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Regulatory breach sees Philippines initiate blockade on BinanceIt’s been a very challenging year for global crypto platform Binance — one that doesn’t appear to be improving with the latest move to block access to the platform in the Philippines.Photo by Alexes Gerard on UnsplashUnlicensed to tradeIn a noteworthy development, the Philippines Securities and Exchange Commission (SEC) declared on Tuesday its intention to block access to the Binance platform due to regulatory irregularities.The SEC asserted in a statement that Binance lacks the necessary license to operate in the Philippines, cautioning the public against engaging in investment products on the platform. The regulator stated:”BINANCE is NOT REGISTERED as a corporation in the Philippines and OPERATES WITHOUT THE NECESSARY LICENSE AND/OR AUTHORITY.”The regulatory body is actively working to have Binance blocked in the country, citing concerns about unregistered investment products. The impending ban is set to take effect within three months, allowing investors a window to exit their positions held through Binance.Pushback on advertisingIn addition to its attempts to block access to the platform, the SEC has also approached tech giants Google and Meta (Facebook’s parent company), requesting the blocking of Binance advertisements on their platforms within the country. This is a response to social media campaigns designed to attract Filipino investors to the embattled cryptocurrency exchange. While users can still download the Binance app from Google and Apple app stores in the Philippines, the extent of investor activity in the country remains uncertain.Follows U.S. regulatory actionThese actions in the Philippines come hot on the heels of Binance’s CEO Changpeng Zhao (CZ) stepping down and pleading guilty in a U.S. money-laundering case. The Philippines’ ban adds to Binance’s challenges as it aims to expand in Southeast Asia amid legal troubles in the U.S. and restrictions on operations in China.Over the course of a three-month period earlier this year, the world’s largest crypto exchange platform lost its ability to trade in Germany, Canada, Belgium, the Netherlands and Cyprus. Additionally, French authorities have been investigating the platform for alleged illegal provision of digital asset services and aggravated money laundering.Facing regulatory pushback in the U.S. and Europe, Binance appeared to be concentrating on making further in-roads in Asian markets over the course of this past year. It had recently pursued a joint venture with Gulf Energy in Thailand to launch a new digital assets exchange.Media reports previously suggested that Binance was considering acquiring a Philippine company to obtain operating licenses in the country. The SEC’s move to ban the platform follows a warning issued last year against using Binance, and it represents a broader effort to regulate the cryptocurrency sector and protect the public interest.The recent guilty plea by CZ for violating U.S. money laundering laws has added to the legal woes of the cryptocurrency giant. CZ agreed to personally pay $50 million in penalties as part of a $4.3 billion settlement to resolve investigations into Binance’s practices. He may also still face prison time in the U.S. In the Philippines, the SEC warns that Section 28 of the Securities Regulation Code (SRC) allows the application of a fine of up to five million pesos ($90,000) and a maximum prison term of 21 years.

Following the recent bitcoin boom, transactions in cryptocurrencies among Korean investors have surged, significantly benefiting local banks that have made contracts with Korean crypto exchanges to offer real-name accounts for crypto investors. As the price of bitcoin soared to as high as KRW 90 million ($67.6 million) in Korea on Thursday, online-only bank Kbank saw an uptick in trading fee revenue, according to local media outlet The Seoul Economic Daily. Kbank is a partner with crypto exchange Upbit, which accounts for 70% of the Korean crypto market.  Under the current law, Korean crypto exchanges offering trading against Korean won must secure real-name accounts from a bank. These banks typically earn fees of KRW 300 to KRW 1,000 per transaction. Currently, other than Kbank, NongHyup Bank offers real-name accounts to Bithumb, Kakaobank to Coinone, Shinhan Bank to Korbit and Jeonbuk Bank to Gopax.Photo by Kanchanara on UnsplashCrypto trading volume up 68.2% in a monthAccording to Xangle, a crypto data intelligence platform, the total crypto trading volume in Korea rose by 68.2% between the last week of January and the last week of February, rising from KRW 2.39 trillion to KRW 40.2 trillion. During the same period, the daily average trading volume also grew from around KRW 4 trillion to KRW 5.7 trillion.   In particular, the bitcoin trading volume on Upbit surged to 19,254 BTC on Feb. 28, reaching the second-highest level since Nov. 10, 2022, when the asset’s trading volume stood at 20,710 BTC. After signing the real-name account contract with Upbit in 2020, Kbank raked in KRW 29.2 billion in fees during the last bull market of 2021, which was equivalent to 14% of its annual interest income of KRW 198 billion and exceeded its net income for the year, which stood at KRW 22.5 billion. Increased bank deposits from exchange usersKbank also saw a substantial rise in its balance sheet, with Upbit users depositing around KRW 2.94 trillion into their real-name accounts. The sum is six times greater than the deposits made into NongHyup Bank by Bithumb users, which stood at KRW 547.1 billion.  Experts see that the surge in Kbank’s user base, which recently surpassed 10 million users, is largely attributed to growing excitement surrounding bitcoin. One crypto insider said that crypto trading fees, which have been on the decline for the past 2 years, could take a turn this year, signaling further gains for the affiliated banks.  

Binance Headlines List of Japan FSA Warning Letter RecipientsJapan’s Financial Services Agency (FSA) issued a warning letter on Friday stating that several foreign cryptocurrency exchanges have been operating in the country without proper registration, thereby infringing Japan’s fund settlement laws. The regulatory authority specifically named Binance, Bybit, MEXC Global, and Bitget as the entities in question.The FSA indicated that these exchanges need to register with the agency to continue operating in Japan. Failure to comply with the registration requirements would result in enforcement actions by the FSA, which could include the suspension of their operations in the country.©Pexels/David DibertUnregistered digital asset exchangesThe FSA’s warning letter detailed that the cryptocurrency exchanges mentioned had contravened Japan’s fund settlement regulations by engaging in crypto asset exchange operations without proper registration. The regulatory body emphasized that the current list of unregistered traders may not accurately reflect the current state of unregistered businesses in the country.The FSA intends to continue monitoring the market and taking appropriate regulatory measures to protect consumers and the integrity of the financial system. The agency also encouraged all unregistered operators to register with the FSA to avoid any possible enforcement actions.Clamping down on unregistered exchangesThe FSA’s recent action against unregistered cryptocurrency exchanges is in line with the regulatory body’s ongoing efforts to clamp down on non-compliant operators in Japan. In 2020, the FSA introduced new regulations mandating that all crypto exchanges must register with the agency and obtain a license to operate in the country. These regulations were put in place to strengthen consumer protection and enhance the transparency of the cryptocurrency market. By taking these measures, the FSA aims to foster a more stable and secure environment for the burgeoning crypto industry in Japan.The FSA’s warning to Binance is indicative of the growing regulatory scrutiny that the cryptocurrency industry in Japan and other nations is currently facing. Regulators are increasingly concerned about the potential risks associated with unregulated cryptocurrency exchanges, such as fraud, money laundering, and market manipulation. As a result, many regulatory bodies are implementing stricter rules and guidelines to promote transparency, accountability, and consumer protection in the cryptocurrency market.These regulations aim to create a more secure and reliable environment for investors and industry participants. The FSA’s actions against Binance serve as a reminder to all market players that compliance with regulatory requirements is critical for the long-term success of the cryptocurrency industry.Global regulatory variationWhile Japan is taking steps to implement new regulations for the cryptocurrency and Web3 sectors, the country has not been as stringent in its approach as some other major economies, such as the United States. However, this does not mean that regulators in Japan are not actively monitoring the industry and taking appropriate action where necessary.One example of such action is the recent lawsuit filed by the US Commodity Futures Trading Commission against the popular crypto exchange firm, Binance, and its founder, Changpeng Zhao, over regulatory violations. This highlights the fact that regulatory bodies in different parts of the world are taking a more proactive approach to monitoring the cryptocurrency industry.Moreover, the FSA in Japan issued a formal warning letter to Binance in 2021 for operating without the necessary permissions. This is an indication that the regulatory landscape in Japan is evolving, and that crypto exchanges must comply with the relevant regulations to avoid potential legal repercussions. While the severity of regulatory measures may differ across different jurisdictions, the message is clear: compliance is crucial for the long-term viability of the cryptocurrency industry.