Circle Makes Inroads in Singapore with License Award

Following December's release of proposed fiat-referenced stablecoin regulations, the Hong Kong Monetary Authority (HKMA) has progressed further with the introduction of a stablecoin sandbox.Photo by Nextvoyage on PexelsFormulating a regulatory regimeThe regulatory sandbox, announced through a press release published to the regulator’s website on March 12, encompasses stablecoin currencies beyond the Hong Kong dollar, although the HKMA refrained from specifying particular currencies. Eddie Yue, CEO of the HKMA, emphasized the sandbox's role as a platform for constructive dialogue between the regulatory authority and the industry. Yue stated:"The sandbox arrangement serves as an effective channel for the HKMA and the industry to exchange views on the proposed regulatory regime.”Yue further noted that such engagement is pivotal for formulating regulatory requirements conducive to the sustainable and responsible growth of the stablecoin issuance business. The stablecoin sandbox finds its digital footprint within the International Financial Centre on the HKMA's website. The documentation accompanying the sandbox outlines several key requirements for potential participants. These include demonstrating genuine interest and a feasible plan for issuing fiat-referenced stablecoins in Hong Kong, as well as a concrete strategy for engagement within the sandbox. Additionally, applicants must exhibit a reasonable prospect of compliance with the proposed regulatory framework. Minimum capital requirementsOne notable regulation proposed stipulates that issuers must be Hong Kong-based entities with a minimum capital requirement of HK$25 million ($3.2 million) or 2% of the stablecoin issuance, whichever is higher. The HKMA remains vigilant regarding public announcements by sandbox participants, ensuring that such declarations do not misconstrue endorsement or accreditation from the regulatory authority. In late January, reports suggested discussions between Harvest Global Investment, RD Technologies, Venture Smart Financial Holdings and the HKMA regarding their potential entry into the sandbox. Harvest Global Investment, boasting over $200 billion in assets under management, signifies a significant player in this evolving digital assets space.RD Technologies took to the X social media platform to publicize its approval of the HKMA’s stablecoin sandbox. It also availed of the opportunity to outline that it’s in the process of launching a Hong Kong dollar (HKD)-based stablecoin, which will be known by the short-code HKDR.Hong Kong-based fintech firm AnchorX also chimed in, stating that the sandbox is “a pivotal step forward for the industry, enabling informed dialogue and collaboration between regulators and fintech innovators.” Like RD Technologies, AnchorX is also looking to get involved in the stablecoin business, having developed the AxHKD Hong Kong dollar-based stablecoin, which it is currently beta testing, in collaboration with Conflux Network. Juan Leon, crypto analyst with Bitwise Asset Management, suggested that the move is a great initiative, while calling on the U.S. Federal Reserve Chair Jerome Powell to follow Hong Kong’s example. On the tokenization front, Hong Kong made headlines in 2023 with the issuance of the world's largest native digital bond — a green bond exceeding $750 million. Late last year, it also proposed regulations relative to tokenization of real-world assets.Guidance provided to banks on tokenization, coupled with plans for forthcoming legislation, further solidifies Hong Kong's position as a trailblazer in the realm of digital finance.  

South Korean Job Seekers to Benefit from Digital Badges for License CredentialsSouth Korean job seekers will soon be able to enjoy the convenience of proving their license credentials with digital badges based on non-fungible tokens (NFTs).The South Korean Ministry of Employment and Labor has announced that its affiliate, the Human Resources Development Service of Korea (HRDK), plans to create a mobile application that supports virtual asset wallets. These wallets will allow citizens to conveniently store their HRDK-issued licenses in the form of digital badges.Photo by Gül Işık on PexelsNFT-based digital badgesThese digital badges, which are based on NFTs, will also serve as proof of certification for HRDK’s education and training courses. Decentralized identifiers (DIDs) based on blockchain technology will prevent forgery and counterfeiting and improve personal information protection. The incorporation of gaming elements within NFTs is expected to motivate citizens to engage in continuous learning.Chosen as this year’s state-led blockchain initiative last December, the digital badge project is supported by the Ministry of Science and ICT (MSIT) and the Korea Internet and Security Agency (KISA). HRDK aims to complete the transformation of its 18.5 million issued licenses into digital badges by the end of this year. The project also involves digitizing vocational training certificates issued by the Korea Employment Information Services (KEIS), which has an average annual issuance of 3.6 million certificates. Access to these badges will also be facilitated through not only state-managed mobile ID wallets but also private platform wallets.In the context of employment and career management, individuals have traditionally received paper certificates and had to deliver them to relevant organizations. This process often involved inconvenience, as it required in-person visits, mailing, or scanning. Moreover, individuals faced the hassle of repeatedly obtaining the same certificate due to expiration dates and storage concerns.Seamless certificate managementWith the introduction of the digital badge service, users will be able to download a mobile application on their smart devices. This app will enable them to access their national certificates, allowing them to view their qualification and training completion information at any time. Additionally, users will gain the convenience of instantly submitting or verifying their certificates remotely through their mobile devices whenever necessary.HRDK will further enhance its services through strategic partnerships with credentialing organizations from both the public and private sectors.Kim Young-joong, the Acting President of HRDK, emphasized the significance of national licenses and training certificates as objective measures of individuals’ performance and skills, underscoring their importance in the employment landscape. He further expressed HRDK’s commitment to ensuring customer satisfaction by leveraging cutting-edge technology and efficient data management practices to drive innovation in public services.

Chinese Insurer Founds 2 Crypto Funds in Hong KongChina has been in the headlines lately as the country continues to take a growing interest in cryptocurrencies in spite of a previous clampdown. According to a blog post published last Thursday, a Chinese state-owned insurance company launched two crypto funds, further solidifying the country’s stance on digital assets.©Pexels/Charlie JinChinese crypto resurgenceChinese insurance behemoth, the China Pacific Insurance Company (CPIC) has launched the two cryptocurrency funds in Hong Kong. The funds will be managed by the firm’s asset management unit, CPIC Investment Management, and have been established in conjunction with venture capital and blockchain start-up investment firm, Waterdrip Capital. Furthermore, they will focus on investments in cryptocurrencies and related assets, with a particular emphasis on Bitcoin and Ethereum.Waterdrip was originally founded in Shanghai in 2017, and has previously invested in the Chinese crypto mining sector, together with other blockchain-related projects. The move comes as China continues to make strides towards becoming a leader in the digital currency space. Last year, the country’s central bank announced plans to create its own digital currency, which is currently in the testing phase. The move is seen as a way for China to gain more control over its financial system and reduce its reliance on the US dollar.Hong Kong crypto hubChina’s growing interest in cryptocurrencies has been driven in part by the country’s rapidly growing tech industry. Companies like Tencent and Alibaba are leading the way in digital payments and e-commerce, and many believe that cryptocurrencies will play a key role in the future of online transactions.The launch of these two crypto funds by a state-owned insurance company is just the latest indication of the formative development of Hong Kong as a crypto hub. Its believed that China is treating crypto development in Hong Kong as a manner in which it can determine how digital assets can be utilized subsequently on mainland China.It’s not the first time a state-owned entity has gotten involved in cryptocurrency. Earlier this year, a state-owned company launched two crypto funds in Hong Kong, with a focus on investing in Bitcoin and other digital assets.Previous crypto crackdownDespite China’s growing interest in cryptocurrencies, the country has also taken a tough stance on the industry in the past. In 2017, the Chinese government banned initial coin offerings (ICOs) and shut down local cryptocurrency exchanges. However, it appears that the country’s stance is shifting, with the launch of these two crypto funds serving as a clear indication of China’s growing interest in digital assets.While China’s embrace of cryptocurrencies is seen by many as a positive development for the industry, there are also concerns about the country’s growing influence in the space. With China’s central bank developing its own digital currency, some worry that the country could use it to further extend its financial reach and influence around the world.Despite these concerns, it’s clear that China’s interest in cryptocurrencies is only growing. As the country continues to make strides in the digital currency space, it will be interesting to see how it impacts the global economy and the future of finance.