Samjong KPMG and Xangle to host a seminar to discuss crypto regulatory compliance

Korean Firms Join Forces to Expand the Security Token MarketSouth Korean tech firm AIITONE announced today that it signed a memorandum of understanding (MOU) with real estate developer Korea Asset Development to expand security token businesses, according to a report by news agency Newsis.Photo by Shubham Dhage on UnsplashVentures into fintechAIITONE is renowned for its expertise in applying extended reality (XR) technology to smart defense and metaverse projects. In their latest strategic move, they have hired a blockchain tech group to venture into fintech sectors, with a specific focus on security tokens.Real estate expertiseKorea Asset Development, a real estate developer engaged in multiple projects nationwide, is currently involved in the development of upscale housing in Seoul and Busan, high-end residences in Songdo, as well as luxury resorts in Chungcheong and Gangwon Provinces.Through their collaborative endeavors, AIITONE and Korea Asset Development seek to capitalize on their respective technological expertise and knowledge. They plan to share their know-how and establish a comprehensive cooperation framework, specifically targeting content development associated with security tokens. Furthermore, both parties have committed to consistently exploring new areas of cooperation.Security token opportunitiesIn particular, the two companies have identified real estate due to its relatively easier valuation compared to other assets. The market for real estate security tokens in Korea is projected to reach 34 trillion KRW ($26 billion) by 2024. It is estimated that financial services, including real estate, account for approximately 70% of the total security token market size.AIITONE CEO Lee Jin-yup underlined the importance of cooperation with a range of players that bring diverse resources, considering that the security token market involves high-value tangible assets such as real estate, music, and artworks. He said the partnership with Korea Asset Development will help the company secure a competitive edge in the burgeoning real estate security token market.Development in JapanNot just South Korea, but other East Asian nations too are experiencing significant strides in the security token market. Japan serves as a case in point, with companies like Mitsui & Co. Digital Asset Management (Mitsui & Co. DAM) exploring the potential of this emerging market.Mitsui & Co. DAM last month introduced a platform that allows retail investors to access security tokens backed by real-world assets. This initiative opens up previously inaccessible investment opportunities to a broader range of participants.Moreover, the Tokyo Metropolitan Government has taken an active role in supporting security token businesses within its jurisdiction. From May 31, 2023, to February 29, 2024, the government runs a subsidy program for security token projects based in the capital city. Under this program, eligible businesses can receive subsidies of up to 5 million yen ($36,000) per project.

Binance to Incubate Startups, Provide Blockchain Education in Incheon CityBinance, the world’s largest cryptocurrency exchange by trading volume, intends to educate students on blockchain technology and foster startups in Incheon, according to Korean blockchain media Decenter.Photo by Hon Kim on UnsplashBinance’s planOn Tuesday, at the 2023 Incheon Metanomics event, Leon Sing Foong, the Head of Asia-Pacific Operations at Binance, emphasized the strategic advantages of Incheon’s location near the nation’s capital and its prestigious universities, which make it an ideal hub for attracting top talent. Binance has plans to offer blockchain education to college students, as well as incubation services for startups in Incheon. Additionally, the prominent cryptocurrency exchange intends to provide guidance to blockchain projects and generate public interest in the field.Effective communicationFoong also emphasized the importance of effective communication between cryptocurrency companies and government entities. He suggested that clear and consistent crypto regulations would enable international companies to secure large-scale funding, while unrestricted capital inflow would facilitate efficiency and innovation within the industry. Foong also noted that attracting capital to the Incheon Free Economic Zone (IFEZ) requires a predictable and stable regulatory environment. To achieve these goals, Foong proposed that companies and governments engage in constructive dialogue on regulatory matters.Incheon’s five-year initiativeMeanwhile, Incheon has allocated 13.3 billion KRW (equivalent to $10 million) for a five-year urban blockchain initiative that will run until 2026, as per Incheon City’s press release. Since last year, the city has been conducting pilot programs utilizing blockchain technology for public parking and recycling systems.During the conference, IFEZ Commissioner Kim Jin-yong said, “We are dedicated to offering support and constructing infrastructure to attract enterprises to the IFEZ, enabling them to drive innovation in high-tech industries.”Mayor Yoo Jeong-bok of Incheon City highlighted the city’s aspirations to become a forward-thinking city and a major hub for blockchain technology. He emphasized Incheon’s commitment to fostering collaboration among various sectors to create a diverse range of exceptional services and innovative business models.

HSBC Expands Offering to Include Crypto ETFs in Hong KongThe Hong Kong and Shanghai Banking Corporation (HSBC), the largest bank in Hong Kong, has reportedly introduced its first cryptocurrency services for local customers.According to journalist Colin Wu’s tweet on Monday, HSBC now allows its customers to buy and sell Bitcoin-based exchange-traded funds (ETFs).Photo by Cheung Yin on UnsplashOffering three crypto ETFsHSBC’s cryptocurrency services specifically focus on the cryptocurrency ETFs listed on the Stock Exchange of Hong Kong. Currently, the exchange offers three crypto ETFs, including CSOP Bitcoin Futures ETF, CSOP Ethereum Futures ETF, and Samsung Bitcoin Futures Active ETF.The introduction of these services will provide Hong Kong users with more exposure to cryptocurrencies. As of March 2022, HSBC Hong Kong had approximately 1.7 million active mobile customers, with about 95% of all retail transactions processed online. Plenty of the customers that currently access TradFi financial services don’t touch crypto-native products. Bridging this gap and bringing crypto to a more traditional financial services client base is a major step towards mass market adoption of crypto.Educating the marketIn addition to the roll-out of cryptocurrency services, HSBC reportedly launched the Virtual Asset Investor Education Center. The initiative is designed to protect investors from cryptocurrency-related risks by requiring them to read and confirm educational materials and risk disclosures before investing.The Virtual Asset Investor Education Center is accessible through HSBC’s virtual asset-related products, such as the HSBC HK Easy Invest app, HSBC HK Mobile Banking app, and online banking.This is also a significant step forward. It’s entirely valid that while there are good actors in the crypto space, the sector has also had a lot of sharp practice that reflects badly on it. This alone may be reason enough for many conventional investors not to touch digital assets. Their trust in a platform like HSBC will allow them to include crypto within their portfolios.The second aspect to that reluctance is rooted in a misunderstanding of digital assets, the risks involved, and how risk can be minimized. HSBC has clearly identified this by taking the initiative and launching its Virtual Asset Investor Education Center.Crypto ETF growth potentialThis development follows reports in mid-June that the Hong Kong Monetary Authority (HKMA) had exerted pressure on major banks to accept crypto exchanges as clients. The central bank and regulator specifically questioned HSBC and Standard Chartered about their reluctance to onboard crypto exchanges as clients.HSBC’s move to offer cryptocurrency services in Hong Kong reflects the growing acceptance and recognition of cryptocurrencies in the financial industry. By providing access to crypto ETFs, HSBC aims to cater to the increasing demand for digital assets among its customers in the region.The crypto ETF products that are currently on offer in Hong Kong are very recent. As an example, Samsung’s Bitcoin futures ETF was launched in January. The product has already seen a lot of interest due to growing uncertainty relative to the traditional global financial system.A report produced by the Hong Kong stock exchange in April found that crypto ETFs have the potential to play a significant part in unlocking the next phase of digital asset expansion in Asia. Clearly, HSBC have taken notice with this move to further enable that potential.