Avalon integrated with Bybit to offer Bitcoin yield

Korea to Ban Virtual Asset Deposit Services from Next JulyDuring a recent criminal law seminar held at the Supreme Prosecutors’ Office, Park Min-woo, Director of the Capital Markets Bureau at the South Korean Financial Services Commission (FSC), underscored that starting next year, virtual asset service providers (VASPs) will no longer be permitted to offer deposit and management services for virtual assets. That’s according to a report by local crypto news outlet Digital Asset.This is seen as a response to the suspension of virtual asset deposits and withdrawals carried out by virtual asset yield platforms Haru Invest and Delio a few months ago.Photo by Mathew Schwartz on UnsplashLegal backgroundDirector Park referred to Article 7, Paragraph 2 of the Virtual Asset User Protection Act, clarifying that the intention behind this provision is to ensure that VASPs have the ability to fulfill asset withdrawal requests, even in the scenario where all their customers make such requests. This Act is scheduled to go into effect in July of next year, and Article 7 prohibits VASPs from entrusting customer assets to third parties.Deposit service providers receive cryptocurrency deposits and then distribute the resulting yields to their customers. In a bull market, these entities can manage yields on their own. However, in a flat or bear market, these asset managers may face challenges in paying yields unless they can generate profits by handing over customer assets to external custodians.Signs of giving upIn fact, centralized finance (CeFi) company HeyBit made an announcement last month, stating that it will discontinue its virtual asset deposit service starting from October 2. They cited this specific provision as the reason for their decision.Fraud chargesBoth Haru and Delio have been indicted by the Seoul Southern District Prosecutors’ Office on fraud charges.As an unregistered VASP, Haru suspended its deposit and withdrawal services on multiple occasions in June, causing substantial financial losses to numerous investors. This suspension was triggered by significant losses incurred at B&S Holdings, another unregistered entity to which Haru had entrusted virtual assets.Similarly, Delio, although registered, entrusted a considerable amount of virtual assets to Haru and Traum Info Tech but was unable to recover them.

Hong Kong court grants trademark injunction against HuobiThe Hong Kong Special Administrative Region High Court has resolved a trademark dispute between X-Spot Global Limited and Huobi Global Limited, ruling in favor of X-Spot.Back in June, X-Spot alleged that Huobi Global infringed on its trademark rights related to the “Huobi” name. In the legal process which followed, the court sided with X-Spot, compelling Huobi Global to cease using the “Huobi” trademark or any similar name or logo in Hong Kong.Photo by Tingey Injury Law Firm on UnsplashPotential confusionThe court’s official judgment highlighted concerns about potential confusion among the public and industry professionals arising from Huobi Global’s use of the “Huobi” trademarks. It emphasized that such confusion could lead people to believe that X-Spot Global, as the registered trademark owner, is actively engaged in cryptocurrency business associated with the trademark. In response, the court dismissed Huobi Global’s plea to revoke the service order and halt negotiations, also instructing the covering of X-Spot Global’s legal expenses.Post-acquisition conflictThe background to this dispute originates in the acquisition of Huobi Global last year. It’s widely believed that TRON blockchain network founder Justin Sun purchased the exchange for $1 billion although Sun has subsequently suggested that he is just an advisor to the crypto exchange business. The acquisition was made by About Capital Management, an entity associated with the controversial crypto entrepreneur.In May of this year, Sun claimed that Wei Li, a brother of Huobi founder Leon Li, had unjustly profited from the sale of Huobi’s native HT token. The disagreement escalated and as a consequence of that conflict, it became apparent that the acquisition agreement explicitly prohibited the buyer from using the “Huobi’’ trademark.Leon Li accused the cryptocurrency exchange of violating the acquisition agreement’s rules by unauthorized use of the “Huobi” trademark. This legal battle has shed light on the strained relationship between Leon Li and Justin Sun.The court’s decision adds a layer of complexity to Huobi Global’s legal challenges, intensifying existing regulatory issues. Notably, the cryptocurrency exchange is already grappling with a recent order from Malaysian authorities to cease operations in the country due to alleged illegal activities.The ruling comes at a critical juncture for Huobi Global. In September the business rebranded to HTX, signaling aspirations for global expansion amidst a shifting legal landscape. At the time, Justin Sun provided the rationale behind the rebrand. Taking to the X social media platform, he wrote:“It’s very hard for foreigners, Westerners, to pronounce ‘Huobi’… It doesn’t make any sense to them.” Sun went on to explain that the word Huobi means fire and coin in Chinese, adding, “That’s why we rebranded as HTX for international branding.”In light of this trademark infringement injunction decision, it could equally be speculated that the company was acting in advance of an unfavorable ruling in compliance with the terms of the business acquisition agreement.In reaching a decision on the matter, Judge Mimmie Chan J noted the lack of a defense mounted by Huobi against the trademark infringement action.

In the first quarter of this year, South Korea witnessed a significant surge in cryptocurrency trading volume, with transactions worth $456 billion conducted in South Korean won on centralized crypto exchanges, according to data from Kaiko. This surge has propelled the South Korean won to the forefront as the most-used currency for crypto trading, surpassing the U.S. dollar during the same period. Photo by Sesinando on PexelsCrypto over stock marketThe country, amidst this soaring demand for cryptocurrencies, is preparing to implement regulations aimed at safeguarding investors. South Korea's cryptocurrency market, renowned for its activity, briefly outpaced the country's stock market during the recent crypto bull run in March.  The local market is predominantly dominated by five fully licensed exchanges, with Upbit leading the pack, accounting for over 80% of the market share on most days, as highlighted by Kaiko. Other major global exchanges like Crypto.com and Binance are also eyeing entry into the South Korean market, with Crypto.com launching its retail trading platform in the country on April 29 and Binance acquiring a significant stake in Gopax in 2023. Growing regulatory frameworkDespite regulatory efforts to fortify investor protection, including the enactment of the Virtual Asset User Protection Act in July 2023, South Korea continues to work on further regulatory frameworks. The legislation aims to curb illicit activities in the crypto market and mandates safeguards for user funds, including storing over 80% of deposits in cold storage and enrollment in insurance programs to mitigate potential security breaches. Additionally, efforts are underway to standardize crypto token issuance and enhance information disclosure for investors through the development of a second part of the User Protection Act.