NEOPIN Launches South Korea’s First ETH Liquid Staking Product

The Hong Kong Monetary Authority (HKMA) has outlined that it has established a community initiative relative to its recently launched Project Ensemble tokenization market development effort. 'Project Ensemble Architecture Community'In a press release on May 7, the Hong Kong regulator set out the establishment of the “Project Ensemble Architecture Community.” Project Ensemble was launched two months ago on March 7. At the time, the regulator described the project as “a new wholesale central bank digital currency (wCBDC) project to render support to the development of the tokenisation market in Hong Kong.” The HKMA is trying to create an environment in which it can “develop standards” for the emerging tokenization market, with particular emphasis on the use of a wholesale central bank digital currency (wCBDC). The Chinese autonomous territory’s central bank has launched the “Project Ensemble Architecture Community,” with a view towards supporting interoperability between a wholesale CBDC, tokenized money and tokenized assets. The HKMA has outlined the community's primary objective, stating it aims to provide recommendations on various topics, with initial emphasis on devising a mechanism to facilitate seamless interbank settlement of tokenized deposits through wCBDC for tokenized asset transactions.Photo by Jimmy Chan on PexelsPublic and private sector participantsFurthermore, the working group intends to support the design and execution of Project Ensemble. Notable participants in the "Architecture Community" include the HKMA itself, Hong Kong’s other financial regulator, the Securities and Futures Commission (SFC), the BIS Innovation Hub Hong Kong Centre, the CBDC Expert Group and seven private sector entities.  Among these are Bank of China (Hong Kong), Hang Seng Bank, HSBC, Standard Chartered Hong Kong, HashKey Group, Ant Digital Technologies and Microsoft Hong Kong. Hashkey Group owns one of two Hong Kong-regulated cryptocurrency exchanges, HashKey Exchange. It also runs a brokerage, asset manager and tokenization platform, amongst other entities. Ant was recently involved in a tokenized deposit trial with HSBC. Regulatory sandboxOne of the first matters on the agenda for the newly-formed Community is to make recommendations about using a wCBDC for interbank settlement of tokenized deposits. Following that, the project plans to work towards the design and implementation of the Project Ensemble Sandbox which will launch in the coming months. The HKMA has been actively testing its CBDC and commenced the second phase of the e-HKD pilot in March. This phase of the pilot program is slated to extend until mid-2025. The journey towards exploring CBDCs in Hong Kong dates back to 2017, with the authorities intensifying their focus on researching a potential e-HKD in 2021, spanning both wholesale and retail levels. With the participation of key stakeholders from both the public and private sectors, including leading financial institutions and technology firms, the initiative appears to be well-positioned to drive innovation and address the evolving needs of the financial industry in Hong Kong.

Indonesia witnessed a striking decline in cryptocurrency tax revenue for the year 2023, according to local media. 63% decreaseA report by Indonesian business and financial publication Kontan detailed a tax take drop to $31.7 million (Indonesian rupiah 467.27 billion). That tax collection is in sharp contrast to the partial collection period in 2022 when the crypto tax regime was initially introduced. It represents a drop of around 63%. The decline is part of a broader tax reform targeting the "digital economy" implemented in 2022, with the Indonesian government expressing the expectation that the reform would enhance tax collection, fostering a "healthy and fair taxation system."Photo by Nick Agus Arya on UnsplashDeclining transaction volumesDespite bitcoin's impressive surge of approximately 160% throughout 2023, the dip in crypto tax revenue was notable. The decrease is closely tied to a drop in transaction volumes over the same period compared to 2022. A report by CoinDesk Indonesia last week put that trading volume decrease at around 60%. Crypto transactions in Indonesia face dual taxation – a 0.1% income tax and a 0.11% value-added tax (VAT). Additionally, local crypto exchanges are subject to a special tax of approximately 0.04%, contributing to the national digital asset bourse. Disadvantaging local exchangesLocal exchanges in Indonesia, including prominent ones like Indodax, have voiced discontent with the high tax rates, contending that these levies are driving users towards unregulated offshore exchanges. Earlier this month Indodax CEO Oscar Darmawan called on the Indonesian government to review crypto tax rates. Darmawan highlighted that the cumulative taxes on crypto transactions often surpass the trading fees paid by users, posing a risk of users seeking more cost-effective alternatives. Local exchanges suggest that crypto transactions should only be subject to income tax, eliminating the VAT component. This proposal comes as Indonesia's Financial Services Authority (OJK) prepares to implement cryptocurrency regulations in early 2025. The aim is to align the taxation of cryptocurrencies with their market nature, possibly redefining them more as securities than commodities. Inadequate tax regulation can lead to a decline in local market activities, potentially resulting in capital flight to more favorable jurisdictions. Indonesia's situation serves as a reminder of the crucial need for policies that understand and adapt to the dynamic nature of the cryptocurrency sector. India is being similarly challenged. Local exchanges there have also complained of punitive taxation, which resulted in Indian users migrating to offshore exchanges. That scenario led indigenous exchanges to lobby the government to take action. The authorities have duly acted, flagging a number of global exchanges for operating illegally within India. It’s not all bad news for the development of digital assets within Indonesia. The country still ranks highly in terms of crypto adoption within the Asian region. Crypto was also floated as an election issue recently by Gibran Rakabuming Raka, a vice-presidential candidate in the upcoming election. The politician expressed his commitment to accelerating the country's position as a leader in the digital revolution. 

Animoca Indicates Fund Interest From Console MakersThe head of Animoca Ventures has said that Web3 gaming is attracting the interest of veterans of the gaming world as well as that of “key Japanese console makers.”Animoca Ventures is a subsidiary company of Hong Kong-headquartered Web3 gaming and NFT firm, Animoca Brands. In a conversation with The Block recently, James Ho explained that although Web3 gaming has seen a short to medium-term downtrend when using the pricing of gaming-related tokens as the metric, the Animoca Ventures lead is seeing interest coming from “some of the best, most profound veterans in gaming.”Photo by Albie Patacsil on UnsplashProof of interestHo elaborated that there are a host of examples that back up his claim. He referred to FunPlus’s investment in global cross-platform play-and-earn games developer and publisher, Xterio. FunPlus itself is a Switzerland-headquartered independent games developer and publisher with offices and operations in China, Singapore, Canada, Spain, and the United States. Xterio raised $40 million in a funding round led by FunPlus in August of last year, with funding going towards building out its platform alongside further game development.Ho also cited Square Enix, a Japanese gaming conglomerate that has shown an interest in blockchain-based gaming in recent years. In April, it announced that it was tripling down on blockchain by partnering with Web3 platform Elixir. The objective of the collaboration is to generate visibility and adoption of Web3 gaming among traditional gamers.It’s also understood that Chinese tech giant Tencent has had a games studio under its group of companies which is believed to be building a blockchain-based first-person shooter game. Meanwhile, French video game publishing behemoth Ubisoft is an investor in Animoca Brands while also participating in a crypto-focused fund run by multi-stage technology investment platform, White Star Capital.Console-maker intentMost notable from Ho’s interview, though, is his claim that “key Japanese console makers” have an interest right now in pursuing Web3 gaming. That’s incredibly significant because if Web3 can conquer the consoles, it will truly be a mass-market affair at that point.Ho elaborated: “Console makers never cared about free-to-play until it grew into multi-million users, what we’re seeing here now is some of the console makers with their deep pockets want to get involved in potentially a fund to stay on top of innovation… And that to me is a signal that they want to build something in this space in the near future, or not too distant future.”The Animoca Ventures lead talked about “key Japanese console makers,” specifically in the context of interest expressed by them in investing in a second early-stage venture fund that Animoca is considering. The expression of interest has become evident to the company as it’s a response it received having touted the prospect of establishing the fund.It’s interesting to hear that Animoca is actively pitching the notion of raising another fund, as it had been speculated that the firm has scaled down some of its existing funds. It’s understood that the firm was working on the new fund in November of last year, initially proposing a target of $2 billion. Once January came around, Animoca took the decision to scale that target back by half to $1 billion.The company denies that reporting on the subject, suggesting instead that the original target of the fund was $1 billion from the outset.