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Bitstamp, regarded as the longest-running cryptocurrency exchange in the business, declared on March 6 that it has obtained in-principle approval for a license to function as a Major Payment Institution (MPI) from the Monetary Authority of Singapore (MAS).Photo by Zhu Hongzhi on UnsplashFirst major Euro exchange in SingaporeThis preliminary approval, a precursor to a full-fledged license for operation in Singapore, marks a significant milestone for Bitstamp towards offering digital payment token services within the city-state. According to the exchange's press release, it's the first crypto trading platform with a substantial presence in the European Union (EU) to secure such approval from MAS. The nod from Singapore’s financial regulator arrives amidst notable regulatory strides in the crypto domain, including the European Union’s rollout of the Markets in Crypto-Assets (MiCA) framework and the green light given by the U.S. for Bitcoin ETFs. Focusing on AsiaBitstamp's strategic focus on the Asia Pacific region, with Singapore as its central hub, underscores its focus in delivering services to both institutional and retail clientele across the region. The firm’s intent in this regard became clear in August of last year when Bitstamp sought capital funding to enable it to extend the platform’s reach into various markets across Asia. Whilst the company’s origins can  be traced back to Slovenia, it has since developed further ties with Asia. In 2018, the company was acquired by NXMH, a subsidiary of South Korea’s NXC Corporation. The same holding company owns Korean crypto exchange Korbit. Compliance strategyWhile the licensing is quite the achievement, the company already boasts a robust regulatory track record, surpassing the 50-license mark across key markets such as Luxembourg, the Netherlands, Italy, Spain, France the United States (with coverage in 40 states including New York, Washington, Texas and Florida) and the United Kingdom. In its press release the company referred to its ever-growing licensing collection, outlining that “compliance and regulation [are] at the heart of all operations.” Leonard Hoh, Bitstamp's APAC General Manager, lauded Singapore's proactive stance in establishing a regulatory framework for crypto exchanges, positioning the city-state as a pivotal player in the digital assets landscape. Singapore has already granted full licenses to several crypto service providers, including Blockchain.com, Circle, Coinbase and Ripple. In late 2023, Bitstamp initiated talks with three major European banks regarding the potential introduction of cryptocurrency services in 2024. This signals a broader trend within the EU, where the crypto regulatory initiative, MiCA, is smoothing the path for traditional financial institutions to venture into the digital assets realm. Robert Zagotta, Bitstamp’s Chief Commercial Officer, highlighted the surge in interest surrounding its “Bitstamp-as-a-Service” offering, especially within European circles. This service furnishes a white-label licensing framework, coupled with requisite technology, to aid banks and fintech entities in facilitating cryptocurrency transactions for their clientele. However, the regulatory landscape isn't as welcoming in India, where the country’s Financial Intelligence Unit (FIU) urged the Ministry of Electronics and Information Technology to block the URLs of nine major global crypto exchanges, including Bitstamp, in late 2023. 

HashKey’s New $100M Fund to Prioritize AltcoinsHashKey Capital, the investment arm of Hong Kong-based crypto firm HashKey Group, is embarking on a new investment journey with the launch of a fund that predominantly targets major altcoins.Photo by Kanchanara on Unsplash50% altcoin allocationIn a recent interview with Reuters, Jupiter Zheng, the Portfolio Manager of the fund, revealed that less than 50% of the fund’s allocation will be directed towards Bitcoin (BTC) and Ethereum (ETH), the two largest cryptocurrencies.The fund has already garnered attention from potential clients, primarily high-net-worth individuals and investment firms catering to affluent, high-net-worth Asian families. Zheng underscored the fund’s commitment to diversifying investment strategies, which he believes is necessary as a consequence of the Hong Kong stock market’s recent weakness.“We see untapped demand from professional investors who wish to chase above-market returns in crypto,” Zheng noted, suggesting that the allure of crypto assets is becoming increasingly appealing to traditional investors.$1 billion assets under managementHashKey Capital has $1 billion in assets under management, and the firm has set an ambitious target of raising $100 million for the newly launched fund within the next 12 months. This allocation strategy also includes a portion of the fund’s holdings in cash, allowing for flexibility in navigating the dynamic and volatile cryptocurrency market.In addition to forging ahead with crypto investments, the company is actively establishing distribution channels with offshore Chinese financial institutions, expanding its reach and influence in the digital asset space.Positive market outlookZheng remains optimistic about the crypto market’s future, expressing confidence that cryptocurrency prices are finding stability as industry liquidity improves. He cited several factors contributing to this stabilization, including the plateauing of US interest rates and the growing interest of large US asset managers in filing for spot Bitcoin ETFs, indicating a maturing and evolving industry sector.Responding to news of the new fund, Ryan Selkis, CEO and Founder of crypto market intelligence firm Messari, said that he expected other funds to follow suit in 2024 given that “there’s a ton of inefficiency and mispricing in assets 50–500 by market cap.”HashKey’s progression in the crypto investment space can be traced back to its acquisition of a Type 9 asset management license from Hong Kong’s Securities and Futures Commission last year. This license granted HashKey the ability to manage portfolios exclusively composed of virtual assets, laying the groundwork for its latest venture. It has since secured Type 1 and Type 7 licenses and recently started offering its products to retail investors in Hong Kong, being one of the first to do so.Funding roundEarlier in the year, the company successfully closed a $500 million investment round for a fund dedicated to infrastructure, tooling, and applications that drive the widespread adoption of blockchain and crypto technologies. In April, it launched a wealth management service in response to demand from investors who were looking to gain exposure to digital assets.Hong Kong’s welcoming stance towards cryptocurrencies and its proactive approach to addressing market demand for alternative assets have played a pivotal role in attracting digital asset firms. The city’s Securities and Futures Commission (SFC) has been granting licenses to crypto exchanges in alignment with its new licensing framework, opening up opportunities for retail investors to trade “large-cap tokens” on licensed platforms while implementing safeguards like knowledge tests, risk profiles, and reasonable exposure limits.

Crypto Influencer Arrested in Hong Kong Over JPEX AssociationHong Kong police have taken prominent social media influencer and former lawyer Joseph Lam into custody. Known as “Jolamchok” on Instagram, Lam has been arrested due to his connection with the troubled cryptocurrency exchange, JPEX.According to a report from the South China Morning Post (SCMP) on Monday, law enforcement officials conducted a search of his office, where they seized various items of potential evidence, including a plastic bag containing banknotes.Photo by niu niu on UnsplashCelebrity promotionThe Hong Kong regulator, the Securities and Futures Commission (SFC), recently issued a warning squarely pointing fingers at JPEX for actively enlisting online celebrities like Joseph Lam and over-the-counter (OTC) money changers to promote the platform’s services and products to the Hong Kong public. Hong Kong police are understood to have searched the offices of local OTC exchange service Coingaroo. That action is suspected to be related to the issues that have befallen JPEX.An unverified report suggests that Lam, who is also known as Lin Zuo, may have presented questionable investment “schemes” to a cryptocurrency investment chat group. One of the reported victims was allegedly persuaded to invest 100,000 Hong Kong dollars (approximately $12,800) in cryptocurrencies.In one instance, Lam made claims within the group, stating that people were relentlessly pursuing him for payments and that the amount of money involved was five times higher than usual.“Whatever doesn’t kill you makes you stronger”On September 17, the day before his arrest, Lam shared a news article on his Instagram account, suggesting that he had not been negatively affected by the JPEX investigations. The caption read, “Whatever doesn’t kill you makes you stronger.”Following this development, Lam visited the police alongside his legal representatives to provide the necessary information regarding his involvement with JPEX. In a related development, another crypto influencer, Chen Yi, is understood to have been arrested. Yi is suspected of conspiracy to commit fraud.Liquidity crisisJPEX has publicly attributed its liquidity crisis to regulatory pressures and “third-party market makers.” In response, the exchange increased withdrawal fees and suspended certain operations. They have, however, promised to restore liquidity from third-party market makers promptly and gradually return withdrawal fees to normal levels, with details to follow after negotiations.JPEX maintains that it was being treated unfairly. The exchange also said that it would freeze new trades while existing trades would continue to be active until completion.This arrest and the ongoing issues surrounding JPEX come amid wider concerns in the cryptocurrency sector. A recent report from Bitfinex indicated that capital outflows from the crypto markets amounted to a staggering $55 billion in August alone. This substantial outflow has not only impacted Bitcoin but has also affected the liquidity of Ether and stablecoins, underlining the broader challenges faced by the crypto sector.As the investigation into Joseph Lam’s involvement with JPEX continues, it remains to be seen how this development will impact the ongoing troubles facing the cryptocurrency exchange and the broader crypto ecosystem in Hong Kong and beyond.