StashAway opens access to Fidelity crypto ETFs in Malaysia

Recent developments in the cryptocurrency market reveal that mainland Chinese citizens will face restrictions in purchasing Bitcoin and Ether exchange-traded funds (ETFs) in Hong Kong. This restriction stems from China's ban on crypto transactions, which has been in effect for several years. Bloomberg data analyst Jack Wang highlighted this issue, indicating that the upcoming launch of spot Bitcoin and Ether ETFs in Hong Kong will not facilitate market access for investors in mainland China.Photo by Traxer on UnsplashSpot Bitcoin and Ether ETFs approved in Hong KongDespite Hong Kong's approval of spot BTC and ETH ETFs, major Chinese asset managers such as China Asset Management, Harvest Global Investments, and Bosera have established these products through their Hong Kong subsidiaries. However, despite their close ties with mainland China, these ETF issuers are unable to offer Bitcoin or Ether exposure to investors within the jurisdiction due to regulatory constraints. Exclusion of mainland Chinese investorsWang emphasized during a Bloomberg webinar that mainland Chinese citizens will not be able to participate in these ETFs, citing a statement from the Chinese State Council issued in September 2021. This statement prohibits financial institutions from engaging in crypto-related transactions, including account creation, fund transfers, and clearing services. As a result, Chinese investors are unlikely to engage with these products in the short term. Impact on regulatory environment and market accessWang expressed skepticism about the potential impact of spot Bitcoin and Ether ETFs in Hong Kong on the regulatory environment in mainland China. He stated that the launch of these ETFs is unlikely to open the crypto market to Chinese investors in the foreseeable future. Thomas Zhu, head of digital assets at China Asset Management, noted that the eligibility of mainland Chinese investors to acquire crypto ETFs in Hong Kong depends on forthcoming regulatory modifications. He highlighted the Mainland-Hong Kong Stock Connect, which allows mainland investors to trade eligible Hong Kong stocks and ETFs since 2014. Comparison with U.S. Bitcoin ETF marketDespite optimism surrounding the launch of spot crypto ETFs in Hong Kong, Bloomberg analyst James Seyffart drew attention to the significant difference in market size between the U.S. and Hong Kong ETF markets. Seyffart pointed out that Bitcoin ETFs in the United States have more assets than all ETFs in Hong Kong combined, emphasizing the vast disparity in market scale and impact. As the launch date for spot Bitcoin and Ether ETFs in Hong Kong approaches, stakeholders continue to monitor regulatory developments and market dynamics closely. 

BLOX, the Malaysian Web3 firm, has forged a strategic partnership with AsiaPay, a payment processor and gateway solution provider in Asia, focused on crypto payments. Memorandum of understanding (MOU)According to a recently published press release, the collaboration has been formalized through a memorandum of understanding (MOU) and aims to collectively explore and develop cryptocurrency digital payment solutions tailored for the Malaysian market. As global consumers increasingly gravitate towards the most frictionless payment methods, cryptocurrencies are gaining significant traction. However, the seamless integration of cryptocurrencies into day-to-day transactions requires the support of adept payment service providers.Photo by Esmonde Yong on UnsplashStablecoin potentialDespite the burgeoning popularity of cryptocurrencies, the inherent volatility in their prices poses a considerable challenge. To address this challenge, stablecoins have emerged as a viable solution. The adoption of stablecoins has gained momentum, particularly in the business-to-business (B2B) segment, where the efficiency of blockchain-based payments and instant settlement can be harnessed without being hampered by the uncertainties of price fluctuations. It is within the area of stablecoins that BLOX can lend support, given that the entity is responsible for the first Malaysian ringgit-denominated stablecoin (MYRC). Ethan Chung, CEO and Co-Founder of BLOX, expressed enthusiasm about the partnership, stating:“I’m excited to announce our partnership with AsiaPay, enabling Malaysian merchants to effortlessly accept crypto payments without the need for technical expertise. Empowering businesses, simplifying transactions.” Regulatory sandboxThe crypto payment exploration, which will be undertaken by the two companies, is being enabled under the auspices of a regulatory sandbox environment provided by Malaysian central bank Bank Negara Malaysia. Loo Tak Kheong, Country Head and Director at AsiaPay Malaysia, emphasized the added value this collaboration brings to their payment solutions. He said:“At AsiaPay, we provide payment acceptance solutions with multi-currency, multi-lingual, multi-card, and multi-channeled payment capabilities, which we believe by adding an additional payment method via crypto, will further enhance the value-add service to our Merchants and Partners in the payments ecosystem.” AsiaPay operates throughout the Asian region, headquartered in Hong Kong but with a local corporate entity also established to serve the Malaysian market. Malaysia has shown interest in harnessing blockchain for the purposes of international trade and payments. Last year the Southeast Asian country’s Prime Minister had expressed interest in decreasing its dependency on use of the U.S. dollar. Under the guidance of the country’s central bank, Malaysian banks have explored the use of blockchain for the purpose of trade finance. The country had expressed interest in a central bank digital currency (CBDC) in a financial sector blueprint it had previously published, mapping a way forward from 2022 to 2026. The same document deems decentralized cryptocurrencies like bitcoin to be “non-backed digital assets.” Previously the country’s deputy finance minister had said, “cryptocurrencies like Bitcoin are not suitable for use as a payment instrument due to various limitations.” This strategic alliance between BLOX and AsiaPay reflects the ongoing evolution of payment systems, positioning both companies at the forefront of the exploration of crypto-as-a-payment means in Malaysia.

Saudi Arabia’s NEOM Forms $50M Animoca Brands PartnershipHong Kong’s Animoca brands, a gaming and metaverse venture capital firm, is embarking on a partnership with Saudi Arabia’s NEOM Investment Fund, focusing on pioneering Web3 initiatives.Animoca announced the initiative via a statement published to its website on Monday. NEOM is an ambitious project aiming to create a futuristic urban oasis in northwest Saudi Arabia, serving as a nexus for technology, commerce, entertainment, and tourism. It is planning to invest $50 million in Animoca.Photo by Hala AlGhanim on UnsplashDeveloping Web3 service capabilitiesThis collaboration will see Animoca harness its expertise to develop Web3 service capabilities with broad global applications in tandem with NEOM, aligning with NEOM’s vision of becoming a cutting-edge tech hub of the future.Animoca Brands has been a prominent player in the Web3 investment arena for several years. In July 2022, the company’s valuation soared to $6 billion, with backing from notable entities such as Singapore’s state investment fund, Temasek. Despite its ambitious goal to secure $2 billion for its metaverse fund in November of the same year, those expectations were significantly tempered following the FTX collapse. Consequently, in March, Animoca revised its target to a more modest $800 million.In-house market makingA report by The Block on Friday revealed that Animoca has been making efforts to pitch an in-house market making service to fledgling Web3 businesses within its portfolio. That service has been presented by the company to more than 400 startup projects in which it has been an investor over recent months.The key market makers in the crypto space include Wintermute, Keyrock, and GSR. This move by Animoca potentially puts Animoca in direct competition with these primary crypto-sector market makers. An in-house digital asset team has been tasked with offering the service. An Animoca spokesperson stated:“Its primary role, much like the treasury teams in many large corporations, is to optimize the utilization of the company’s balance sheet. The team does conduct market-making to ensure there is enough buy/sell liquidity for certain tokens, which is similar to the function that third-party market makers conduct, except that we choose to perform this in-house for scale and efficiency.”Saudi diversificationAs part of its Vision 2030 initiative, Saudi Arabia has been looking to diversify away from its predominantly oil-based economy. In an interview last month, Animoca Brands Founder Yat Siu outlined that the Middle Eastern country is embracing new technologies such as artificial intelligence (AI) and blockchain, encompassing blockchain-based gaming and Web3.In July it emerged that the Saudi Central Bank (SAMA) and the Hong Kong Monetary Authority (HKMA) were looking to extend the level of collaboration between the two territories relative to international payments and tokenization.This renewed interest from state-backed funds in Animoca suggests a potential shift in the Web3 venture capital landscape, coinciding with broader indications of a thaw in the crypto winter. The collaboration with NEOM and the injection of $50 million underscore the growing recognition of Web3’s potential, cementing Animoca Brands’ position as a key player in the ever-developing Web3 space.