework. The Financial Services Commission has maintained that a single largest shareholder’s stake in a crypto exchange should be limited to between 15% and 20%. At the meeting, officials outlined key elements of the forthcoming bill and reaffirmed their intention to enshrine the ownership cap in law. Representatives from the five exchanges and the Digital Asset eXchange Alliance (DAXA), the industry body to which the platforms belong, reportedly raised concerns about the proposal. 

American digital asset prime brokerage FalconX has unveiled its strategic expansion into Hong Kong, doubling down on its growth within the Asia-Pacific (APAC) region.Photo by Chapman Chow on UnsplashOTC brokerage servicesThe move, announced by the company through the release of a statement on Thursday, represents the firm’s latest stride in pursuing a global expansion strategy. In February 2023 the company announced that it was establishing its APAC headquarters in Singapore. FalconX intends to provide tailored over-the-counter (OTC) brokerage and OTC virtual asset derivatives services to professional investors in Hong Kong, including proprietary trading firms, family offices and fund managers. Leading the charge in this expansion is Belle Leung, who assumes the role of commercial lead in Hong Kong. Leung brings a wealth of experience from her previous position as head of SaaS sales for digital assets at OSL in Hong Kong. Her primary focus will be on raising awareness of FalconX’s offerings within Hong Kong's rapidly expanding institutional Web3 community.Leung expressed enthusiasm for Hong Kong's proactive regulatory approach, noting the strong market certainty it has generated. She emphasized FalconX's support for and alignment with the regulatory landscape. This expansion aligns with ongoing efforts by Hong Kong regulators to shape a conducive environment for virtual assets and related products, thereby providing market certainty and fostering innovation. The recent guidelines set by Hong Kong's regulators aim to align the region’s regulatory framework with international best practices, positioning it as a leading global center for digital asset innovation and investment. Executing an expansion strategyThe company is likely to have been planning its Hong Kong expansion for some time. Earlier this month, FalconX confirmed that it would be expanding its APAC operations. In November, the company was actively recruiting to fill Hong Kong-based positions. That same month, FalconX announced a partnership with Bullish, a digital assets exchange with 110 employees in Hong Kong. As part of that integration, the prime broker gained access to further digital asset liquidity on the Bullish platform.In its home market in the United States, the company has also been furthering its market influence. With spot bitcoin exchange-traded funds (ETFs) having been approved in the U.S. in January, FalconX executed over 30% of all bitcoin creation transactions for ETF issuers on the first day of trading. Matt Long, FalconX's APAC general manager, underscored the pivotal role of Hong Kong in the virtual asset innovation landscape, noting its historical significance as a hub for such innovation. He emphasized the region's leadership in the market with a clear focus on Web3 technologies. Long expressed FalconX's commitment to global growth and confidence in Hong Kong's progressive stance on virtual asset regulation and its leading position in the Web3 ecosystem. FalconX's expansion into Hong Kong follows its recent strategic moves in the Asia Pacific region, including the appointment of Ivan Lim as Trading Manager, APAC derivatives, based in the firm’s Singapore office. These developments underscore FalconX's intention to expand its footprint in the region and cater to the evolving needs of institutional investors in the digital asset space.