Hong Kong’s OSL crypto exchange receives $91M boost

Scroll’s zkEVM Launches on Ethereum MainnetScroll, the Seychelles-headquartered project behind the Ethereum layer-2 network of the same name, has officially made its debut on the Ethereum mainnet.Photo by Zoltan Tasi on UnsplashAttempting to solve for scalabilityThe project team announced the development via a press release which was published on Tuesday. The network launch signifies the latest in a series of attempts by various layer-2 projects, including Polygon and StarkWare, to address the persistent challenges of high transaction fees and network congestion that have hindered Ethereum’s usability in recent times. Speaking to layer-2 development, co-founder Sandy Peng stated:“We see a future where the vast majority of value transfer takes place on Layer 2s on Ethereum. What will drive that adoption is improved user and developer experience.”After testing and refinement on its testnet, Scroll believes that it is in a good position to play an active role within the Ethereum ecosystem by providing a general-purpose, zero-knowledge Ethereum virtual machine (zkEVM) roll-up.The project has 900,000 wallet addresses in active use on its testnet, having executed seven million transactions since August. The testnet has seen over 55 million transactions during its year-long operation.At its core, Scroll’s mission is to combine Ethereum’s network security with reduced fees and lower latency, making it an attractive proposition for existing Ethereum projects. According to Peng, Ethereum developers can seamlessly deploy their projects on Scroll and harness the groundbreaking zkEVM technology.Incorporating bytecodePeng emphasized the significance of zkEVM’s ability to batch proofs efficiently, resulting in faster transaction speeds and cost reductions, thanks to its bytecode-level compatibility.Bytecode, in the realm of computer programming, simplifies intricate machine cryptography, making code more accessible for computer hardware. Scroll allows deployed smart contracts to store the bytecode of their transactions, which is then sent to a centralized zkEVM node. This node verifies the transaction’s accuracy without revealing its content. Once verified, the transaction’s status is updated on the Ethereum network, eliminating the need for re-execution. Peng pointed out:“Thanks to this feature, Ethereum devs can leverage all the same tools they are familiar with, ensuring that everything operates seamlessly right from the start.”Scroll’s mainnet code was subject to audits conducted by four major auditing firms, namely Zellic, Trail of Bits, OpenZeppelin, and KALOS, in an effort to ensure robust security and reliability.Efforts towards greater decentralizationWhile Scroll’s current implementation offers compelling features, the team is actively researching ways to further enhance the network’s decentralization. Currently, if the sequencer goes offline, the protocol halts, creating a potential vulnerability. To address this, the Scroll team is working on a protocol upgrade that will enable “forced batches.” This update will allow permissionless publication of batches through the base layer, even in the event of a sequencer halt.Peng elaborated on the team’s vision, stating: “Mid-term, the goal is to minimize the probability of a sequencer halt through decentralization.” This approach aims to bolster the network’s resilience and ensure a smoother user experience.While headquartered in the Seychelles, the project has its origins in China through its Chinese founders, Ye Zhang and Haichen Shen, alongside Peng, with many of its 60-strong project team based in mainland China and Hong Kong.

Mox, a virtual bank in Hong Kong and a subsidiary of Standard Chartered, has introduced exchange-traded fund (ETF) trading for cryptocurrencies, marking a significant expansion into the digital asset space. The bank announced on Aug. 7 that it now offers its customers the ability to trade spot Bitcoin and Ether ETFs directly on its platform, making it the first virtual bank to do so.Photo by Florian Wehde on UnsplashExpanding crypto offeringsThe digital bank is also planning to broaden its cryptocurrency services. Future expansions may include direct purchasing and trading of cryptocurrencies in partnership with a licensed exchange. This move aligns with Hong Kong’s regulatory framework, which has been adjusting to accommodate and regulate crypto activities more robustly. Competitive pricing and user engagementMox is promoting itself as an economical choice for crypto ETF trading, with fees set at 0.12% of the transaction volume, with a minimum charge of 30 Hong Kong dollars ($3.85) for Hong Kong-listed spot and derivatives ETFs and $0.01 per share with a minimum of $5 for U.S.-listed derivatives ETFs. As of now, a local report reveals that 28% of Mox's customers engage in cryptocurrency investments, with 18% actively trading. The introduction of these ETFs is seen as a move to empower these customers to access emerging asset classes securely. Future aspirationsBarbaros Uygun, the CEO of Mox, expressed that the inclusion of crypto ETFs is part of the bank's broader strategy to set a global benchmark from Hong Kong. The bank aims to stay competitive by innovating and adapting to market changes. Jayant Bhatia, the bank’s chief product officer, hinted at more extensive plans in the crypto investment realm, although specifics on the timeline for launching broader crypto trading services were not disclosed. Despite the launch, the overall uptake of crypto ETFs in Hong Kong has been lukewarm. Bosera HashKey, ChinaAMC and Harvest Global, the issuers of the three spot ETFs in Hong Kong, have seen minimal activity with combined assets under management totaling just $236.3 million. The launch by Mox could potentially invigorate the market for crypto ETFs in Hong Kong as the region strives to become a leading hub for cryptocurrency in Asia. 

Meme coin project Floki Inu has implemented restrictions on users in Hong Kong from accessing its staking programs following a warning from the Hong Kong Securities and Futures Commission (SFC). Last week, the regulatory body labeled Floki's staking initiatives as "suspicious investment products'' and urged caution among investors. On Jan. 26, it specifically cautioned Hong Kong users about the Floki and TokenFi staking programs, emphasizing the promised annualized returns ranging from 30% to over 100%. The Commission expressed concern over investment products that make claims of returns deemed "too good to be true."Photo by Jie Yeu Teoh on UnsplashStaking program access block in Hong KongResponding to the SFC's warning, Floki Inu took proactive steps to prevent users in Hong Kong from participating in its staking programs. In an official blog post which was published on Tuesday, the project's team announced the implementation of "practical measures" to block Hong Kong-based users from joining the staking programs. Additionally, prominent warnings have been placed on the Floki and TokenFi staking websites, clearly stating the ineligibility of Hong Kong users to participate. The SFC emphasized that neither of the mentioned investment products holds authorization in Hong Kong, warning that unauthorized schemes provide limited to no protection under its Securities and Futures Ordinance (SFO). Investors engaging in such unauthorized schemes may face the risk of losing their entire investments. Addressing regulatory concernsFloki Inu's team has responded to the regulatory concerns by actively collaborating with legal advisers to address potential regulatory issues associated with the staking project. The team committed to responsible community practices, while affirming its dedication to implementing measures to prevent Hong Kong users from participating in the staking program until regulatory concerns are resolved. As of Jan. 29, there is no record of Hong Kong users joining the staking programs, according to the Floki team. Furthermore, the team revealed that offline marketing activities in Hong Kong had already been halted before the project's launch in December 2023. Clarifying high yieldAddressing the SFC's primary concern regarding the high annual percentage yield (APY), the Floki team provided explanations. They clarified that the rewards are subject to volatility influenced by market dynamics and the value of staking rewards may fluctuate based on the market valuation of the token rewards. The team attributed the high APY for its staking programs to the allocation of the majority of TokenFi's token supply to token stakers, highlighting that the project had not raised venture capital funds or conducted a presale. They noted that market forces beyond their control had significantly increased the TokenFi price from its initial market cap at launch. In response to potential user confusion, the Floki team emphasized the complete decentralization of the staking programs for Floki and TokenFi, assuring users of a clear understanding of how the programs operate. They concluded by expressing their commitment to ongoing collaboration with regulatory bodies to ensure compliance and foster a responsible and transparent environment for users. Community response has been largely positive with one crypto influencer claiming: “You will not find a more legit team in #Crypto than $FLOKI. I’ve known about them for years and everyday they continue to handle themselves in the most informative, structured, and professional way.”