Standard Chartered joins with local partners in Hong Kong to launch stablecoin

UAE’s Royal Office Visits Korea to Further Security Token Collaboration with AIITONEAIITONE, a Korea-based augmented reality firm specializing in security tokens, invited journalists to showcase its strategy to foster business collaborations between South Korea and the United Arab Emirates (UAE) on the occasion of the Korean visit of the Private Office of His Highness Sheikh Ahmed Bin Faisal Al Qassimi.Photo by Ethan Brooke on UnsplashPrivate Office’s return visitThe Private Office is a Dubai-based corporate conglomerate that operates businesses in various areas including real estate, energy, and finance. This visit by the Private Office marks a return visit following AIITONE’s visit to the UAE in July.The conference took place at a hotel in Gangnam, Seoul, and was attended by Lee Jin-yeop, CEO of AIITONE; Bruce Jeong, Chairman of Middle East Investment; and H.H. Sheikh Ahmed Bin Faisal Al Qassimi.Security tokens, CBDCs, smart defenseChairman Jeong, leading AIITONE’s global initiatives, said that their primary endeavor is to set up a Korean branch of the Royal Office. This branch will function as an international business hub, facilitating collaborations across three key sectors: security tokens, central bank digital currencies (CBDCs), and smart defense ventures.The event also featured presentations by AIITONE officials who introduced the company’s focus areas.Kang Man-soo, who leads AIITONE’s defense unit, highlighted the company’s technical expertise in maintenance training equipment, interactive electronic technical manuals, and integrated system support. He pointed out that AIITONE has been actively involved in the development of technical manuals and training simulators for various defense assets, including warships, guided weapons, and fighter aircraft. Kang emphasized that AIITONE’s strategic partnerships with Korean defense firms have propelled their engagement in initiatives aimed at exporting these products to countries such as Indonesia, Malaysia, and Poland.Lee Joo-hyung, the head of AIITONE’s extended reality (XR) content division, revealed the company’s plan to create portable products that can replicate the physical sensations of the real world, including sensations like physical contact and heat. Additionally, Lee introduced MOUM, a metaverse platform that features blockchain-powered security functions and generative artificial intelligence (AI) capabilities.Park Sang-il, who is at the helm of the firm’s security token project, showcased AIITONE’s comprehensive security token platform, which enables users to both issue and distribute security tokens. Notably, the platform is compatible with hyperledgers Besu and Fabric.Since arriving in Korea last Wednesday, the Royal Office has met with representatives from Standard Chartered Bank Korea and lawyers from law firm Kim and Chang, as well as lawmaker Yang Hyang-ja. Additionally, the Royal Office made a visit to smart farms located in South Jeolla Province.H.H. Sheikh Al Qassimi expressed a high regard for South Korea, acknowledging its beautiful natural landscapes and significant economic development. He underlined that this visit serves as an opportunity for the Royal Office to strengthen cooperation between UAE companies and their Korean counterparts, further fostering economic exchanges between the two countries.

Korea Exchange sets the stage for security token tradingStarting next year, South Koreans may have the opportunity to trade security tokens, as the Korea Exchange (KRX), the sole securities exchange operator in the country, has officially begun preparations to establish a security token market. The Busan Digital Asset Exchange (BDX), slated for launch next year, is expected to play a pivotal role in spearheading the growth and development of this emerging security token market.Photo by Tierra Mallorca on UnsplashSeeking approval from financial regulatorsAs reported by local news outlet Busan Ilbo, KRX applied to the FSC last month for registration as an innovative financial service under the financial regulatory sandbox scheme. On Nov. 19, the FSC approved the creation of pilot markets for investment contract securities and non-cash trust beneficial certificates. KRX’s recent initiative is a follow-up to this development. The financial regulator is set to make a final decision after holding a main committee meeting to review KRX’s application.Investment contract securities and non-cash trust beneficial certificates represent two distinct types of security tokens. Investment contract securities provide a means for fractional investments in real-world assets (RWAs). This can include a diverse range of assets such as artworks, music copyrights, beef and carbon credits, allowing investors to own a portion of these assets. On the other hand, non-cash trust beneficial certificates function as secondary investment instruments. These certificates enable individuals to invest in financial products that themselves have invested in security tokens, offering an indirect pathway to participate in the security token market.Fractional investments on the horizonVarious industries are poised to benefit from the emerging digital market, especially platforms focused on fractional investment in artworks. Companies like Yeolmae Company, Art Together and Seoul Auction Blue are keen on this opportunity and have applied to the FSS for permission to register security tokens. Upon receiving regulatory approval, these platforms plan to accept subscription requests, enabling investors to participate in the art market in a more accessible way.The development of security token markets is expected to positively impact BDX, which is currently seeking an operator. Initially, when BDX’s operation plan was unveiled in September, it excluded security tokens due to regulatory constraints. However, with KRX now involved, it’s more probable that the Busan exchange will feature security tokens as major trading assets. Experts believe the success of these token exchanges will largely depend on the quality and appeal of the underlying assets.A local securities industry official emphasized the significant role of the security token market in enhancing the stature of Busan as a blockchain hub. The growth of this market is seen as pivotal in boosting the value and utility of BDX. The official noted that BDX’s appeal to investors would increase if it offered a diverse range of underlying assets or unique security tokens. This development could mark a significant turning point for Busan in the blockchain industry.

Bitzlato co-founder to pleads guilty in US to illicit funds processingAnatoly Legkodymov, the co-founder and majority owner of Hong Kong-registered virtual currency exchange Bitzlato, entered a guilty plea in a U.S. court on Wednesday in relation to illicit funds transfer activity.Photo by Max Sandelin on UnsplashNew York court appearanceAccording to a Department of Justice press release, Legkodymov, a Russian national, appeared before U.S. District Judge Eric Vitaliano for a “criminal cause for pleading,” signaling a guilty plea.Legkodymov, 41, was arrested in Miami on Jan. 17 and has been held at the Metropolitan Detention Center (MDC) in Brooklyn since then. U.S. authorities accused him of processing approximately $700 million in illicit funds through Bitzlato, a platform headquartered in Hong Kong.The charges related to operating the platform as an unlicensed money exchange business. Allegedly, he engaged in significant cryptocurrency swaps with Hydra Market, described as a marketplace involved in drugs, stolen financial information and money laundering services.United States Attorney for the Eastern District of New York, Breon Peace stated:“Legkodymov’s guilty plea today confirms that he was well aware that Bitzlato, his cryptocurrency exchange, was being used like an open turnstile by criminals eager to take advantage of his lax controls over illicit money transactions.”The Department of Justice maintained that Bitzlato becoming “a haven for criminal proceeds and funds intended for use in criminal activity” was as a result of its “deficient know-your-customer (KYC) procedures.”Website taken downBitzlato’s website has been replaced by a notice stating that the service was seized by French authorities as part of an international law enforcement action coordinated with U.S. and German law enforcement shutting down Hydra Market in April 2022.This guilty plea is the latest development in U.S. law enforcement’s broader efforts to crack down on fraud and illicit financial activities within the cryptocurrency markets. In recent cases, FTX founder Sam Bankman-Fried was convicted for stealing billions from customers, while Binance agreed to a $4.3 billion settlement, with CEO Changpeng Zhao (CZ) pleading guilty to violating U.S. anti-money laundering laws. Binance was identified as one of Bitzlato’s top counterparties by U.S. authorities.Russia calls for Legkodymov’s releaseDespite calls from Russia’s embassy in Washington for Legkodymov’s release and an embassy visit to him in jail, the U.S. State Department confirmed that Russia rejected a proposal for the release of two Americans, including Wall Street Journal reporter Evan Gershkovich. This follows Russia’s denial of a U.S. embassy request to visit Gershkovich. The diplomatic exchanges underscore the international dimension of the case and the geopolitical tensions surrounding the detention of individuals in both countries.As U.S. law enforcement continues its efforts to combat cryptocurrency-related crimes, the anticipated guilty plea of Bitzlato’s co-founder highlights the regulatory scrutiny and consequences faced by those involved in illicit financial activities within the crypto industry.