Philippines leading charge in Asia amid global bitcoin payment surge

As South Korea’s cryptocurrency market rapidly evolves, authorities are working to keep the nation's regulatory framework up to speed. Recent initiatives aim to provide clearer guidelines across the sector, encompassing tax policy adjustments, seized assets, and bank-backed digital tokens.Photo by André François McKenzie on UnsplashGovt tightens control over seized cryptoAccording to Yonhap News, the government has approved a new framework for managing roughly 78 billion won ($54 million) in crypto held by the public sector. The move is aimed at imposing clearer controls over digital assets that state agencies hold, including tokens seized or frozen during investigations. Under the new rules, crypto taken from personal wallets must be transferred immediately into agency-controlled cold wallets kept offline. Sensitive access data, including private keys and recovery phrases, must be split among at least two people rather than left in the hands of a single official. That push for tighter custody comes as South Korea also explores new forms of digital money. A bank-issued product known as a deposit token is emerging as a possible middle ground between private stablecoins and a central bank digital currency, or CBDC. Deposit tokens are digital assets backed by bank deposits. They can function like stablecoins in payments, but they are issued by banks rather than crypto firms. The idea is gaining attention as legal uncertainty around stablecoins drags on. South Korea’s central bank has already moved its CBDC pilot, Project Hangang, into a second phase. The Digital Times reported that two more lenders, Kyongnam Bank and iM Bank, have joined the seven banks that participated in the first round: KB Kookmin, Shinhan, Hana, Woori, NH NongHyup, IBK, and Busan Bank. In practice, the emerging view is that deposit tokens may not compete directly with a future CBDC so much as complement it, especially in everyday payments and settlement where banks already have distribution, compliance, and customer infrastructure. Tax gaps persist as market expandsEven as the payments debate advances, tax policy remains underdeveloped. South Korea is set to begin taxing crypto assets in January 2027, but the National Tax Service still does not have detailed standards for several common types of crypto income, according to the Herald Business. Those include staking, lending, airdrops, hard forks, NFTs, and decentralized finance. In a written reply to a lawmaker’s office, the agency said it is still collecting overseas legislative examples and expert views on what should count as taxable crypto income and how acquisition costs should be calculated. That gap is especially important for offshore activity. Profits earned through overseas exchanges are difficult to track outside the 56 jurisdictions participating in the Crypto-Asset Reporting Framework (CARF), an OECD-developed international regime for sharing tax information on crypto assets. The result is growing concern over uneven tax treatment and the possibility that capital could shift abroad if enforcement remains patchy. At the same time, global stablecoin issuers are trying to deepen ties with Korean institutions. Tether, the company behind stablecoin USDT, has returned to South Korea again this year after visiting in 2025. The Aju Business Daily reported that it has been in talks with players including KB Financial Group and local exchange Coinone, looking for ways to expand trading activity and circulation. Tether has argued that its network could help broaden Korea’s crypto ecosystem, while also promoting its new dollar-pegged stablecoin, USAT, as compliant and secure. The sector’s operational risks are also still visible at the exchange level. Bithumb has begun legal proceedings to freeze assets as it tries to recover seven Bitcoin that it failed to claw back after an erroneous payout during a promotional event in February. At the time, the unrecovered amount was worth about 700 million won ($483,000). The move points to a likely civil suit. According to an industry source cited by Chosun Biz, some customers refused to return the funds, arguing that the mistake was the company’s fault. Legal opinion in South Korea, however, appears to be broadly in Bithumb’s favor if the dispute ends up in court. 

Legislation geared towards regulating stablecoins has reached the Legislative Council stage in the Chinese autonomous territory of Hong Kong.  The bill, which extends to a 285 page document, has been formulated following “extensive consultations” with industry stakeholders, according to Eddie Yue, CEO of the Hong Kong Monetary Authority (HKMA).  This latest development moves the Chinese autonomous territory one step closer to having a comprehensive regulatory framework in place for stablecoins. The bill’s arrival at the Legislative Council follows its publication on Dec. 6 in Hong Kong’s Gazette. Subsequently, on Dec. 18, it made its preliminary entry at the Legislative Council by way of a first reading. The legislation will deem a digital asset a stablecoin if it is operated on a distributed ledger, is expressed as a unit of account and maintains an equivalent value relative to another asset that it references. Digital assets issued by governments or central banks will be excluded from that stablecoin definition.Photo by Laurentiu Morariu on UnsplashThree readings requiredBefore the bill can be enacted into law, it is required to go through a series of three readings. Allied to that process is a requirement for a series of debates, with the bill coming under the scrutiny of lawmakers. Depending upon the issues raised, this process may also require the introduction of amendments to the proposed legislation. If passed following the third reading, it will then be forwarded to the autonomous territory’s chief executive, John Lee Ka-chiu, to be signed into law. Once signed into law, stablecoin issuers in Hong Kong will then be required to obtain a license from the city's central bank, HKMA. That licensing process would implicate the HKMA scrutinizing the applicant with an emphasis on the evaluation of the issuer, its resources, the use of reserve assets and the means through which the stablecoin’s value will be rendered stable. Stablecoin optimismThis latest milestone has provoked a cause for optimism among some commentators. Sean Lee, co-founder of Hong Kong-based Web3 firm IDA, told the South China Morning Post (SCMP) that “the applications of stablecoin will be numerous.” Lee outlined that stablecoins can be used for payments, settlements, payrolls and financing, while adding that “new products will spring up, and transactions will be faster, instant, 24/7 – and at a lower cost.” Dominic Maffei, Standard Chartered’s head of digital asset and fintech for Hong Kong, is similarly encouraged. Maffei stated: “As of today, we think that stablecoins are the best available tool for connecting traditional finance and Web3 markets and have proven use cases and business models to support that belief.” Once enacted, the bill is likely to have a significant impact on the stablecoin market in Hong Kong. In Europe, the application of the Markets in Crypto Assets (MiCA) regulation is having such an impact. It has led to a growth in Euro-denominated stablecoin trading while leading U.S. dollar stablecoin Tether (USDT) is being delisted by many platforms due to its non-compliance with these regulations.

A crypto wallet reportedly tied to the multinational banking giant DBS Bank holds over 170,000 Ether, valued at nearly $650 million. Reporting on the matter subsequently prompted DBS to make a denial of any links to the wallet.Photo by Kanchanara on UnsplashClaim asserted, claim deniedOn May 30, blockchain analysis firm Nansen caused some excitement when it took to X, flagging a particular wallet address, identifying it as belonging to an Ethereum whale, taking matters a step further in asserting that the wallet belonged to Singaporean bank, DBS Bank. The submission of securities reports to the Securities and Exchange Commission (SEC) recently by many large corporates led to disclosures from some within traditional finance in the United States of Bitcoin holdings via the spot Bitcoin exchange-traded fund (ETF) products which had been approved earlier this year. A substantial holding of ETH by Singapore’s biggest bank would have been a significant boost for proponents of Ethereum. However, DBS Bank promptly refuted these claims. A spokesperson for the bank subsequently issued a statement to Cointelegraph and Decrypt, stating: "In relation to the post, DBS does not have this position on our books."  Claim not retractedFor its part, Nansen has not retracted its claim. In response to Decrypt, Nansen analyst Edward Wilson stated:"We have it under good authority, via several independent sources, that DBS owns the private key of this wallet and these assets are most likely a part of their custody solution." Wilson told Cointelegraph that it had obtained this information from “a good source,” going on to state: “This is similar to how we see institutions, both crypto-native like exchanges such as Binance or Coinbase custody funds on behalf of their users and non-crypto-native custody funds. The institution is the custodian and is responsible for managing the security of the funds.” The Nansen analyst expressed even more confidence in the claim in response to CryptoSlate. Wilson stated:“Nansen is 100% sure this belongs to DBS – DBS owns the private key of this wallet and these assets are most likely a part of their custody solution.” DBS’s foray into crypto servicesIn 2020, DBS Bank unveiled a crypto trading and custody service, including a platform for conducting security token offerings. At that time, DBS Exchange clarified that while the exchange itself would not hold any assets, it would provide custody services to investors. Since launching its crypto division, DBS Bank has seen significant success. In 2023, DBS reported an 80% growth in Bitcoin trading volume, attributing this surge to the crypto market turmoil of 2022. In February of this year, the Singaporean bank moved to integrate its digital asset exchange business into a new global financial markets unit. In April 2023, DBS opened a branch of the bank on the metaverse. It demonstrated its Web3 credentials further in August 2023 by introducing a metaverse game to tackle the issue of global food waste.