Japan to classify crypto as financial instruments, seeks 20% tax rate

GSR Gets on Path Towards Full Regulatory Approval in SingaporeGSR Markets Pte. Ltd., the Singaporean subsidiary of the global crypto trading firm GSR, has reached a significant milestone in its quest to become a fully licensed entity within the city-state. On Monday, the Monetary Authority of Singapore (MAS) granted GSR in-principle approval for a Major Payment Institution (MPI) license.Photo by Mike Enerio on UnsplashTrading licenses filtering throughThis development mirrors similar approvals granted to other crypto firms in the region, solidifying Singapore’s status as a hub for crypto and Web3 innovations. The approval of GSR’s MPI license follows hot on the heels of Coinbase Singapore’s announcement of securing a full Major Payment Institution license from MAS.Other companies such as Circle, Blockchain.com, and Crypto.com have also obtained MPI licenses this year. These developments underscore the competitive yet regulated landscape of the cryptocurrency market in Singapore.In-principle approvalThe in-principle approval from MAS empowers GSR to provide crypto and fiat-related services to Singaporean residents and entities. This includes the ability to conduct payment services without the limitations of single transaction thresholds (SGD 3 million) and monthly limits (SGD 6 million). GSR’s CEO, Jakob Palmstierna, expressed gratitude for MAS’s constructive oversight, which has played a pivotal role in shaping the evolving digital asset landscape in Singapore. Palmstierna stated:“We are immensely grateful to MAS for their constructive oversight, which helps shape a growing digital asset ecosystem that we feel proud to be a substantial part of.”Meanwhile, GSR’s COO Xin Song, emphasized the importance of this approval, stating that it enables them to “deepen our local client partnerships and continue in our critical role as a liquidity provider within the ecosystem.”GSR’s presence in Singapore aligns with the country’s burgeoning crypto-friendly environment. Recent surveys indicate that 25% of Singaporeans view cryptocurrency as the future of finance, with 32% having some involvement in crypto ownership. Moreover, Singapore boasts over 700 Web3 companies, positioning itself as a pivotal market for the expansion of the crypto and Web3 economy.Company ambitionsGSR, established in 2013 in New Jersey, offers a diverse range of services, including over-the-counter crypto trading, derivatives trading, market making, and venture capital investments. The firm is no stranger to regulatory compliance, holding Money Service Business licenses across several US states.The company was founded by former Goldman Sachs Executives Rich Rosenblum and Cristian Gil. At the height of the last crypto bull run, the crypto market maker had plans “to add 100 hires every six months for the next few years.” No doubt that ambition has been scaled back since then, given the protracted bear market which has followed.Last month, Gil became embroiled in a spat with Andrei Grachev of rival market making firm, Singapore-based DWF Labs.GSR’s recent attainment of in-principle approval for a Major Payment Institution license from MAS reinforces Singapore’s position as a leader in the crypto space. The firm’s interest in pursuing a compliant route forward and its role as a liquidity provider bode well for both GSR and the broader crypto community in the Asia-Pacific region.

Coincheck, a subsidiary of Monex Group, a Tokyo-based global financial services firm, has gained U.S. Securities and Exchange Commission (SEC) approval to become the first Japanese crypto exchange to list on the Nasdaq, an American stock exchange.Photo by Denys Nevozhai on UnsplashSPAC mergerThe approval by the U.S. regulator was filed on Nov. 13. The listing has been enabled due to the company’s decision to enter into a merger with a special purpose acquisition company (SPAC), namely Thunder Bridge Capital Partners (TBCP).  A SPAC raises money through an initial public offering (IPO) to either acquire or merge with an existing company. Opting for a SPAC means that Coincheck can forego a lot of the time and expense that would be necessary if it attempted to effect an IPO on its own. Parent company Monex Group published a statement outlining that Coincheck CEO Yuko Seimei had “been diligently preparing for listing its common stock on the Nasdaq Global Market (“Nasdaq”) through a previously announced business combination with Thunder Bridge Capital Partners.” Possible Nasdaq listing on Dec. 10 In a press release issued by TBCP, the company claimed that the proposed merger is anticipated to close on or about Dec. 10, 2024. That eventuality is subject to stockholder approval, Nasdaq approval and specific closing conditions. Consequently, Coincheck’s Nasdaq listing could potentially happen as early as Dec. 10. TBCP is holding a shareholder vote on the merger on Dec. 5. If all conditions are satisfied to pave the way for listing, the company’s stock will be listed using CNCK as the Nasdaq stock ticker. Once the merger and Nasdaq listing have been accomplished, Coincheck will still remain a subsidiary of Monex Group. The merged business will gain access to $237 million, held in trust by TBCP, with Monex retaining an 82% stake in the company. Furthermore, Thunder Bridge CEO Gary Simanson will lead the new company. The $1.25 billion merger had been in the works since 2022, having faced multiple delays on the path towards merger completion and Nasdaq listing. Coincheck finally filed with the SEC to merge back in May. Parent company Monex has other interests in the digital asset sector beyond its involvement with Coincheck. Last December the company acquired a majority stake in 3iQ Digital Holdings, a Canadian crypto asset management company.Monex has just launched a new brand, Monex Web3, comprising of Monex’s Web3 business portfolio. It also offers a Web3 consulting business, using its local know-how to guide Web3 startups in entering the Japanese market. Coincheck has also engaged in partnerships to assist other firms in gaining access to the Japanese market. Earlier this year the leading Japanese crypto exchange partnered with USD Coin (USDC) stablecoin issuer Circle, in an effort to expand USDC access within the local market. In January 2018 the exchange suffered what was at the time the world’s largest ever digital asset theft, losing $534 million in virtual assets in a hack of the platform.

Thailand’s Ministry of Finance has announced a new tax measure that will mean tax exemptions on crypto trading gains over a five-year period in an effort to promote the Southeast Asian country as a global crypto hub. According to a statement published to a government website publicizing the introduction of the measure, Deputy Finance Minister Julapun Amornvivat said that the tax break will apply to market participants in Thailand who trade digital assets through exchanges, brokers and dealers licensed under the Digital Assets Business B.E. 2561 legislation, from Jan. 1, 2025 through Dec. 31, 2029. The deputy minister believes that the new measure will put Thailand on the right footing in developing the crypto sector, while that sectoral development will be monitored all the while by the Thai regulator, the Securities and Exchange Commission (SEC).  Amornvivat is conscious of a need to balance nurturing the crypto sector with full compliance in terms of anti-money laundering (AML) policies, in line with international practice as set out by the Financial Action Task Force (FATF).Photo by Kaboompics.com on PexelsGreater transparencyThe deputy minister also confirmed upcoming changes that would lead to greater transparency. He stated:”The Revenue Department is in the process of implementing the OECD’s Crypto-Asset Reporting Framework (CARF), which is an exchange of digital asset data with countries around the world, which will make digital asset transactions more transparent.” Taking to X, Amornvivat claimed that the policy aligns with OECD standards, and said it "is another important step in raising the economic potential of [Thailand] and is an opportunity for Thai entrepreneurs to grow on the world stage." This is not the first time the Thai authorities have looked at crypto-related taxation. Back in March the government approved a tax break targeting investors who generated capital gains from holding investment tokens. At that time, it was outlined that the government wanted to incentivize the use of investment tokens for fundraising purposes. In the medium term, Amornvivat believes that these measures will lead to growth in the overall Thai economy and an increase in tax revenue by approximately one billion baht ($30.6 million). Bitkub, Thailand’s largest crypto exchange, didn’t waste any time in responding to the development. On X, it advised its user base that “the wait is over,” with tax-free trading now possible on the platform. Competing global centersAssad Dar, a founder of Dubai-based Web3 gaming startups OYA Play and MoonGaming, took to social media to draw attention to the development in the context of initiatives being taken elsewhere to drive crypto. He described Thailand’s five-year tax break as a “big move,” while considering incentives offered in places like Dubai and Pakistan recently. He added:”Each place is trying to support crypto in its own way.” While competition around the world heats up to attract more crypto-related development and business activity, some fear getting left behind. Indian crypto influencer Rananjay Singh noted this latest development in Thailand while pointing out that crypto market participants in India still have to pay 30% tax on crypto-related capital gains as well as 1% tax deducted at source (TDS).