Japan’s PM holds off on supporting Bitcoin as reserve asset

Bitstamp, regarded as the longest-running cryptocurrency exchange in the business, declared on March 6 that it has obtained in-principle approval for a license to function as a Major Payment Institution (MPI) from the Monetary Authority of Singapore (MAS).Photo by Zhu Hongzhi on UnsplashFirst major Euro exchange in SingaporeThis preliminary approval, a precursor to a full-fledged license for operation in Singapore, marks a significant milestone for Bitstamp towards offering digital payment token services within the city-state. According to the exchange's press release, it's the first crypto trading platform with a substantial presence in the European Union (EU) to secure such approval from MAS. The nod from Singapore’s financial regulator arrives amidst notable regulatory strides in the crypto domain, including the European Union’s rollout of the Markets in Crypto-Assets (MiCA) framework and the green light given by the U.S. for Bitcoin ETFs. Focusing on AsiaBitstamp's strategic focus on the Asia Pacific region, with Singapore as its central hub, underscores its focus in delivering services to both institutional and retail clientele across the region. The firm’s intent in this regard became clear in August of last year when Bitstamp sought capital funding to enable it to extend the platform’s reach into various markets across Asia. Whilst the company’s origins can  be traced back to Slovenia, it has since developed further ties with Asia. In 2018, the company was acquired by NXMH, a subsidiary of South Korea’s NXC Corporation. The same holding company owns Korean crypto exchange Korbit. Compliance strategyWhile the licensing is quite the achievement, the company already boasts a robust regulatory track record, surpassing the 50-license mark across key markets such as Luxembourg, the Netherlands, Italy, Spain, France the United States (with coverage in 40 states including New York, Washington, Texas and Florida) and the United Kingdom. In its press release the company referred to its ever-growing licensing collection, outlining that “compliance and regulation [are] at the heart of all operations.” Leonard Hoh, Bitstamp's APAC General Manager, lauded Singapore's proactive stance in establishing a regulatory framework for crypto exchanges, positioning the city-state as a pivotal player in the digital assets landscape. Singapore has already granted full licenses to several crypto service providers, including Blockchain.com, Circle, Coinbase and Ripple. In late 2023, Bitstamp initiated talks with three major European banks regarding the potential introduction of cryptocurrency services in 2024. This signals a broader trend within the EU, where the crypto regulatory initiative, MiCA, is smoothing the path for traditional financial institutions to venture into the digital assets realm. Robert Zagotta, Bitstamp’s Chief Commercial Officer, highlighted the surge in interest surrounding its “Bitstamp-as-a-Service” offering, especially within European circles. This service furnishes a white-label licensing framework, coupled with requisite technology, to aid banks and fintech entities in facilitating cryptocurrency transactions for their clientele. However, the regulatory landscape isn't as welcoming in India, where the country’s Financial Intelligence Unit (FIU) urged the Ministry of Electronics and Information Technology to block the URLs of nine major global crypto exchanges, including Bitstamp, in late 2023. 

Binance Takes P2P Service Measures in Response to Sanctioned Russian BanksGlobal crypto exchange Binance has removed the option for users to conduct transactions via sanctioned Russian banks on its peer-to-peer (P2P) platform, a decision that comes on the heels of a Wall Street Journal exposé published earlier this week, shedding light on the platform’s involvement in facilitating the movement of funds for Russian users.Previously, Binance’s peer-to-peer service featured five Russian banks under sanctions as a method for ruble transfers between users. However, the company swiftly acted to address potential compliance concerns. Fittingly, this latest news was also broken by the Wall Street Journal on Friday.Dmitry Sidorov on PexelsSailing too close to the windWhen approached regarding the omission of these banks, a Binance spokesperson stated: “We regularly update our systems to ensure compliance with local and global regulatory standards. When gaps are pointed out to us, we seek to address and remediate them as soon as possible.”The Wall Street Journal’s article outlined how Binance’s peer-to-peer platform facilitated ruble-to-crypto trades that frequently involved the sanctioned Russian banks, with Rosbank and Tinkoff Bank being prominent examples.These trades often utilized layers of intermediaries to convert funds from these banks into Binance balances, as detailed by various company resources, user screenshots, and messages in official chat groups. Despite these revelations, Binance’s exchange had continued to handle significant volumes of ruble trading, according to data compiled by digital asset research firm CCData.US DoJ probeBinance’s activities in Russia could potentially contribute to its ongoing legal challenges in the United States. The US Justice Department (DoJ) has been probing the company’s actions for potential violations of American sanctions on Russia. In response to such concerns, the Binance spokesperson emphasized:“Binance aims to diligently comply with the global sanctions rules and enforces sanctions on people, organizations, entities, and countries that have been blacklisted by the international community, denying such actors access to the Binance platform.”WorkaroundsTraders, however, had reportedly found workarounds to the bank removals, as observed in the official Telegram chat group for Russian clients. Many shared that they could still engage with sanctioned banks by selecting alternative payment methods and then manually inputting their Rosbank or Tinkoff bank details.Earlier this year, an investigative report by CNBC alleged that employees of the company had told it that Binance staff regularly helped Chinese customers to bypass Know Your Customer (KYC) controls in order to access the platform. More recently, another report, once again by the Wall Street Journal, found that business in China was booming, which surprised many given that China banned crypto trading within the country in 2021.It’s apparent that the company is reacting to regulatory and legal pressures in taking the decision to make these changes to its P2P service. Perennial crypto critic US Senator Elizabeth Warren took to X (formerly Twitter) on Friday, stating:“I rang the alarm about sanctions evasion by Russia using the crypto platform Binance — and urged [the DoJ] to investigate potentially false statements it made to Congress. We need stronger crypto regulations to rein in illicit finance.“

Japanese Bitcoin treasury company Metaplanet, whose shares are listed on the Tokyo stock exchange (3350/TYO), has taken an important step towards its goal of holding 210,000 BTC by 2027. ‘Asia’s largest-ever equity raise’The firm’s CEO, Simon Gerovich, took to the X social media platform on June 6 to outline details of what he termed “Asia’s largest-ever equity raise.” Gerovich stated that Metaplanet had raised 770.9 billion yen ($5.4 billion) by means of moving strike warrants, implicating 555 million shares. Moving strike warrants are a type of equity warrant through which the strike price changes over time. Photo by Cullen Cedric on UnsplashGerovich claimed that the warrants were issued at a premium to the market due to Metaplanet’s “high volatility and deep liquidity.” The Metaplanet CEO stated that the firm is targeting 100,000 BTC by the end of 2026 and 210,000 by the end of 2027. On June 2, the firm announced that it had acquired its latest tranche of Bitcoin, adding another 1,088 BTC to its corporate treasury. The company paid an average Bitcoin unit price of 15,519,019 yen ($107,000). Metaplanet has adopted the treasury playbook first pioneered by Michael Saylor’s Strategy (formerly MicroStrategy), acquiring the leading crypto asset through a combination of equity issuance, debt financing and opportunistic buying.  Russell Okung, a former professional American football player and well-known Bitcoin proponent, took to X on June 6 to highlight that Saylor “lit the match” through Strategy in the United States.  Okung stated: “Metaplanet just launched the rocket in Asia. When capital moves, narratives follow.”He added that “Metaplanet didn’t just buy Bitcoin. They’re directing global attention toward Japan.” Both Metaplanet and Strategy have appealed to investors who are otherwise not in a position to gain exposure to Bitcoin directly, either as a result of regulatory issues or concerns with regard to the custody of the digital asset.  Corporate treasuries adopting BitcoinIn addition to these companies who have led first with a Bitcoin treasury as their primary attraction, other corporates have added Bitcoin to their corporate treasuries while maintaining their focus on other business activities.  Announcements have come thick and fast over the course of recent weeks, particularly in the Asian region.  A number of Nasdaq-listed companies, including Hong Kong-based Reitar Holdings, Indonesian fintech firm DigiAsia, Malaysia-based Treasure Global and South Korea-based K Wave Media, have all announced the addition of Bitcoin to their corporate treasuries.  Metaplanet’s new funding round will put it on track to achieve the goal of obtaining 210,000 BTC by 2027, equating to approximately 1% of the entire Bitcoin supply. The Japanese firm’s shares have risen in price by over 275% since the beginning of this year. According to BitcoinTreasuries.net, Strategy remains the largest corporate treasury holder of Bitcoin with 582,000 BTC. It’s followed by MARA Holdings, Twenty One, Riot Platforms, Galaxy Digital Holdings and CleanSpark. Tesla, Hut 8 Mining Corp and Coinbase Global also feature prior to Metaplanet which comes in tenth place.