MiCA may force crypto firms into Middle East relocation

The Securities Commission Malaysia (SC), the statutory body tasked with regulating and developing capital markets within the Southeast Asian nation, has published a consultation paper in an effort to garner public feedback on potential enhancements to its crypto regulatory framework. In a press release published to its website on June 30, the SC claimed that its proposals seek “to enhance competitiveness of Malaysia’s regulated digital asset market, improve investor protection and strengthen the resilience and integrity of [Digital Asset Exchange] operators.”Photo by Vlad Shapochnikov on UnsplashEasing listing requirementsIn the event that the proposals are adopted, one key change would see a liberalization of the listing requirements for digital assets. Where certain key eligibility criteria have been met, the regulator would allow the listing of digital assets on digital asset exchanges without prior SC approval. The regulator stated that it wants to make this change in order to speed up the time taken to get digital assets to market as they emerge. By setting out additional criteria, there will be greater exchange operator accountability. Exchange operators would bear responsibility for listing tokens in compliance with the requirements set out by the regulator.  Assets could only be listed once those assets and the underlying protocol and network had undergone security audits which had been carried out by an independent and qualified blockchain security auditor, with the audit results made public.  For the purposes of the “Liberalised Listing Framework,” the asset must have been trading on a Financial Action Task Force (FATF)-compliant virtual asset service provider (VASP) platform for a minimum of one year. The regulator believes that easing the listing requirements will result in a broader digital asset product offering being made available in Malaysia. Last month, Thailand’s Securities and Exchange Commission (SEC) started a public consultation process aimed at revising token listing rules. Coin listing processes have also come under scrutiny from the authorities in South Korea recently. Segregating client assetsAmong the proposals is a plan to oblige exchange platforms to properly segregate client assets from operational funds and assets held by the exchange business. In recent years, many failed crypto exchange platforms, most notably FTX, got into difficulty by co-mingling customer funds with operational funds. Furthermore, the regulator doesn’t want any cross-over of assets between the local exchange operator and any overseas affiliate companies it may have.The SC stated that it is cognizant of recent global exchange failures, which has led it towards further enhancing crypto exchange operational governance and controls. It suggests that only 10% of client assets should be held by a Malaysian exchange in hot wallets, with the remaining 90% held in cold or offline wallets. The SC said that it welcomes feedback from members of the various stakeholder groups on the proposals outlined. The public consultation period runs from June 30 through Aug. 11.  Malaysia is expected to have 4.74 million crypto users by 2026. That would equate to 13% of Malaysians using crypto by then.

Korea’s Changwon City Boosts Local Art Scene with NFTsOn Monday, South Korea’s Changwon City announced its plan to support local artists by promoting their work through non-fungible tokens (NFTs). This initiative aims to help artists adapt to the rapidly changing fine art industry, driven by state-of-the-art technology, and stay current with the latest trends.NFT ART in ChangwonThis project “NFT ART in Changwon” came to life after the city partnered with MetaGalaxia, a Korean NFT marketplace, earlier this year.Jung Hyun-sub, head of the city’s culture, tourism, and sports division, has encouraged local citizens to participate in the project and emphasized the city’s commitment to fostering the NFT industry, starting with a focus on local artworks.15 artistsThe application process for the project will run from May 1 to May 30, and 15 artists will be selected. Eligible applicants must be Changwon residents who have either majored or are currently majoring in fine arts or have publicly exhibited their artwork.Artists can submit various forms of artwork that can be turned into NFTs, including paintings, photographs, and videos. Those selected will benefit from registration as NFT artists on MetaGalaxia, digitization of their original artworks into NFTs, and promotion of their artworks and profiles across various social media platforms.© Pexels/Dom J

Haechi Labs Joins Hands with Oasys for Entry into Japanese MarketHaechi Labs, a South Korean blockchain service and digital wallet provider, announced Thursday that it has signed a business deal with Japanese blockchain gaming platform Oasys to establish a footing in the Japanese market.Photo by Erika Fletcher on UnsplashFostering collaborationThrough the new partnership, the companies plan to share their technical expertise and promote mutual growth. In particular, Haechi Labs’ digital wallet, Face Wallet, will be onboarded on the Oasys mainnet. This integration will allow Oasys users to easily access Web3 services using their existing social media accounts. Face Wallet supports login through various social media platforms such as Google, Discord, Twitter, Facebook, Apple, and Kakao, thereby reducing entry barriers for users who are new to Web3.Haechi Labs will also provide a software development kit (SDK) for Face Wallet, enabling game developers operating their games on the Oasys platform to integrate the wallet into their services.“We expect that Face Wallet’s integration into the Oasys mainnet will streamline the onboarding process for Web3 games,” said Moon Geon-gi, CEO of Haechi Labs. “We will continue to pursue close cooperation with various companies in the future.”Gaming focusOasys’ multi-layered blockchain network is centered around gaming, consisting of a built-in L2 scalability solution. It has worked with various major gaming companies such as SEGA, Ubisoft, Bandai Namco, Nexon, and Netmarble, who participate in the network as validator nodes.