Stablecoin initiatives expand across Asia and the Middle East as market grows

Taiwan Proposes New Crypto Business CategoryWith regulation having trailed the crypto innovation, more recently it seems like every day brings further developments, with the latest installment seeing Taiwan take a significant step forward. Officials in Taipei are proposing the classification of crypto regulations within their own novel business category.Photo by Jack Brind on UnsplashFostering self-regulationThe move aims to potentially allow cryptocurrency-related companies to establish industry associations, ultimately fostering the creation of self-regulatory guidelines. The Ministry of Economic Affairs, in a recent announcement, unveiled its draft amendment to the Standards of Classification of Commercial Group regulations. This proposed amendment centers on the inclusion of a distinct category for digital asset services.An official from the economic ministry informed The Block that the freshly introduced business category outlines the scope of operations within the cryptocurrency sector. This encompasses various activities, such as cryptocurrency to fiat or digital token exchanges, facilitating cryptocurrency transfers, offering services for crypto storage and management, and providing assistance related to cryptocurrency issuance or sales.The official further elaborated that cryptocurrency firms will be permitted to form industry associations once the proposed business category is successfully incorporated into the relevant regulations. Seeking public input, the ministry anticipates finalizing the amendment in collaboration with the Ministry of the Interior in either mid- or late-October.Encouraging trade associationsBy allowing the establishment of industry associations, cryptocurrency companies can proactively devise self-supervisory rules that address industry-specific challenges and concerns. This move is anticipated to bolster transparency, security, and responsible conduct within the cryptocurrency ecosystem.Taiwan’s approach to virtual asset services providers (VASPs) has mandated compliance with anti-money laundering laws since the implementation of anti-money laundering regulations by the Financial Supervisory Commission in July 2021. However, the overall industry remains relatively unregulated within the country.Binance, the world’s largest cryptocurrency exchange, has recently embarked on the process of obtaining registration for anti-money laundering compliance under the FSC.Regulatory guidelines being draftedAs the regulatory landscape evolves, Taiwan’s FSC, which assumed its role as the principal regulator overseeing the crypto industry in March, is actively formulating comprehensive guidelines. These guidelines will cover trading and payment aspects associated with cryptocurrencies for VASPs.An FSC official revealed that the agency plans to unveil the VASP guidelines by the end of September. It’s understood that the guidelines will comprise thirteen regulatory principles. It’s believed that the issuance of crypto assets will be permitted but that stablecoin issuance will be prohibited. One prerequisite for the issuance of digital assets will be a requirement to accompany that issuance with a comprehensive whitepaper, detailing fundamental and necessary information that investors can review, relative to the token offering.Taiwan’s proposition of a novel business category signifies a pivotal move towards enhanced self-regulation and industry cohesion within the cryptocurrency sector. As the regulatory framework takes shape, the introduction of self-regulatory guidelines is poised to contribute to the responsible growth of the cryptocurrency industry in Taiwan.

BU Technology to provide digital asset issuance platform to Ret GamesSouth Korean blockchain firm BU Technology has partnered with digital asset management service provider Byffin to supply a digital asset issuance platform built on its distributed ledger core optimization solution, All-in-one DLT Core (ADC), to Seoul-based Web3 gaming studio Ret Games, according to local news platform Financial Review on Thursday.Photo by GuerrillaBuzz on UnsplashElevating gaming dynamicsAccording to the article, the digital asset issuance platform will be on-boarded to Ret Games’ Play-to-Earn (P2E) gaming platform Pomerium, which houses flagship games like Pome Run and Pome Rumble.“This contract can be seen as proof that ADC is the most competitive blockchain solution in the gaming field,” BU Technology said. “The number of companies submitting inquiries about adopting ADC has increased drastically compared to the previous quarter, especially considering the advantages of ADC like blockchain data processing speeds of over 10,000 transactions per second (TPS).”With ADC and the digital asset issuance platform, Ret Games will be equipped with a high-speed blockchain system that can be utilized in games. The gaming company will also be able to receive a portion of the fees that are paid when issuing digital assets such as game items, thereby yielding increased sales and profits.Safeguarding gaming integrityNotably, Ret Games has generated some KRW 18 billion (approximately $14 million) in revenue through the game data verification system developed by Pomerium called “Guardians”, which validates forged and irregular data in the Pomerium ecosystem and distributes token rewards in return.“Ret Games will be able to detect and verify abnormal transactions of off-chain and on-chain game data for users with the Guardians system installed on their PC,” BU Technology explained. “Web3-based business can also be facilitated since users who participate in the validation of game data are rewarded with PMG tokens.” PMG is the governance token for Pomerium.

British multinational banking conglomerate Standard Chartered has partnered with global crypto exchange OKX in Dubai on a collateral mirroring pilot program.Photo by appshunter.io on UnsplashOff-chain collateralIn a press release published on April 10, the companies set out details of the collaboration. The initiative will facilitate institutional clients to utilize digital assets and tokenized money market funds for trading as off-chain collateral. Trading activity requires the ongoing movement of funds and assets between custodians and exchange platforms. The activity is expensive and slow. Back in 2023, OKX had collaborated with crypto custodian Komainu and asset manager CoinShares to enable collateral mirroring to overcome this operational inefficiency. In that instance, CoinShares was enabled to trade on OKX using a collateral mirroring facility provided by OKX with Komainu acting as asset custodian. This latest initiative has also seen OKX work with alternative investment management firm Brevan Howard, global investment management company Franklin Templeton and local regulator in Dubai, the Virtual Assets Regulatory Authority (VARA).  Developed within regulatory frameworkThe collateral mirroring facility has been established on a pilot program basis to start with, having been developed within the regulatory framework established in Dubai by VARA. Standard Chartered will act as the digital asset custodian as part of the arrangement.  The press release points out that Standard Chartered is a Globally Systemically Important Bank (G-SIB), asserting that this will afford clients a higher level of security. By not having to manually move the digital assets, there is an additional security-related process improvement, given the ongoing risks associated with digital assets held on exchanges due to incidents of hacking. Hong Fang, OKX president, provided some insight into why the company has partnered with Standard Chartered, stating:”By leveraging Standard Chartered's position as a top custodian globally, as well as OKX's market leadership in cryptocurrency trading, the partnership sets an industry standard for current and potential institutional clients to deploy trading capital at scale in a trusted environment." OKX CEO Star Xu outlined on X that the service offering is geared towards tokenized money market funds with the aim of improving capital efficiency and counterparty risk protection. Standard Chartered launched its crypto custody services in Dubai last September. The service was established in partnership with Brevan Howard Digital, having been licensed by the Dubai Financial Services Authority (DFSA), the independent regulator for financial service providers located within the Dubai International Financial Centre (DIFC), an economic free zone. In October 2024, OKX selected Standard Chartered as its digital asset custodian for the crypto exchange platform’s institutional clients. First clientsBrevan Howard Digital and Franklin Templeton will participate as the first clients to trial the new service offering. Furthermore, as part of the collaboration, OKX platform users will gain access to tokenized on-chain assets developed and offered by Franklin Templeton. Franklin Templeton’s head of digital assets, Roger Bayston, commented on the firm’s on-chain product offering, stating: “By ensuring assets are minted on-chain, we enable true ownership, allowing them to move and settle at blockchain speed – eliminating the need for traditional infrastructure.”