Report on Hong Kong’s fintech sector reveals solid blockchain growth

Japan is moving aggressively to cement its status as a global hub for digital assets. A decisive election victory for the ruling party has cleared the legislative runway for sweeping crypto tax reforms, while the country's largest financial institutions are simultaneously preparing to test blockchain-based securities trading. For global investors, these developments signal a deepening integration of blockchain technology into Japan's traditional financial infrastructure.Photo by PJH on UnsplashElection win seen as pro-cryptoPrime Minister Sanae Takaichi’s Liberal Democratic Party secured a majority in the recent general election. According to local media outlet CoinPost, the digital asset industry views this political stability as a positive signal, as pro-crypto initiatives such as a tax overhaul might otherwise have faced legislative obstacles. Currently, crypto profits in Japan are classified as miscellaneous income and taxed at punitive rates of up to 55%. Under the proposed framework, digital assets would be reclassified under the Financial Instruments and Exchange Act and become subject to a flat 20% capital gains tax, bringing them in line with traditional equity investments. However, officials have noted that full implementation will require a preparation period of approximately two years to ensure exchanges and self-regulatory organizations can fully adapt to the new legal framework. Additionally, Prime Minister Takaichi’s expansionary fiscal policies are expected to drive risk-on market sentiment. For foreign investors, any potential yen depreciation resulting from these macroeconomic policies could inflate yen-denominated crypto prices, creating unique arbitrage opportunities. Brokerages pilot blockchain tradingSeparately, according to a Nikkei report, Japan’s top brokerages—Nomura and Daiwa—are partnering with the nation’s three megabanks (Mitsubishi UFJ Financial Group, Sumitomo Mitsui, and Mizuho) to launch a blockchain-based securities trading platform, in a bid to modernize the country’s capital markets. The project will allow investors to buy and sell stocks, government and corporate bonds, and mutual funds using fiat-pegged stablecoins. The pilot is slated to begin this month, with a commercial rollout targeted for the coming years. This stablecoin initiative bypasses traditional exchange hours, enabling continuous trading and real-time settlement. While the U.S. recently transitioned to a next-day settlement cycle, moving to instant blockchain settlement would allow Japan to leapfrog Western markets and eliminate time-zone friction for foreign capital. The move aligns with a broader push by Japanese corporate giants to utilize stablecoins for both wholesale and retail transactions. Regulators tighten cybersecurityIn a more recent report, CoinPost noted that the Financial Services Agency has drafted new guidelines aimed at upgrading the cybersecurity posture of domestic crypto exchanges, as part of efforts to safeguard Japan’s rapidly expanding digital economy. The regulator cited a shift in the global threat landscape, warning that cold wallets alone are no longer sufficient against recent cryptocurrency breaches, which have involved hackers using sophisticated social engineering tactics and third-party partners as entry points for attacks. The proposed defense strategy centers on more rigorous security requirements, enhanced industry collaboration, and government-led stress testing. By year-end, all virtual asset service providers will be required to conduct formal cybersecurity self-assessments, while facing stricter regulatory scrutiny of third-party audits and security personnel. Additionally, regulators plan to conduct real-world penetration testing on select firms and share the findings across the sector to strengthen security overall. 

SK C&C to Spearhead Establishment of Korea’s First Alternative Trading SystemSK C&C, the information communications technology arm of South Korean conglomerate SK Group, is set to launch the country’s first Alternative Trading System (ATS) — a securities trading venue that is more loosely regulated than an exchange — in the second half of next year.The firm announced on Wednesday that it will commence the multilateral trading system construction project for Nextrade, a corporation dedicated to preparing the ATS.Photo by Kanchanara on UnsplashCollaborative effort of securities institutionsNextrade was initiated by seven securities firms, including the Korea Financial Investment Association, and was jointly established by 34 participating institutions, including 19 securities companies, three securities-related institutions, and four tech companies in November of last year.SK C&C in particular has been working with Nextrade since 2019. When the corporation was still a consultative body of securities firms, the SK subsidiary was in charge of consulting on various matters regarding the establishment of the ATS and functional system requirements.Establishing a solid foundationThe aforementioned construction project aims to establish a multilateral trading system and an operation and management system to support the trading, brokerage, and agency functions of listed securities and depositary receipts on the ATS, which Nextrade will proceed with upon its official approval in the second half of next year. SK C&C will take on a major role in leading this task.“Based on our digital IT service capabilities that we have accumulated within the financial sphere, we will establish an efficient and reliable multilateral trading system that is on par with regular exchanges,” said Kim Nam-sik, head of the SK C&C Financial Digital2 Group.Besides facilitating multilateral trading, SK C&C will develop an information distribution system that processes investment information in connection with the Korea Exchange and the Korea Securities Depository, as well as a trading support system responsible for product information management, trading statistics, and administration.Trading after hoursThe ATS will allow trading past normal trading hours, which are usually from 9 AM to 3:30 PM — an especially attractive selling point for buyers and sellers. This will be made possible by compiling product information based on closing prices after the market closes, which will create an environment that allows for trading after hours.This service will not only be convenient for office workers but also help them refer to official announcements and the status of overseas markets to make more informed decisions, SK C&C said.Securities that can be traded after hours will be limited to listed stocks and depository receipts on the Korea Exchange for the time being, but SK C&C is reportedly looking into allowing trading of security tokens, non-security virtual assets, and NFTs.Ensuring uninterrupted operationsNotably, there will also be a Disaster Recovery Center, which will serve to protect the ATS’ major systems and data assets and ensure business continuity. A data backup system will be set up to reduce backup time and swiftly recover from any failures in case of potential security threats.Furthermore, the ATS plans to introduce new types of orders to enhance investor benefits in the domestic capital market, setting it apart from the Korea Exchange.

MARBLEX Introduces New Update to Multichain ServiceSouth Korean gaming developer Netmarble announced last Friday that its blockchain subsidiary, MARBLEX, has updated its multichain service Warp.Photo by Shubham Dhage on UnsplashCross-chain accessibilityWarp is a bridge service that enables the exchange between its native token, MARBLEX (MBX), and bridge token, MBXL, while allowing MBX tokens to move across blockchain networks. With this update, BNB Chain users can now access services within the MBX ecosystem, including games and NFTs. The recent update is expected to attract an influx of BNB Chain users after MARBLEX previously entered into a strategic partnership with the network in February to expand its multichain ecosystem.Furthermore, MARBLEX intends to continue applying its convenient user-friendly service approach by maintaining its existing system for gas fee payments.Celebratory eventsMARBLEX is hosting special events worth a total of $240,000 to mark the new update, including an offering of liquidity pools in two forms — BNB-MBX pairs and USDT-MBX pairs — on the decentralized exchange PancakeSwap. The company also plans to reward MBX for staking in Syrup Pools within PancakeSwap, which are special staking processes where users can earn free tokens.The developer also plans to hold an online community event for service users.