Regulator lifts investment cap for real estate-backed tokens in Thailand

Research Center Highlights Overvaluation in Overseas Crypto Holdings Reported to Korean Tax AgencyThe Korbit Research Center, affiliated with one of South Korea’s leading cryptocurrency exchanges, Korbit, has raised questions about the size of overseas cryptocurrency holdings reported by Korean individuals and businesses to the National Tax Service.Photo by REDioACTIVE on PixabayThe issue of market-making activitiesThe center noted that following the 2017 initial coin offering (ICO) boom, many enterprises that issued cryptocurrencies through offshore entities might still be holding onto their native tokens. This would have resulted from their inability to distribute these tokens to the market after the speculative bubble burst. The center believes these reported values could have been influenced by the issuers’ market-making activities, possibly inflating their worth.According to the National Tax Service, Korean individuals and corporations hold a total of KRW 130.8 trillion (around $98 billion) in overseas crypto accounts. Notably, 73% (KRW 120 trillion) of this sum is held by 73 corporate entities.Highlighting a critical aspect of cryptocurrency valuation, the Korbit Research Center pointed out that when tokens are priced based on market-making activities, they may be overvalued. They further underscored that even if the true value of overseas holdings by these entities is only a tenth of the reported sum, a figure like KRW 12 trillion is still substantial.Retail investors seeking overseas optionsFurthermore, the center touched on retail investors, noting that the KRW 10 trillion in their offshore accounts indicates a gap in services offered by Korean crypto enterprises. It suggests that individual investors might be exploring foreign markets due to domestic limitations like the absence of derivatives and lending options.Given the borderless nature of the crypto industry, Korean individuals readily turn to overseas services that cater to their needs. The Korbit Research Center estimates a KRW 10 trillion unmet demand in the domestic crypto sector, suggesting that stringent local regulations might be driving capital outflows.

After being targeted in a $1.4 billion hack, the global crypto exchange platform Bybit was awarded in-principle approval to establish itself as a Virtual Asset Platform Operator (VAPO) within the United Arab Emirates (UAE). While Bybit announced the milestone via a press release published on Feb. 27, the approval had been awarded on Feb. 18, three days before the platform was hacked.Photo by Saj Shafique on UnsplashRegulatory challengesIn addition to the recent exploit, the crypto exchange platform had been having difficulties on the regulatory front in recent months, and from that perspective, this licensing award is a welcome development. Last December, the Malaysian Securities Commission reprimanded the platform and its CEO, Ben Zhou, for carrying out digital asset trading activities in Malaysia without having obtained the necessary licensing. Consequently, the firm left the Malaysian market, promising to return once it had obtained the required licenses. For similar reasons, Bybit left the Indian market in January, citing a need to “operate in full compliance” with local regulations. The company said that it was working with the regulator to finalize its registration as a Virtual Asset Service Provider (VASP) in India. The platform also experienced difficulties in complying with the recently introduced Markets in Crypto Assets (MiCA) regulation in Europe. However, it has been working with regulators in Austria in an effort to acquire MiCA licensing. Consequently, the French regulator, Autorité des Marchés Financiers, removed the firm from its blacklist. Earlier this month, Japan’s Financial Services Agency (FSA) ordered Apple and Google to remove the apps of a number of unregistered crypto platforms, including Bybit, from the Japanese versions of their app stores.  Commenting on this recent achievement in the UAE, Ben Zhou stated: “This approval marks a crucial step in our journey to providing secure and transparent crypto trading solutions. Bybit remains dedicated to working hand-in-hand with regulators to foster a compliant and innovative digital asset ecosystem to both retail and institutional investors in the UAE.” Hack falloutIt’s unclear to what extent the recent hack, which is understood to be one of the largest thefts of any kind, may be diverting resources and focus away from the efforts the company was making to address regulatory issues globally. However, it’s reasonable to assume that recent events make for a challenging time for the company. On Feb. 26, the Federal Bureau of Investigation (FBI) in the United States said that North Korea was responsible for the hack. The agency warned exchanges to freeze transactions linked to the stolen funds. The FBI outlined that “TraderTraitor” actors have been converting the funds to Bitcoin and other digital assets in an effort to launder the funds and eventually extract the funds in fiat currency. North Korea’s Lazarus hacking group has gained notoriety for its successes in hacking crypto platforms and the sophisticated nature of the attacks mounted in the process. The group is suspected of having hacked the Indian crypto platform WazirX last year, which resulted in the theft of $235 million in digital assets.

Colt Technology Partners With Singapore’s AsiaNextColt Technology Services, an established player in the digital infrastructure sector, has unveiled a strategic partnership with AsiaNext, an emerging name in the crypto exchange domain.News of the collaboration emerged on Thursday, with the partnership designed to harness the strengths of Colt’s secure and high-performance digital infrastructure solutions to foster high-frequency trading of various digital securities and crypto derivatives on the AsiaNext platform.AsiaNext is a joint venture between Japan’s SBI Digital Asset Holdings and Swiss digital infrastructure firm, SIX Group. The entities behind the venture identified similarities in the regulatory approach taken in Switzerland and Singapore, and for that reason, AsiaNext was developed to grow the business in the city-state.Photo by Julien de Salaberry on UnsplashAccessing Multicast Market DataThe partnership will see AsiaNext leverage Colt’s Multicast Market Data in the Cloud. This service facilitates seamless connectivity between buyers and sellers, bridging the divide between mainstream finance and the secure realm of digital assets trading. The move takes on greater significance against the backdrop of Asia’s rapid ascent in digital asset trading and its central role in shaping global cryptocurrency regulations.AsiaNext has been targeting institutional investors and aims to offer a comprehensive suite of services encompassing listing, trading, and post-trade functions for digital assets. The exchange is attempting to provide institutional investors with a secure platform for trading digital assets, bolstering the crypto derivatives market in the region.Alongside Colt’s Multicast Market Data product, AsiaNext will also benefit from access to Colt’s PrizmNet, which enables low latencies for global delivery of data, software, content, and financial services.Commenting on the deal, Russell Toop, Colt’s Team Lead, Capital Markets Asia, remarked: “Our partnership with AsiaNext demonstrates our firm commitment to capital markets in Asia and across the world, and we’re excited to be part of its journey at the earliest stages as it sets out to bring digital assets to the mainstream.”Yuen Keng Yin, Chief Technology Officer of AsiaNext, echoed the sentiment by highlighting the transformative potential of Colt’s solutions for institutional investors, stating:“Their solutions support our investors in securing their position in this rapidly-growing market, so they can optimize their digital assets trading strategies and open up exciting new opportunities for their clients.”Working towards a full CMS licenseAsiaNext has been making progress within the Singaporean market. In June, the local regulator and central bank, the Monetary Authority of Singapore (MAS), granted the institutional grade exchange regulatory approval in principle.That Capital Markets Services (CMS) license is now on the cusp of full license approval from MAS. Furthermore, the firm is also working towards obtaining a Recognised Market Operator license.These regulatory milestones all feed into AsiaNext’s overall goal, which is to offer a service which can bridge the gap between traditional finance and the digital assets space. In building out that offering, Marek Socha, Head of Corporate Development at SIX Group, said in an interview last year that important partnerships would be established by AsiaNext. No doubt accessing Colt’s service offering with this latest partnership is another step for the firm in reaching its objective.