Thailand Pushes Back Against Facebook-Enabled Crypto Scams

Hong Kong regulators signal embrace of spot crypto ETFsHong Kong has signaled its readiness to usher in spot crypto exchange-traded funds (ETFs), as the Securities and Futures Commission (SFC) and the Hong Kong Monetary Authority (HKMA) jointly announced on Friday that they are prepared to accept applications for such funds.Photo by Oskar Kadaksoo on UnsplashUpdated virtual asset-related policyIn a set of circulars released, a joint circular representing both regulators and a separate circular published by the SFC, they outlined the updated policy for intermediaries engaging in virtual asset-related activities.The SFC, responsible for overseeing financial markets in Hong Kong, expressed its openness to applications for the authorization of funds with exposure to virtual assets, specifically mentioning virtual asset spot exchange-traded funds (VA spot ETFs).This move expands beyond the existing crypto futures ETFs, demonstrating Hong Kong’s commitment to adapting its regulatory landscape to the evolving crypto market. It also builds on positive commentary made by SFC CEO Julia Leung on the subject last month. Leung stated that the regulator was open to the notion of retail participation in spot crypto ETFs in Hong Kong.Leung stated:“We welcome proposals using innovative technology that boosts efficiency and customer experience. We’re happy to give it a try as long as new risks are addressed. Our approach is consistent regardless of the asset.”Use of license platformsFriday’s SFC circular emphasized that transactions conducted by these ETFs must occur through SFC-licensed crypto platforms or authorized financial institutions. The SFC outlined that both in-kind and in-cash subscription and redemption methods are permissible for SFC-authorized spot VA ETFs, providing flexibility in fund management.Custody requirements were also addressed, with the SFC specifying that the trustee or custodian must delegate its crypto custody function exclusively to an SFC-licensed Virtual Asset Trading Platform (VATP) or entities meeting the crypto custody standards set by the HKMA.Industry responseThese latest circulars from the regulators have prompted a response from the industry. The Hong Kong Stock Exchange has reacted, welcoming the announcement. It believes that such a move would serve to strengthen Hong Kong’s position as a digital asset hub in the region. The exchange already lists a number of crypto futures ETFs, with multinational investment bank UBS having recently extended access to these products to its Hong Kong-based high-net-worth clients.While the regulatory landscape in the United States in 2023 has proven to be hostile, one very positive development appears to be ongoing work towards spot bitcoin ETF approval. Although still a matter of speculation, many industry commentators believe that approval will come through on Jan. 10. The advent of spot bitcoin and crypto ETFs in both eastern and western markets would likely make for an extremely bullish 2024 for the industry.Hong Kong’s move towards spot crypto ETFs aligns with its proactive stance in adapting to the rapidly evolving crypto landscape. The regulatory framework, as outlined in the circulars, reflects a balance between fostering innovation and ensuring investor protection. The city’s financial authorities have taken a comprehensive approach to review and update policies, once again signaling their ongoing commitment to embracing the growing role of virtual assets in the financial world.

Amid the ongoing cryptocurrency market slowdown, a South Korean analyst said a rebound will hinge on effective policy measures and sustainable business models.Photo by Kanchanara on UnsplashAnalyst urges policy and profitabilityAccording to an analysis by iM Securities researcher Yang Hyun-kyung, cited by local outlet Etoday, the current downturn stems from several factors: a liquidity crunch in short-term funding markets, a strengthening U.S. dollar, rising risk aversion, and a prevailing narrative of a cyclical correction. Yang noted that a strong dollar typically drains market momentum, as tighter global liquidity prompts investors to deleverage and reduce exposure to risk assets. He added that growing uncertainty over potential U.S. rate cuts in December has further fueled risk aversion among institutional investors, putting selling pressure on both major cryptocurrencies and altcoins. While the expected resolution of the U.S. government shutdown may create a more favorable environment for a modest technical rebound, Yang argued that the crypto sector still needs to develop profitable business models and gain growth momentum through supportive policy measures. Brokerage frames crypto as diversifierDespite the current headwinds, another Korean brokerage firm released a quarterly report framing digital tokens as an emerging alternative asset class. According to Etoday, Hanwha Investment & Securities CEO Jang Byung-ho wrote in the report that the primary goal of retail investment is to preserve purchasing power. He drew a parallel to the U.S. market in the 1980s, when bond investors would have seen their returns erode had they failed to recognize equities as a viable investment vehicle. Citing that lesson, Jang suggested investors consider digital assets as a new pillar for portfolio diversification. Diverging approaches from global central banksThese evolving viewpoints on crypto come against a complex global macroeconomic backdrop. From one perspective, the People’s Bank of China (PBOC) has begun quantitative easing (QE). Otavio Costa, a macro strategist at Crescat Capital, shared a chart on X showing that the value of the PBOC’s balance sheet assets is on track to surpass that of the U.S. Federal Reserve. Costa predicted the Fed would soon follow suit, stressing that investors are underexposed to hard assets. This potential easing contrasts with speculation that the Bank of Japan (BOJ) may raise interest rates next month. One BOJ board member noted at a recent policy meeting that most conditions for a hike have already been met and added that a move is likely once wage negotiations scheduled for spring point to sustained pay growth, as long as the global economy avoids major disruptions. These diverging policy directions have mixed implications for the crypto market. Typically, dovish measures like QE are seen as supportive, as increased liquidity tends to boost risk appetite. Rate hikes, by contrast, withdraw liquidity from the system, limiting the upside for risk assets like digital tokens. As economic conditions evolve and the industry adapts, investors will be watching closely to see how these shifts shape the market’s next moves. 

Rotonda, a subsidiary of crypto exchange Bithumb that operates Burrito Wallet, announced yesterday that it held “Partners Day 2024.” According to a report by local news outlet Etoday, the event was prepared to share the company’s business plan for this year and its partnership strategies and was attended by 50 stakeholders from 30 companies partnering with Burrito Wallet. The soon-to-be-released service, “Burrito Partners,” was also introduced in the venue.  Following the official launch in February last year, Bithumb’s Burrito Wallet has been collaborating with Web2 and Web3 firms in blockchain service development and co-marketing. Burrito Wallet is dedicated to contributing to bridging Web2 and Web3 ecosystems through forging partnerships.Photo by Christina @ wocintechchat.com on UnsplashSoon-to-be-launched service, Burrito Partners Burrito Partners is Rotonda’s new service to help its partners with marketing efforts. It has been designed to enhance the workflow and boost the quantitative growth of its partners that struggle with a lack of workforce.  Burrito Wallet will leverage Burrito Partners to provide services that can monitor user events, manage follower and marketing indexes, strengthen user community, provide airdrop solutions and secure transaction data, all of which are expected to maximize marketing performance. “By making partnerships with various companies that share the same values with Bithumb’s Burrito Wallet, we have been able to actively expand the blockchain ecosystem,” said Shin Min-chul, CEO of Burrito Wallet. “We are also planning to roll out a rewarding service for users sometime during next month. Burrito Wallet is dedicated to developing a system where all partners can thrive,” he added.