KuCoin Thailand moves to full platform launch

The Chinese authorities are reportedly mulling over the possibility of approving the use of stablecoins pegged to and backed by the Chinese yuan. That’s according to a report published by Reuters on Aug. 20, with the publication citing “sources familiar with the matter.”Photo by Eric Prouzet on UnsplashInternationalization of the Chinese yuanChina’s State Council, its cabinet and primary administrative authority, has scheduled a review of yuan-backed stablecoins for later this month, a development that could potentially lead to their approval. The Chinese have been leaders in recent years in the development of a central bank digital currency (CBDC), the digital yuan. The digital yuan was further along in its development than any other CBDC globally, with the Chinese making concerted efforts to bring the digital currency into use at home, with an eye toward global use for international trade. While the U.S. dollar has enjoyed an extended period as the world’s reserve currency, the weaponization of the currency by the U.S., particularly through the application of sanctions, has led BRICS (Brazil, Russia, India, China and South Africa) nations to consider alternatives. One of Reuters sources asserted that the Chinese authorities are now homing in on the potential to internationalize the yuan via stablecoins. Setting the tone for stablecoin useMembers of the Chinese government leadership are expected to establish the tone for stablecoin use following their upcoming review, outlining the parameters within which the Chinese authorities will permit their use. Reacting to this development, Robin Brooks, a senior fellow at the Brookings Institution, asserted that China’s newfound interest in yuan-backed stablecoins is a sign of “how insecure China is in the global financial system.” Brooks added that the way to internationalize a sovereign currency is to promote the rule of law and property rights rather than pursue the use of stablecoins, which he described as “ridiculous.”  Growing global interestWhile the Brookings Institution is not directly backed by the U.S. government, the organization is nevertheless a Washington, D.C.-based think tank. Despite Brooks’ objection to the use of stablecoins, China is not the only nation to show interest in using them.Taking to X, Raphaël Bloch, co-founder of crypto media platform The Big Whale, pointed out that increasingly, nations around the world are embracing stablecoins due to the efficiency of global currency distribution that is possible via public blockchain networks.  Additionally, stablecoins offer an effective means of government debt financing, given that stablecoin reserves are backed by government bonds. In the U.S., President Donald Trump has ruled out the pursuit of a CBDC. Last month, the U.S. House of Representatives passed the Anti-CBDC Act to prohibit the development of a CBDC by the Federal Reserve. Instead, Trump has said that a stablecoin regulatory bill working its way through the legislative system will ensure global dominance for the U.S. in the crypto sector. In June a Deutsche Bank strategist claimed that the legislation would strengthen the U.S. dollar’s global dominance, with several American politicians having since expressed the same view.Earlier this week, Japan’s Financial Services Agency (FSA) signaled that it is likely to approve the issuance of a yen-pegged stablecoin. Meanwhile, the authorities in South Korea are working on a bill related to won-pegged stablecoins.

South Korean banks will soon have to be prepared with adequate anti-money laundering (AML) measures when issuing real-name bank accounts to cryptocurrency exchanges, according to a report by local media outlet News1. This requirement is part of the proposed amendment to the enforcement decree of the Financial Transaction Reports Act, with the Korean Financial Services Commission (FSC) issuing a legislative notice about it today. The FSC will be gathering feedback until March 4, prior to the implementation.Photo by Tuan P. on UnsplashAdequate staff and physical facilitiesThe new amendment requires banks supporting virtual asset service providers (VASPs) to employ adequate staff and establish and uphold physical infrastructure to combat money laundering and terrorist financing. Through this revised legislation, the FSC aims for banks to be equipped with the necessary resources to manage risks linked to the provision of real-name bank accounts to VASPs. With the issuance of real-name bank accounts, banks will face ongoing cautionary duties. The FSC plans to offer clearer guidelines to help banks decide whether to continue providing such accounts to VASPs. In its 2024 agenda, the FSC stated its plans to evaluate VASPs' readiness for their responsibilities ahead of the Virtual Asset User Protection Act, set to be implemented in July. Additionally, the regulatory body will develop infrastructure to improve its monitoring of the cryptocurrency market.Intelligence platform focused on financial securityMoreover, the FSC plans to create a specialized intelligence platform focused on financial security. This platform is aimed at enabling proactive responses to cyberattacks and supporting financial institutions in the agile management of risks associated with emerging technologies.

Japan’s Cryptoasset Group Proposes Self-Regulatory Reforms for IEO SystemThe Japan Cryptoasset Business Association (JCBA) has revealed a preliminary draft advocating for reforms in self-regulation to bolster the soundness of the initial exchange offering (IEO) system. This draft has been submitted to the Japan Virtual and Crypto Assets Exchange Association (JVCEA).IEOs serve as a mechanism enabling various enterprises to accrue funds and broaden their user base by orchestrating token sales on cryptocurrency exchanges for Web3 projects. This fundraising method holds the potential to enhance trust as crypto exchanges, supervised by the Japanese Financial Services Agency, undertake evaluations of project feasibility and maintain ongoing oversight.Photo by Takashi Miyazaki on UnsplashPositive regulatory developmentsThe ameliorating regulatory landscape is also a positive development, highlighted by this year’s tax law amendment, which grants exemptions to enterprises’ self-issued tokens from year-end corporate taxation. In Japan, four IEOs have been conducted so far, with the inaugural IEO amassing over 900 million yen (approximately $6 million). The cumulative amount from the four IEOs has surpassed 4.4 billion yen. However, given that the IEO is a relatively nascent fundraising method, improvements in token price stability and operational modalities are required to ensure that businesses and users can engage with it confidently.Enhanced user protectionAgainst this backdrop, JCBA, an organization comprised of various enterprises involving virtual assets and Web3, has been discussing the direction of the IEO system from a corporate viewpoint since May of this year. Establishing price stabilization measures and selling restrictions within the Japanese IEO system will contribute to user protection by allowing investors to manage their assets under domestic regulations. JCBA stated that users will find domestic exchanges more secure in comparison to foreign ones.As this proposal represents an initial draft, deliberated and formulated only within the JCBA, the group intends to consult and assess the feasibility of the self-regulatory rules with each pertinent organization as necessary.Four key pointsThe document submitted by JCBA to JVCEA presented four key points concerning the IEO. Pertaining to pricing, it suggested the diversification of calculation methods customized to each project and the specification of price-related disclaimers. On liquidity, it posited that liquidity objectives should be established at the time of listing, and an environment conducive to securing liquidity should be developed. JCBA also pointed out the necessity of establishing rules for price stabilization measures at the time of listing. Finally, regarding selling restrictions, it was noted that both token issuers and exchanges should adhere to a minimum three-month lock-up period for tokens.