Bithumb Introduces Crypto Data Service Amid Fight for Profitability

The Current Status of Crypto in AsiaWith the United States having taken a very harsh line relative to cryptocurrency of late, there has been a lot of chatter surrounding the likelihood of Asia driving crypto forward. With that in mind, we’ve taken a look at the state of crypto in a number of Asian countries.©Pexels/RODNAE ProductionsJapanJapan is among the most crypto-friendly developed nations globally, having acknowledged Bitcoin as a legal payment mode and regulated crypto exchanges in 2017. Bitflyer and Bitbank are among the crypto exchanges operating in Japan, which currently has over 23 authorized crypto exchanges.The country aims to balance consumer protection and innovation by requiring crypto exchanges to register with the FSA, comply with stringent rules on security, anti-money laundering, and reporting, undergo regular FSA audits and inspections, and be part of the Japan Virtual Currency Exchange Association (JVCEA) for self-regulation.Despite being regulated, Japan’s crypto market is lively, with the Yen ranking second for Bitcoin trading volume by currency. The country has a flourishing crypto community, including blockchain firm LayerX, which requires ChatGPT expertise. Japan is also exploring the potential of central bank digital currencies (CBDCs) and plans to launch a pilot program with private sector partners in 2023 to test their feasibility for various use cases, aligning with the country’s strict approach to crypto.Japan’s crypto taxation is unfavorable, with crypto gains taxed at the same rates as regular income, potentially reaching up to 55% for higher income brackets. However, Japan is one of the few countries with comprehensive guidelines on crypto taxation, with the NTA providing a detailed document that explains different types of transactions and their corresponding tax calculations.ChinaChina’s ban on crypto mining led to many miners moving their operations overseas or selling their equipment at a loss. However, China’s crypto-mining industry bounced back, with a 21% share of the global hash rate. While China has a competitive advantage in cheap electricity, regulatory risks remain.China’s digital yuan is a legal tender fully backed by the People’s Bank of China (PBOC) and pegged to the renminbi. Unlike most cryptocurrencies, it is not decentralized or anonymous but is monitored by the PBOC. Adoption has been slow despite various partnerships and pilot tests, including with WeChat Pay.China is working with other countries on the Multiple CBDC Bridge project to explore the feasibility of cross-border fund transfers among different currencies. Launching its own CBDC may allow China to reduce its reliance on the US dollar and increase its influence over global trade and monetary policy. However, the success of that endeavor is questionable.Hong KongHong Kong is a crypto-friendly jurisdiction that faces banking access and mainland influence challenges. Despite difficulties opening local bank accounts after the closure of two crypto-friendly banks, Hong Kong remains committed to fostering its fintech hub status.The government proposed allowing retail investors to trade cryptocurrencies and ETFs and reviewing property rights for tokenized assets while considering legalizing smart contracts. Crypto purchases for all citizens are due to be legalized in June 2023. These measures should attract more investors and businesses to the city’s crypto industry.Nonetheless, Hong Kong must overcome hurdles regarding banking access and regulatory uncertainty from mainland China to maintain its attractive status for crypto businesses and investors.SingaporeSingapore has a supportive crypto ecosystem and regulations with low tax rates, favorable policies, strong financial center reputation, and proximity to other Asian markets. Notable international crypto players with offices in Singapore include Coinbase, Crypto.com and Kraken.However, Singapore imposes strict rules on crypto service providers to prevent illicit activities, requiring digital payment token (DPT) services to obtain a license under the Payment Services Act or face fines and jail time. Singapore’s crypto industry also faces competition from other jurisdictions, such as Hong Kong and the UAE, offering tax incentives and favorable legal frameworks.IndiaIndia’s crypto industry faces uncertainties due to the lack of a clear regulatory framework and frequent changes in the government’s stance. Despite having a large tech-savvy population and an active crypto community, the industry struggles with regulatory compliance and legal risks. In 2018, the Reserve Bank of India’s ban on banking channels cut off many crypto businesses and users.The Supreme Court of India later overturned the ban, but draft bills to ban or regulate crypto have since been proposed without official introduction or passage. India recently imposed a preemptive ban on crypto advertising and sponsorships and is exploring the integration of a CBDC. India’s position on crypto leans toward the anti-crypto side, just short of an outright ban.For brevity, we’ve confined discussion to these five Asian venues. However, it would be remiss of us not to mention that Vietnam has one of the highest levels of crypto adoption in the world while having a crypto trading ban in place. Not so in South Korea where crypto trading is legal, with strict regulation having been put in place. Meanwhile, Thailand’s Securities and Exchange Commission (SEC) has approved four cryptocurrencies as tradable assets, with crypto trading in the country having a legal status.It’s difficult to figure out precisely how crypto will develop geographically but it seems certain that its future will be molded to some extent in Asia.

Crypto custodian Korea Digital Asset (KODA) has seen its custody assets exceed the $6 billion mark, equivalent to about KRW 8 trillion, according to game media outlet Kyunghyang Games.  Established in November 2020 through a collaboration between KB Bank, the blockchain venture capital firm Hashed and blockchain tech company HatchLabs, KODA provides custodial services for crypto assets. A custodial service provider refers to a third-party institution that manages virtual assets on behalf of clients. Several big banks overseas such as Goldman Sachs and Citibank provide asset custodial services. Photo by Chris Liverani on UnsplashA leading provider of crypto asset custodial services Having been offering one-stop crypto asset custodial services for companies and institutional clients since March 2021, KODA has become a notable virtual asset business operator in South Korea with it being registered with the Financial Intelligence Unit (FIU). By the end of June 2023, KODA made up nearly 80% of the local custodial service market share, per FIU data. At the time, out of the total KRW 2.9 trillion in crypto assets held by 49 local custodial service providers registered with the FIU, KRW 2.3 trillion was managed by KODA. By December 2023, KODA announced it was managing KRW 8 trillion in crypto assets, with over 200 custodial wallets and about 50 institutional clients using its services.  Bracing for the potential approval of spot bitcoin ETFs in KoreaThe demand for crypto asset custodial services is expected to rise as Korea’s ruling and opposition parties are pledging to integrate crypto assets into the traditional financial system, leading up to the general election in April. Major political parties are considering the possibility of allowing transactions of spot bitcoin ETFs and legalizing investment in crypto assets by private companies. Cho Jin-seok, CEO of KODA, said that the integration of digital assets into the traditional financial system is an unstoppable global trend that no one can resist, and that KODA will be able to serve as a key crypto infrastructure if the local financial authority approves trading spot bitcoin ETFs.  Kim Seo-joon, CEO of Hashed, stressed the significance of preparing for the potential approval of spot bitcoin ETF transactions, noting how a number of spot bitcoin ETFs were released in the U.S. right after the approval. He added that KODA’s commitment to regulatory compliance and technological expertise would make it an essential partner in introducing virtual asset ETFs to the local market.

China’s Bitmain Makes Plans to Unveil World’s First 1XJ/T Bitcoin MinerBitmain, the leading player in the cryptocurrency mining equipment business, is set to host the upcoming 2023 Global Digital Mining Summit (WDMS 2023) in Hong Kong, using the event as a springboard to launch its latest Bitcoin miner.The Beijing-headquartered mining equipment manufacturer set out its summit and equipment launch plans on Chinese social media platform WeChat on Monday.Photo by Dmitry Demidko on UnsplashIntroducing the ANTMINER S21With the theme “Empower the Bull Market, Mine with Timing,” the summit will aim to assist clients in strategically positioning themselves in the mining sector to reap the rewards of the next crypto bull market. During the event, Bitmain will introduce its latest research and development achievement — the ANTMINER S21 mining machine.The ANTMINER S21 is likely to take its place at the forefront of Bitcoin mining, given that Bitmain’s ANTMINER series has dominated the mining sector in recent years. Bitmain claims that with the S21, it is introducing a miner with unmatched computing power and efficiency, ushering the global mining industry into the 1XJ/T (Joules/Terahash) era.Ever greater efficiencyBitmain has consistently led the industry’s technological innovations, starting with the S9 model, which first broke the 100J/T barrier, to the S19 series with efficiency ratings of 34.5J/T, 29.5J/T, 21.5J/T, and 20.8J/T. The upcoming S21 is expected to continue this track record of ever greater Bitcoin miner efficiency.In addition to technological advancements, Bitmain is using the summit as a mechanism to offer benefits to attendees. The company will launch a customer points system, allowing clients to apply for credit limits for S21 miners based on their points, enabling them to mine first and pay later. Moreover, the points system will facilitate conversion of points into exclusive coupons for the ANTMINER S21.Hong Kong venueHong Kong has been chosen as the venue for this summit and that’s likely by design rather than by coincidence. Over the course of the past twelve months, the Chinese autonomous territory has been making huge strides in its efforts to become a center for blockchain and crypto-related business.In recent months, Hong Kong has announced several supportive blockchain policies, attracting a significant pool of Web3 talent. The summit will also feature keynote speeches from local government officials, indicating the willingness of the local administration to take every opportunity to further Hong Kong’s strategic objective of furthering crypto, blockchain, and Web3 in the city.Bitcoin mining has proven to be ruthless in its drive towards ever greater efficiency. This is playing out mainly on two different fronts. Firstly, in terms of the cost of the energy input. Miners continue to innovate in this area, to the extent that at this point, it’s difficult to remain competitive if an operation is not tapping into an energy source with a near zero input cost. This is being exploited by sourcing energy that is surplus to energy grid requirements, oftentimes renewable energy, that would otherwise be wasted.The second major factor is the efficiency of the miners themselves. Entities that gain early access to the latest generation of miners from Bitmain and other mining equipment manufacturers immediately become more efficient than the other mining outfits that they compete with to unlock Bitcoin mining rewards on the Bitcoin network.