SBINFT and JPNFT Collaborate to Establish A Secure NFT Market in Japan

Upbit D Conference participants share insights on Web3 and blockchainBlockchain specialists from 29 countries gathered on Monday (local time) at Upbit D Conference (UDC) 2023 in Seoul to explore capital markets in the forthcoming Web3 era. This era is characterized by user-controlled, communal data management, a notable shift from the Web2 space where major tech corporations held dominant control over data.Organized by Dunamu, the operator of South Korea’s Upbit cryptocurrency exchange, the conference featured 39 experts, focusing on the transformative potential of blockchain technology in this new internet phase.Photo by Shubham Dhage on UnsplashAsset tokenization and investment opportunitiesAccording to a report by the Asia Business Daily, one of the key speakers at the conference, Wally Yu, a Solutions Architect at San Francisco-based Chainlink Labs, delved into how cross-chain solutions and asset tokenization could add to the financial industry. He explained that Chainlink’s Cross-Chain Interoperability Protocol (CCIP), designed to connect various blockchains, is only beginning to reveal its capabilities in integrating with traditional financial markets. Yu pointed out the growing interest from banks in tokenizing their conventional assets and transferring them to the blockchain. This move, he suggested, could lead to increased liquidity and open up new investment opportunities.Yu also compared the current DeFi market to traditional sectors like stock, real estate, and derivatives, noting DeFi’s relatively smaller scale. However, he underlined blockchain’s transparency as a key advantage over traditional markets, where transparency is often lacking. According to Yu, the adoption of blockchain by traditional financial firms could address longstanding issues more effectively.Looking ahead to the Web3 era, Yu envisioned a scenario where different tokens are interconnected, potentially bringing an estimated $900 trillion worth of assets onto the blockchain. This, he believes, would significantly enhance liquidity in the financial markets.From Web2 to Web3During the conference, Korean mobile network provider SK Telecom’s (SKT) Vice President, Oh Se-hyun, outlined the company’s forward-looking strategy to transition its 30 million subscribers from Web2 to Web3. She highlighted SKT’s search for high-value markets to expand its business scope, underscoring the company’s active efforts in constructing Web3 infrastructure. This strategic pivot aligns with their vision for the upcoming Web3 era.SKT, which established its Web3 division in 2017, initially engaged in developing a private mainnet. However, the company has since shifted its focus towards services aimed at boosting customer engagement, such as custody, web and app services. Oh emphasized the need for Web3 wallets to support a diverse range of assets and decentralized applications (dApps), but she stressed that ease of use is paramount. She views that these wallets will serve as gateways for customers entering the blockchain space.SKT has developed and is improving its own Web3 wallet, dubbed Wallet T. Oh shared her belief that the future of financial business models will pivot from traditional and big-tech banks to those based on public chains. In preparation for this shift, SKT is contemplating strategies to embrace blockchain-based Web3 services.Crypto regulationThe conference also touched on the potential integration of virtual assets within regulatory frameworks. There’s growing anticipation in the market for the approval of spot bitcoin exchange-traded funds (ETFs) by the United States Securities and Exchange Commission, especially following the inclusion of asset manager BlackRock’s proposed spot bitcoin ETF in the Depository Trust and Clearing Corporation’s (DTCC) clearing-house eligibility file.Emily Parker, Executive Director at CoinDesk, mentioned that a spot bitcoin ETF is on the horizon in the U.S. She anticipated that such a development would not only boost cryptocurrency prices but also positively impact the market for non-fungible tokens (NFTs). Echoing this sentiment, Oh Se-hyun from SKT predicted that the approval of a spot bitcoin ETF could unlock access to a $30 trillion market.SKT’s Oh also addressed the complexities surrounding the regulatory landscape for cryptocurrencies. She acknowledged the challenge facing authorities in developing these regulations all at once, highlighting the gradual progress in this area. She cited the outcome of Ripple’s lawsuit in the U.S., which resulted in Ripple’s XRP tokens being classified differently for different investors: as a security for institutional investors but not for retail investors. Additionally, Oh pointed to the upcoming Markets in Crypto-Assets Regulation (MiCA) in the European Union, slated for implementation in December 2024. She emphasized that the establishment of such regulatory guidelines brings clarity and reduces uncertainty, which can be reassuring for businesses operating in the crypto space.Providing further insights into this matter, Kim Gap-rae, a senior researcher at the Korea Capital Market Institute (KCMI), spoke about the importance of regulatory clarity in the cryptocurrency sector. He pointed out that it’s more crucial for governments to have clear regulations rather than focusing on the extent of regulation. Understanding new regulatory or legislative trends is essential for governments as they look to develop new infrastructures.According to Kim, a potential spot bitcoin ETF approval in the U.S. could prompt South Korea to consider a similar approval. However, he noted that Korea currently lacks a regulatory framework for Bitcoin custody, which could lead to a competitive environment among crypto companies in the country. Kim believes that a deeper understanding of custodian regulations will enable better adaptation to new types of ETFs and foster their growth in Korea.

Hong Kong Urged to Issue HKD StablecoinA new policy proposal is urging the Hong Kong government to take a bold step by issuing its own stablecoin, HKDG, pegged to the Hong Kong dollar. The aim is to compete with established stablecoins like USDT and USDC, according to a paper co-authored by notable experts in the field.The proposal, co-authored by Wang Yang, Vice Chancellor of the Hong Kong University of Science and Technology and Chief Scientific Advisor of the Hong Kong Web3 Association, angel investor Cai Wensheng, BlockCity founder Lei Zhibin, and Ph.D. student Wen Yizhou, stresses the significance of stablecoins as a link between traditional finance and the digital economy.Photo by Chapman Chow on UnsplashHKD stablecoin benefitsThe authors believe that a Hong Kong Dollar-pegged stablecoin can enhance financial inclusiveness, improve transaction efficiency, reduce costs, strengthen payment systems, and boost Hong Kong’s fintech capabilities.The experts argue that the current plan of allowing private institutions to issue stablecoins is not ambitious enough and may result in limited market share. They draw a comparison with Singapore’s XSGD stablecoin, issued by Xfers, which only has a market cap of $65 million, compared to the combined market capitalization of over $110 billion for USDT and USDC. With Hong Kong’s foreign exchange reserves surpassing $430 billion as of March, an HKDG stablecoin backed by the government would offer higher credibility and lower risk.Private vs. public issuanceWhile the proposal acknowledges potential risks, such as legal and regulatory challenges, technical risks, and short-term exchange rate fluctuations, it argues that government-issued HKDG would bear lower risks compared to stablecoins issued by private institutions. The authors assert that HKDG would benefit from government regulation and the transparency provided by blockchain technology.Furthermore, the paper suggests that HKDG could aid in Hong Kong’s de-dollarization efforts and challenge the dominance of the US Dollar in the crypto ecosystem. It is believed that HKDG could provide additional liquidity for government investment projects, facilitate the digitization of traditional assets, foster financial innovation and competitiveness, and increase transparency.Recent months have seen Hong Kong demonstrate its intention to establish itself as a global hub for the crypto industry. To support this, a Web3 task force has been set up to cultivate a thriving ecosystem in the region.There has been plenty of activity of late relative to stablecoin development in Asia. At the end of May, Hong Kong-based qualified custodian and trust company First Digital Trust, announced plans to introduce a US dollar stablecoin, issued and regulated in Hong Kong. Last month it emerged that Japan’s largest bank, Mitsubishi UFJ Financial Group, Inc. (MUFG), is in discussions regarding the issuance of stablecoins on its blockchain network.Competing internationallyIssuing a government-backed stablecoin could be a transformative move for Hong Kong’s fintech landscape. By leveraging its substantial foreign exchange reserves and embracing blockchain technology, Hong Kong could create a stablecoin that not only competes with established players but also promotes financial inclusiveness and strengthens its position as a fintech leader.With the potential benefits appearing to outweigh the identified risks, it still remains to be seen whether the Hong Kong government will adopt this proposal and pave the way for an HKDG stablecoin in the near future.

KuCoin resolves lawsuit through settlement and New York market exitKuCoin, one of the largest global cryptocurrency exchanges, has arrived at a comprehensive settlement with the authorities in the state of New York in the United States, agreeing to pay $22 million.Photo by Michael Discenza on UnsplashSubstantial fine and refundsThe settlement not only involves a substantial fine but also includes refunds to New York investors and the cessation of trading activities in the state. This resolution comes amidst an assertive effort by New York authorities to shape and regulate the crypto landscape within the state.According to a statement released by New York Attorney General Letitia James on Tuesday, KuCoin will refund a total of $16.7 million to 177,800 New York investors. In addition to the refunds, KuCoin will pay a $5.3 million fine to the state.The settlement addresses allegations that KuCoin failed to register as a securities and commodities broker-dealer while falsely presenting itself as a cryptocurrency exchange.Taking to social media platform X, James wrote:”My office is making crypto platform @kucoincom pay over $22 million for illegally operating in New York. KuCoin is also banned from doing business in our state. Shady cryptocurrency platforms must play by the same set of rules as everyone else or face the consequences.”At the time of taking action against KuCoin in March, James described the lawsuit as “our eighth action to rein in shadowy cryptocurrency platforms that disregard our laws and put New Yorkers at risk.”Lack of registrationKuCoin, based in the Seychelles, allows investors to trade digital assets through its website and app. However, the state of New York argued that KuCoin could not legitimately claim to be an exchange due to its lack of registration with the U.S. Securities and Exchange Commission (SEC) and the proper designation by the Commodity Futures Trading Commission (CFTC), as mandated by state law.Ranked as the fourth-largest exchange by spot and derivatives trading volume, KuCoin’s KCS token, a profit-sharing token on the platform, has experienced a 39% increase since the start of the week. At the time of writing, it has a unit price of $13.80. This surge is a consequence of the clarity and finality brought about by the settlement, alongside rising expectations for a U.S. exchange-traded fund (ETF) directly investing in Bitcoin, sparking a broader rally in lesser-known cryptocurrencies over the past month.Potential rumorsKuCoin CEO Johnny Lyu took to the X platform on Tuesday to outline details of the settlement. Interestingly, Lyu included this notification:”I also want to give you a heads-up about potential rumors surfacing in the next few weeks. Please stick to the official website of KuCoin for accurate information.”While the settlement may have brought a certain degree of clarity to the KuCoin platform, Lyu’s comment suggests that there may be other issues about to emerge in the short term.The lawsuit against KuCoin is part of a broader regulatory trend in New York, with Attorney General James having previously filed a similar complaint against CoinEx. Additionally, a settlement in January involving crypto companies Nexo Inc. and Nexo Capital Inc. resulted in a financial resolution of up to $24 million for New York and nine other states.