Liminal expands into Middle East via Abu Dhabi approval

China's highest judicial authorities, the Supreme People's Court and the Supreme People's Procuratorate, have released a judicial interpretation that includes the use of virtual assets to transfer illicit funds as a recognized method of money laundering. This move aims to strengthen the legal basis for investigating and prosecuting cases linked to cryptocurrency and money laundering activities.Photo by Vidar Nordli-Mathisen on UnsplashClarifying the legal status of crypto transactionsThe new judicial interpretation classifies virtual asset trading as a potential channel for money laundering. It specifies that using virtual-asset transactions or financial-asset exchanges to transfer or convert the proceeds of crime falls under the act of “disguising or concealing the source and nature of criminal proceeds and their gains by other means” as outlined in the country’s criminal law. Liu Honglin, founder of the Shanghai-based Man Kun law firm, clarified in a social media post that the interpretation does not equate all cryptocurrency trading with money laundering. According to Liu, the directive is not intended to criminalize the possession or trading of cryptocurrencies domestically but to provide clear legal guidelines for prosecuting specific illegal activities linked to crypto transactions. Impact on crypto trading and enforcementShao Shiwei, a fintech lawyer based in Shanghai, suggested that this interpretation could pose challenges for stablecoin merchants and increase legal risks for those involved in receiving illicit funds through crypto trading. The interpretation is part of broader efforts to regulate the virtual asset space, following the comprehensive ban on crypto trading activities by the People’s Bank of China and other authorities in September 2021. Despite the ban, many investors have continued to find ways to engage in crypto trading, sometimes circumventing capital control measures. For example, in May, Chinese police dismantled an underground bank that utilized the USDT stablecoin for foreign currency exchanges involving over 13.8 billion yuan ($1.9 billion). This incident underscores the ongoing challenges in enforcing existing regulations against the backdrop of innovative methods to bypass legal restrictions. 

The Securities and Exchange Board of India (SEBI) is set to introduce a same-day settlement cycle starting March 28, making India only the second country, following China, to adopt such a system. This move comes amidst growing competition from the cryptocurrency sector, with SEBI Chairperson Madhabi Puri Buch emphasizing the need for instant settlement and tokenization to remain competitive.Photo by Big G Media on UnsplashEvolving market dynamicsBuch has unveiled plans aimed at enhancing the efficiency of India's capital markets through faster settlement processes. During a recent press conference, she highlighted the significance of adapting to evolving market dynamics. Buch stated:“If our well-regulated market cannot compete with the crypto world and cannot say we also offer you tokenization and instantaneous settlement over the medium term, I won’t even say long term, you should expect investors to move." The SEBI chairperson articulated that we live in a time where the current generation demands instant delivery of services. It’s with that in mind Buch believes that crypto is a threat to traditional financial markets. She stated:"Everybody wants instant everything. Right? So why should anyone believe that tomorrow if an alternative is available with instant settlement tokenization and they say the regulated market doesn’t offer it, you should expect people to move.” With a focus on meeting investor expectations for instant transactions, SEBI aims to bridge the gap between traditional capital markets and the rapidly evolving crypto landscape. Faster settlement cyclesIndia has been at the forefront of adopting faster settlement cycles, having transitioned to a one-day settlement (T+1) model between 2021 and January 2023. The optional same-day settlement, scheduled to commence later this month, represents another step towards enhancing market efficiency. However, Buch cautioned that further delays in embracing instant settlement could lead to a significant portion of the market shifting towards cryptocurrencies. The move towards faster settlement has been met with enthusiasm from some market participants. Indian business news publication Mint reported the comments of Shauryam Gupta, CEO of web trading platform Rupeezy, on the subject. Gupta stated: “The shift to instantaneous settlement is a substantial milestone, streamlining operations and cutting down on risk. The potential advantages of reducing counterparty risk and boosting liquidity signal positive growth for the sector.” However, others, particularly brokers, have expressed reservations. Brokers, who hold client funds and earn interest on balances, stand to see their interest earnings decrease with shorter settlement times. Nonetheless, SEBI remains steadfast in its commitment to modernizing India's capital markets to remain globally competitive. The regulatory landscape surrounding cryptocurrencies in India has been predominantly shaped by the nation's finance ministry and the Reserve Bank of India (RBI). While the RBI has been vocal in its opposition to cryptocurrencies, advocating for central bank digital currencies instead, SEBI's recent initiatives underscore its willingness to adapt to changing market dynamics. SEBI's efforts reflect a broader trend of regulatory bodies worldwide seeking to strike a balance between innovation and investor protection in an increasingly digital financial landscape. 

Korbit CEO partakes in anti-drug relay campaignSouth Korean cryptocurrency exchange Korbit’s CEO, Oh Se-jin, has joined the No Exit anti-drug campaign — a nationwide relay campaign launched in April by the National Police Agency, the Korean Association Against Drug Abuse and other relevant institutions to raise public awareness about the dangers of drug addiction and promote a collective effort to prevent drug-related crimes, according to local news outlet ET News on Wednesday (local time). So far, numerous figures across various sectors and industries have participated, including actor Choi Bool-am and the president of the Korean Nursing Association Kim Young-kyung.Photo by Hal Gatewood on UnsplashEncouraging collective vigilanceThe campaign’s slogan draws a metaphor between drugs and a maze that cannot be escaped once it has been entered. Participants in the campaign are obligated to share photos with a message that reads, “Do not start drugs — it is a maze with no exit”, and nominate the next participants.“I hope that all citizens will realize the seriousness of drugs through the No Exit campaign, and I aspire to contribute to creating a safer society. Korbit will fulfill its social responsibility in the cryptocurrency industry and contribute to building a healthier society,” Oh said.Next participantsOh was tagged in the campaign by Lee Hyo-jin, CEO of the peer-to-peer (P2P) financial services company 8Percent. In turn, he nominated Lee Sang-ho, CEO of HSBC’s Korea office, and Kim Ji-yun, CEO and Co-founder of DSRV Labs, as the next participants.