Korean Financial Watchdog: Investor Protection Boosts Crypto Market

OKX Middle East Fintech FZE, the Dubai-based subsidiary of cryptocurrency exchange OKX, announced on Tuesday that the company has successfully obtained a Virtual Asset Service Provider (VASP) license from the Dubai Virtual Assets Regulatory Authority (VARA), signaling its entry into the Middle East market.Photo by David Rodrigo on UnsplashNon-operational licenseThis newly acquired license positions OKX Middle East to offer spot services and spot pairs to institutional and qualified retail customers in the region. However, it should be noted that the operational aspect of the license is pending. The company stated that it will remain non-operational until all remaining conditions and select localization requirements are fully satisfied, a process anticipated to conclude in the coming weeks. Once operational, OKX Middle East will have the green light to provide regulated VASP services, facilitate AED deposits and withdrawals and introduce spot trading pairs. The move, outlined in a blog post published by the company, comes months after the subsidiary received a preparatory license from VARA, underlining its commitment to complying with regulatory standards and expanding in the Middle East. Rifad Mahasneh, the general manager for the MENA Region at OKX, expressed optimism about the region's potential, stating: "The MENA region holds immense potential to become a hub of excellence for Web3 and virtual assets. We eagerly anticipate the chance to further enhance the already flourishing ecosystem throughout the region." Global hubThis strategic move aligns with the United Arab Emirates' (UAE) goal to establish itself as a global hub for the cryptocurrency industry. VARA, formed in March 2022, was tasked with regulating the emerging virtual asset sector in Dubai. The regulatory framework gained momentum when Sheikh Mohammed bin Rashid Al Maktoum, Dubai's prime minister and ruler, approved a new virtual assets law in March 2022, providing a legal foundation for the crypto industry in the city. Dubai's proactive stance towards regulating the cryptocurrency industry has attracted several major players, including Crypto.com, Ripple, Binance and Bybit, all securing crypto licenses from Dubai's regulator. OKX Middle East joins the likes of TOKO FZE and Trek Labs Ltd FZE in obtaining a license for exchange services. Tim Byun, the Global Head of Government Relations at OKX, emphasized the significance of this license in the company's journey towards a trustless system. "This license was a crucial step for OKX as we move from a trust-based system to one that is trustless and empowers users to take control of their financial future," he stated. Byun expressed excitement about contributing to the development of Dubai's crypto and Web3 ecosystem, highlighting the importance of the market. It's noteworthy that OKX, already regulated in the Bahamas, currently restricts customers from the United States due to regulatory issues. The expansion into the Middle East represents a strategic move for OKX to tap into the growing crypto market in the region and aligns with the broader trend of cryptocurrency exchanges expanding their global footprint. 

CoinFLEX founder: creditors not to interfere with OPNXMark Lamb, the co-founder of failed crypto derivatives and yield platform CoinFLEX, has asserted that creditors of the company cannot interfere with OPNX, a Seychelles-incorporated company that Lamb has co-founded with Kyle Davies and Su Zhu, the founders of failed Singaporean crypto hedge fund, Three Arrows Capital (3AC).Photo by Chapman Chow on UnsplashFallout following writIt emerged in October that a group of CoinFLEX creditors had filed a writ of summons in the High Court of Hong Kong, claiming that OPNX, a new crypto bankruptcy claims trading platform linked to CoinFLEX, was established using CoinFLEX assets without their consent. While incorporated in the Seychelles, CoinFLEX ran its operations from Hong Kong.The writ alleges that Mark Lamb misappropriated assets, diverted clients and business opportunities and engaged in actions harmful to creditors during his tenure.The creditors argue that Lamb, while serving as CoinFLEX’s CEO, simultaneously devoted time and effort to setting up OPNX, contrary to his responsibilities. The allegations include diverting assets, falsely representing OPNX’s association with CoinFLEX creditors, disclosing confidential trade secrets and soliciting employees to move to OPNX.The legal action — filed by two companies, Liquidity Technologies and Liquidity Technologies Software — claims that OPNX’s formation was unauthorized and harmful to CoinFLEX creditors. Despite CoinFLEX’s terms of service requiring dispute resolution through arbitration in Hong Kong, the allegations have not been proven in the High Court of Hong Kong.Lamb addresses ‘Twitter FUD’In response to these creditor actions, earlier this week, Lamb took to X (formerly Twitter) to address what he termed as “Twitter FUD.” Lamb wrote:“The Hong Kong court ruled that the few CoinFLEX creditors behind recent ‘FUD’ must not disrupt or interfere with OPNX in any way — and their legal counsel has subsequently stopped representing them.”Lamb added that he hoped that CoinFLEX’s 4,800 creditors would choose the path that he has proposed on the basis that it “maximizes value.”OPNX has defended its position, emphasizing that it provided an opportunity for creditors to sell their claims on the exchange for quick cash, benefiting them. Davies and Zhu have pledged to donate their share of the profit to 3AC creditors.In February, OPNX CEO Leslie Lamb, Mark Lamb’s wife, announced the rebranding of CoinFLEX to Open Exchange (OPNX). However, the writ of summons claims that OPNX is a separate entity not authorized by CoinFLEX creditors. Leslie Lamb followed up in April by claiming backing from well-known entities in crypto venture capital, only for many of those mentioned to immediately refute such claims.The dispute has also implicated Roger Ver, a well-known character in the crypto space otherwise referred to as “Bitcoin Jesus.” Ver, a significant individual customer, was accused of defaulting by CoinFLEX. Ver denied defaulting and claimed that CoinFLEX used his trading positions against him, leading to a court-ordered arbitration.OPNX, since its launch in April, has obtained a Lithuanian license for spot trading in the EU and currently processes substantial daily trading volumes. Criminal and civil proceedings against OPNX co-founders Davies and Zhu are ongoing. The situation remains fluid as the legal dispute unfolds.

Fobl Partners with KDAC to Store Part of Customers’ Assets in CustodyKorean non-fiat cryptocurrency trading platform Fobl announced on Tuesday that it has teamed up with Korea Digital Asset Custody (KDAC) to provide enhanced customer protection.©Pexels/Savvas StavrinosKDAC, backed by Shinhan Bank, has been providing virtual asset custody services to businesses seeking safe asset management.Collaboration plans between Fobl and KDACWith the partnership, the two sides will store a portion of Fobl customers’ assets in custody, build a systematic process for custody of projects’ virtual assets and their pre-disclosures, and seek out new business opportunities in the Korean security token market.Fobl’s potential transformation to fiat exchangePreviously, it was reported that Fobl is set to face a comprehensive inspection next week from the Financial Intelligence Unit (FIU) under the Korean Financial Services Commission (FSC).This move from the FIU suggests that Fobl may soon become a fiat crypto exchange in the near future, as the financial regulator has announced that it will first inspect non-fiat exchanges that are preparing to allow fiat trading.