Circle report highlights APAC moving ahead in stablecoin adoption

CME Group Expands Crypto Reference Rates to Asian MarketsUS derivatives marketplace CME Group is making strides in its efforts to cater to the Asian cryptocurrency market. In collaboration with crypto indices provider CF Benchmarks, the company is set to launch new reference rates for Bitcoin (BTC) and Ether (ETH) aimed specifically at the Asia Pacific (APAC) region.Photo by Pierre Borthiry — Peiobty on UnsplashGoing live next monthThat’s according to a press release published by the company on Wednesday. These new rates, the CME CF Bitcoin Reference Rate APAC and CME CF Ether-Dollar Reference Rate APAC, are scheduled to become available on September 11, according to a joint announcement.This move comes in response to the growing demand from Asian investors and institutions for accurate pricing data during their local trading hours. Currently, a substantial portion of CME Group’s crypto volume, about 37%, occurs outside of US trading hours, with approximately 11% of trades originating from the APAC region. The new reference rates will be published daily at 4 p.m. Hong Kong time, allowing APAC-based participants to align their crypto price risk management more closely with their portfolio strategies.Building upon past effortsCME Group’s efforts to provide accurate and timely reference rates have been ongoing. The company initially introduced its Bitcoin Reference Rate (BRR) in 2016, followed by the Ether Reference Rate in 2018. The BRR calculates the US dollar price of one Bitcoin as of 4 p.m. London time. It leverages the trade flow data from major Bitcoin spot exchanges within a one-hour window to provide an average of volume-weighted medians across 12 five-minute intervals during that period.Notably, the newly announced Asia-focused reference rates will provide a variant to the existing rates tailored for London and New York. Giovanni Vicioso, CME Group’s Global Head of Cryptocurrency Products, emphasized that these APAC reference rates will facilitate more precise risk management for institutional clients utilizing Bitcoin and Ether futures products in their active portfolios or structured products like ETFs.Focusing on AsiaCME Group’s expansion into the APAC region aligns with a broader trend of institutional interest in cryptocurrencies in Asia. The region has seen regulatory developments aimed at providing clarity to crypto businesses over the course of the past twelve months while a lack of regulatory clarity currently prevails in the United States. This move also coincides with the company’s push to further engage with the global crypto derivatives market, which accounts for around 75% of the overall crypto trading volume.CME’s decision to launch Asia-focused reference rates is a strategic move to tap into the growing interest in cryptocurrencies from the Asia Pacific region. By offering accurate pricing information during APAC trading hours, the company aims to provide institutions and investors with better tools to manage their cryptocurrency price risks effectively. From the perspective of crypto market participants more broadly, the move is encouraging given that it comes from the world leader in derivatives markets.

Hong Kong Web3 Companies Invest Millions in VASP LicensesWeb3 firms in Hong Kong are making significant financial investments to obtain Virtual Asset Service Provider (VASP) licenses.According to a report by Foresight News on Tuesday, the cost of these licenses is ranging between 20 million and 200 million Hong Kong dollars ($2.55 million and $25.5 million).Industry sources explained to the publication that the high costs are due to the lack of existing infrastructure in traditional financial institutions, requiring significant investments in various aspects such as products and teams. Even experienced cryptocurrency institutions find the cost of obtaining a license to be substantial.Photo by Daniam Chou on UnsplashEarly licenseesAnalysts at Foresight highlighted that several Hong Kong subsidiaries of exchanges, including OKX, BitgetX, HashKey Pro, OSL, and Gate.io, have already commenced operations. OKX, in particular, has witnessed impressive growth in Hong Kong, with 8,800 registered users and a cumulative trading volume of $150 million as of June 27.To regulate the cryptocurrency exchange industry, Hong Kong introduced new VASP licensing requirements on June 1.These requirements mandate firms to disclose user statistics and company financials to the Securities and Futures Commission (SFC) of Hong Kong for regulatory approval. Exchanges that fail to comply with the requirements will be compelled to halt operations in the special administrative region (SAR) by mid-next year.Virtual asset ratingsOn the same day, the Hong Kong Virtual Asset Consortium unveiled its virtual asset index, which encompasses major cryptocurrencies such as Bitcoin, as well as altcoins and privacy tokens. The consortium aims to offer ratings services and indexes to facilitate retail crypto trading in the SAR. Notably, it has received support from prominent players in the industry, including Huobi, KuCoin, Bitget, and others.The introduction of VASP licenses and the subsequent investments made by Web3 companies demonstrate the evolving regulatory landscape in Hong Kong. With the stringent licensing requirements, the industry aims to enhance transparency and accountability, ensuring the protection of investors and fostering a more secure environment for cryptocurrency trading.The involvement of established exchanges and the formation of the Hong Kong Virtual Asset Consortium further underscore the growing interest and support for cryptocurrencies in the region. These initiatives are designed to provide retail investors with reliable information.In that way, they enable them to make informed decisions while participating in the digital assets space. The consortium’s collaboration with industry leaders reflects a collective effort to promote the growth and adoption of cryptocurrencies in Hong Kong.Last week’s news of banking stalwart HSBC offering Hong Kong-based crypto exchange-traded funds (ETFs) to its banking customers has also delivered a shot in the arm to the development of crypto in the Chinese autonomous territory.As the regulatory framework continues to evolve and mature, it is expected that Hong Kong will attract more Web3 companies seeking to operate in a regulated and compliant environment.The investment in VASP licenses signals a commitment to long-term growth in establishing a base in Hong Kong. Ongoing developments in Hong Kong over the course of the past six months point to the recognition of the potential benefits that cryptocurrencies and blockchain technology can bring to the financial landscape of Hong Kong and level of the level of intent locally to progress the technology.

Animoca Brands Partners With Yuga Labs on ‘Wreck League’ LaunchHong Kong’s Animoca Brands and its San Francisco-based subsidiary nWay, a developer and publisher of multiplayer games, have partnered with Yuga Labs, unveiling their latest creation: “Wreck League.”Photo by Haidan on UnsplashLeveraging Web3Diving into uncharted waters in the realm of esports, this game leverages Web3 technology to empower players with the ability to construct, possess, and engage in battles with their very own distinctive Mech fighters.“Wreck League” challenges the traditional boundaries of gaming by permitting enthusiasts to craft their fighters, engage in fierce competitions, and secure on-chain rewards. Set to debut its maiden season, the game will draw inspiration from the Web3 stalwart, Yuga Labs.The game boasts a dual-pronged design, encompassing both Web2 and Web3 versions. In a savvy maneuver to capture a wide-ranging audience, nWay has devised a marketing strategy that seamlessly integrates effective user acquisition techniques from their previous ventures while circumventing complex blockchain terminology.Clarifying the ingenious concept behind the game, Taehoon Kim, the CEO of nWay, explained: “Wreck League stands as a fusion of Web3 and Web2 concepts. Our mission revolves around unifying communities and players, tapping into the creative wellspring of the Web3 community to consistently elevate the game’s content.”Designed for player retentionWithin the player community, creators, owners, and participants converge to partake in league events. The crux of the game revolves around the assembly of high-performance Mechs, crafted from a collection of 10 distinct Mech Parts NFTs.Player retention is a cornerstone of its design, driven by an engaging trajectory of in-game progression through upgradable mech parts, enhancing gameplay dynamics, and embedding the notion of asset ownership. The more players invest in refining their assets and advancing through levels, the stronger their bond with the game becomes. Active participation in events and tournaments further reinforces player allegiance.Yat Siu, the Co-Founder and Executive Chairman of Animoca Brands, is optimistic regarding the transformative potential of “Wreck League” within the esports sector. Siu envisions the game, where digital asset ownership is the norm, as a harbinger of a monumental shift in competitive gaming dynamics.Expanding market reachFor Yuga’s part, the NFT and metaverse company is using gaming, through this particular partnership, as a mechanism to broaden the reach of its well-established NFT brand. That said, it has also made its own individual efforts in that regard recently. The Web3 studio, best known for having created the Bored Ape Yacht Club (BAYC) NFT collection, has released two games, Dookey Dash and Forge, independently.nWay and Animoca Brands get to benefit from access to Yuga’s well-known NFT collections through the partnership. The companies confirmed that as part of the gaming experience, gamers will be able to collect and take ownership of in-game digital assets in the form of NFTs.Animoca acquired nWay in December 2019 for $7.69 million. The games developer and publisher creates and distributes triple A games on console, PC, and mobile platforms. At the time of the acquisition Animoca Brands outlined that it foresaw nWay innovating in the area of blockchain-based games, with the intention of both companies working together relative to that endeavor.