Korea’s KFTC launches blockchain-powered loan service for public servants

Full operating license approval for Hex Trust in DubaiIn yet another instance of progress for the cryptocurrency sector, Hex Trust MENA FZE, the Dubai-incorporated subsidiary of Hong Kong-headquartered institutional-grade crypto custodian Hex Trust, has successfully secured an operating license from the Dubai regulator, the Virtual Assets Regulatory Authority (VARA).Photo by Mohammed Nasim on UnsplashExtending regional presenceThis regulatory milestone, acknowledged by the firm in a statement it made public on Wednesday, not only solidifies Hex Trust’s presence in the Middle East but also marks a strategic move to extend its crypto custodial services to institutional clients and sophisticated investors in Dubai. While based in Hong Kong, Hex Trust has offices in Dubai, Singapore, Vietnam and Italy.This full operating license signifies the successful conclusion of the approval process within VARA’s regulatory framework for crypto service providers, which came into effect earlier this year. Initially granted a minimum viable product (MVP) operational license in February, Hex Trust’s latest achievement grants it the official authorization to continue its operations in the region, marking a pivotal moment in the company’s expansion strategy.With an increased footprint in Dubai, Hex Trust is now poised to deliver comprehensive crypto custodial services to both institutional clients and sophisticated investors. This strategic move is in line with the company’s aspiration to meet the escalating demand for secure and regulated digital asset storage solutions in the Middle East.Filippo Buzzi, Hex Trust’s MENA regional director, underscored the company’s dedication to expanding its reach in the Middle East, stating:“Hex Trust is fully committed to expanding into the Middle East and sees enormous potential for digital asset growth given the progressive regulations, welcoming governments, and thriving crypto ecosystem in the region.”This statement not only highlights the favorable regulatory environment but also emphasizes the increasing interest in cryptocurrencies within the Middle Eastern market.$88 million funding roundHex Trust’s recent success in Dubai comes on the heels of its $88 million Series B funding round last year, showcasing the company’s proactive approach to securing regulatory approvals on a global scale.In August, the firm received regulatory clearance in France, enabling it to offer a spectrum of services, including digital asset custody, purchasing, selling and trading. These regulatory triumphs position Hex Trust as a reputable and compliant entity in the competitive crypto custodial space.Series of approvalsWhile Hex Trust has demonstrated its adept navigation through regulatory processes in Dubai, it’s one of many companies to obtain licensing in the emirate in recent weeks.It emerged yesterday that CRO DAX Middle East, the Dubai-registered subsidiary company of Singapore-headquartered Crypto.com, received a trading license from VARA.Last week, Korean Web3 company CarrieVerse clarified that it had joined the Dubai Multi Commodities Center (DMCC) as a metaverse service provider. The DMCC is a United Arab Emirates (UAE) government agency which has developed into a hub for investors and Web3 startups. CarrieVerse and the DMCC have not as yet revealed details regarding the roadmap for the partnership.At the start of this month, VARA awarded Singapore’s WadzPay, a business-to-business (B2B) technology firm that focuses on enabling digital asset-based transaction processing and settlement, a license to trade within the emirate. Meanwhile, on Nov. 1, it emerged that crypto wallet project Backpack had received a license from the Dubai regulator.

While the digital assets space moves at a blistering pace, the Asia Pacific (APAC) region is on the brink of a substantial regulatory transformation, with a focus on tokenization as we enter 2024.Photo by CHUTTERSNAP on UnsplashContinued regulatory focusThat’s according to Rahul Advani, Ripple’s Singapore-based Policy Director for the Asia-Pacific (APAC) region. The Ripple Labs Executive expressed his thoughts as part of a series communicated by the company last week on social media, emanating from some of its top tier executives. This shift comes amid growing interest in tokenized assets within and beyond traditional financial markets. In setting out his thoughts, Advani reflected on the APAC region’s regulatory focus on achieving clarity for crypto in 2023. Throughout the year, there has been an emphasis on consumer protection, retail investor safeguards, market integrity and business conduct requirements. This regulatory momentum is expected to continue into 2024, particularly concentrating on enhancing retail protections. Shift towards tokenizationThe Ripple Policy Director highlighted tokenization, which converts assets into digital tokens, as an item that is experiencing increased adoption. Notable collaborations, such as Iota’s partnership with Fireblocks to streamline asset tokenization, highlight its relevance in both crypto and traditional finance. The United Kingdom’s venture into fund tokenization further exemplifies this cross-industry trend. Ripple itself has been moving further towards real-world asset (RWA) tokenization. In September, an influential pseudonymous account on X underlined how Ripple was preparing itself to get further involved in asset tokenization. The account stated: “#Ripple now owns properties that can build the infrastructure for exchanges, companies, wallets and apps to connect to fiat rails, banks, trusts, retirement plans, etc., to tokenize real world assets and hold them in safe, compliant ways.”In May the company collaborated with the Hong Kong Monetary Authority (HKMA) on a pilot program with the objective of showcasing an RWA tokenization solution. APAC to advance CBDC and stablecoin developmentIn the stablecoin sector, where digital assets are pegged to stable values, APAC is positioned to lead in regulatory efforts, according to the Ripple executive. While some regions are still formulating stablecoin regulations, Advani envisions more APAC jurisdictions providing the necessary regulatory clarity to foster innovation while ensuring consumer safety. In the broader context, Advani anticipates more focused efforts towards the development and implementation of central bank digital currencies (CBDCs), emphasizing the need for a shift from speculative hype cycles. He wrote: “In the coming year, we also foresee a regional trend that involves a more focused effort on developing CBDCs. Stablecoins will continue to be a regulatory priority, with an emphasis on ensuring a high degree of value stability.” The forecast underscores the dynamic regulatory landscape in APAC, where regulators must delicately balance fostering innovation, safeguarding investors and maintaining market stability. Striking this balance will be a defining aspect of the regulatory narrative in 2024. Advani’s thoughts were offered by Ripple alongside those of some of his colleagues at the company, such as the enterprise blockchain firm’s APAC region Managing Director Fiona Murray. These predictions from Ripple executives collectively offer insights into the evolving regulatory landscape and industry dynamics as we approach 2024.

Monthly Active Users of Binance in South Korea Surpasses 230,000The monthly active user (MAU) count for the virtual asset exchange app Binance has surpassed 230,000 in South Korea, according to a recent analysis reported by local news outlet Etoday. This places Binance as the fourth-largest exchange in terms of user base, following more prominent local won-denominated exchanges Upbit, Bithumb, and Coinone.Photo by Vadim Artyukhin on UnsplashSoaring numbersAccording to data from the insights platform Mobile Index, the MAU for the Binance app in Korea averaged 230,965 users from February to July this year. Starting from 238,487 users in February, the number peaked at 240,000 in April, followed by a slight decrease to 219,010 in June and 215,743 in July. These figures significantly outpace the 131,799 average for Korbit and 36,123 for Gopax, recorded over the past six months.The abundance of users is also reflected in the app’s high trading volume in Korea. In May this year, Binance reportedly accounted for around $58.3 billion in trading volume from Korean users, representing approximately 13% of the total trading volume, according to the Wall Street Journal. This makes Korea the app’s second-largest market after China in terms of trading volume.These statistics are notable considering the fact that Binance does not support won-denominated trading nor has a Virtual Asset Service Provider (VASP) license for Korean operations. They can thus be attributed to the availability of futures trading, which is not offered by local exchanges. According to the Journal, futures trading accounts for 98% of the transactions conducted by Korean users.Regulatory validationMoreover, Binance is registered on the travel rule whitelists of three of the country’s largest exchanges: Upbit, Bithumb, and Coinone. This travel rule regulation was put into effect last year, requiring financial institutions to share data on cryptocurrency transactions.Being whitelisted means that users of the aforementioned exchanges can easily make trades on Binance after completing Know Your Customer (KYC) identification procedures.Each exchange follows its own criteria to add virtual asset service providers to its whitelist, allowing only whitelisted entities to send and receive transactions.Industry experts claim that this is yet another depiction of just how lucrative Korea’s crypto market is, as is the case with the significant trading volumes recorded by domestic exchanges. This is likely driving the active efforts of foreign exchanges, including Binance, to penetrate the market.Binance’s ongoing regulatory challengesEarlier this year, Binance acquired a majority stake in Streami, the operator of Korea’s KRW-to-crypto exchange Gopax, aiming to solidify its presence in the Korean market. Following this acquisition, Streami underwent leadership transitions that saw Lee Joon-haeng step down, making way for Binance’s APAC head Leon Sing Foong. Subsequently, the leadership baton was passed to Lee Joong-hoon, the former Vice President of Gopax.For these shifts in leadership, Streami submitted reports to the Financial Intelligence Unit (FIU) under the Korean Financial Services Commission (FSC) to inform the regulatory body about changes in company representatives. However, despite these notifications, the financial regulator has not yet granted its approval, likely influenced by the ongoing legal challenges Binance is facing in multiple jurisdictions, including that of the United States.In a seeming effort to address this regulatory impasse, Streami has recently decided to undergo yet another change in its CEO position. This marks the third leadership alteration within a span of six months. Meanwhile, the identity of the incoming CEO is yet to be disclosed.Oscillating trends of growth and declineIn related news, Mobile Index also reported that Upbit had the highest MAU among virtual asset exchange apps in Korea. From February to July, Upbit averaged an MAU count of 3,280,746, surpassing the 1,005,432 average for Bithumb, marking a threefold difference. Coinone’s average MAU during this period was calculated at 316,277.However, over the same six-month period, all won-denominated exchanges except for Korbit experienced a decline in MAU. Gopax witnessed a 22.3% drop from 42,556 users in February to 33,059 users in July. This was followed by 20%, 14.8%, and 6.8% declines for Coinone, Bithumb, and Upbit, respectively. Binance also experienced a 9.5% dip.In contrast, Korbit saw a 16.5% increase, rising from 118,816 MAU in February to 131,799 in July.