Further Trials Required Before Determination of eHKD Launch Date

FTX Seeks Exclusion of Dubai Unit from Bankruptcy ProceedingsFailed crypto exchange FTX, which filed for bankruptcy in November, is now aiming to exclude its Dubai unit from the ongoing restructuring proceedings unfolding in the United States.Photo by Roman Logov on UnsplashNo previous business activityThe motion, filed with the bankruptcy court in Delaware on Wednesday, comes as FTX contends that its Dubai branch had not engaged in any business activities prior to the bankruptcy declaration, making its participation in the rehabilitation efforts unlikely.In the recent court filing on August 2, FTX put forth its argument that its Dubai unit, FTX Dubai, held a balance sheet that was solvent. Consequently, the exchange proposed that initiating a voluntary liquidation process in line with the laws of the United Arab Emirates (UAE) would expedite the distribution of its positive cash balance, settling liabilities, and liquidating assets.FTX Dubai, a wholly-owned subsidiary of FTX’s European arm, holds a sum of approximately $4.5 million across various accounts. However, $4 million of this amount remains restricted by the Virtual Assets Regulatory Authority (VARA) of Dubai, serving as a security measure for its license as a virtual asset service provider.Expired licensingFTX Dubai was originally awarded a license by VARA in July 2022, although it never got to a point where it offered any crypto-related services based on that license. On May 31 of this year, FTX Dubai management was informed by VARA that the regulator would not seek to renew the license if FTX Dubai didn’t act to terminate it. The license was subsequently suspended on July 12 by VARA.Licensing could have been useful to a new operator coming in to run the business. Earlier this week, the FTX Debtor filed a restructuring plan that leaves a path open towards relaunching the FTX International business outside of the United States. It’s clear that the current regulatory environment in the US is such that it’s simply not an attractive option to establish a restructured FTX business there.The FTX Debtor and its advisors are engaging with bidders for the business. In establishing a business on the right footing, it may be just as well that licensing will start afresh. To settle market doubts, the new entity will need to achieve a high level of compliance and industry-leading customer protections.FTX Dubai is now anticipated to collaborate with the designated liquidator to carry out essential administrative procedures, ensuring a systematic and efficient execution of the liquidation process. The company’s decision to file for bankruptcy on November 11, 2022, initiated bankruptcy proceedings for a total of 102 associated entities worldwide, reflecting the substantial impact of its financial turmoil.The matter is scheduled to be addressed in the court’s first hearing on August 23, shedding light on how the court will respond to FTX’s motion to remove its Dubai unit from the overarching bankruptcy proceedings in the US. This development underscores the complexities of a cross-border crypto bankruptcy, highlighting the intricacies of global regulatory frameworks in this evolving sector.

Hong Kong's debut of Bitcoin and Ether exchange-traded funds (ETFs) faced a tough start on their first day of trading, with volumes falling far below the record-breaking figures seen in the United States earlier in January 2024. Tough act to followThe launch of six spot Bitcoin and Ether ETFs, managed by prominent firms including China Asset Management, Harvest Global, Bosera and HashKey, marked a significant milestone for Hong Kong's cryptocurrency market. However, initial trading volumes indicated a notable contrast with the groundbreaking volumes witnessed during the debut of spot Bitcoin ETFs in the United States. On their inaugural day, the total trading volume of the six new crypto ETFs in Hong Kong amounted to 87.58 million Hong Kong dollars ($12 million). This figure, while significant, paled in comparison to the $4.6 billion trading volume recorded for U.S. spot Bitcoin ETFs on their first day, making the U.S. investment funds a tough act to follow. Despite the disparity, industry experts like Justin d'Anethan, head of APAC business development at crypto market maker Keyrock, viewed the Hong Kong ETFs' performance positively within the local market context.Photo by Simon Zhu on UnsplashAbsence of stakingD'Anethan told The Block that while the trading volume in Hong Kong didn't match the U.S. debut, it reflected a noteworthy level of investor interest, particularly considering the market dynamics in Hong Kong, which lacks access to mainland China investors. Bloomberg ETF Analyst Eric Balchunas suggested on X that people expected too much and that in reality, it was a good first day’s trading. In an interview with Bloomberg, China Asset Management CEO Yimei Li stated that the products open the door “for a lot of RMB holders.” They didn’t show up on day one as d’Anethan pointed out, and he further noted that the absence of staking rewards for Hong Kong's spot Ether ETFs was a notable factor affecting investor decisions. Data from the Hong Kong Stock Exchange (HKEX) cited by Cointelegraph illustrated the relatively subdued performance of the newly launched ETFs. Among them, the Bosera HashKey Bitcoin ETF and Ether ETF recorded modest trading volumes, while the China Asset Management (CAM) Bitcoin ETF demonstrated stronger traction, attracting significant trading volume by the closing bell. Prior to trading, CAM's subscription size for its spot Bitcoin and Ether ETFs drew substantial interest, totaling $140 million during the initial offering period. This heightened anticipation was further fueled by the success of HKEX's cryptocurrency futures ETFs, which garnered $529 million in net inflows in the first quarter of 2024. Fee exemptionsIn an effort to stimulate investor participation, local fund managers and brokerages in Hong Kong offered fee exemptions for the new crypto ETFs. Harvest waived its management fee for six months, while Bosera extended a fee waiver period of four months. Despite the optimism surrounding the launch, potential access to the ETFs by mainland Chinese investors remains uncertain, subject to Know Your Customer (KYC) policies. Meanwhile, the Securities and Exchange Commission's (SEC) stance on Ether ETFs in the U.S. complicates the prospects of listing such products in the near future. While Hong Kong's debut of Bitcoin and Ether ETFs faced challenges in matching the fervor witnessed in the U.S., it nevertheless represents a significant step forward for the region's cryptocurrency market, signaling growing interest and participation in digital asset investments.

BitBunny, a South Korean mobile app that distributes rewards based on walking activity, now offers rewards in the form of Bitcoin, according to an article by local news outlet TechM on Tuesday (KST).Photo by Thom Milkovic on UnsplashUnlocking rewardsBitBunny allows users to earn Bitcoin by completing missions like walking, checking daily attendance, inviting other friends to use the app, watching advertisements and participating in quizzes and games. Last Friday, the app added a new feature called "Catch the Bunny," a game where users can earn up to 10,000 points, or “coins”. These coins can either be used as cash when exchanged for vouchers – which can be used at various brands like Starbucks or Burger King – or invested in cryptocurrencies like Bitcoin, Ethereum, Ripple and Dogecoin. Due to these features, the app surpassed 100,000 users within just three months of release. BitBunny's vision"BitBunny's growth is an example of how mobile app technology and crypto are converging in everyday life, creating new user experiences," said Lee Kyung-tae, Team Lead at BitBunny. "We will continue to try different things to keep users interested and engaged." With a commitment to experimentation and user engagement, BitBunny is poised to redefine the way that users interact with both mobile apps and cryptocurrencies, offering a glimpse into a more integrated and rewarding digital future.