India’s judiciary turns down plea to formulate a crypto regulatory framework

Crypto Oasis Founder Thinks UAE Set Up For Crypto SuccessAs the dust settles on 2023's Dubai Fintech Summit, which took place last week, one takeaway offered by the Co-Founder of blockchain ecosystem firm Crypto Oasis is that the United Arab Emirates (UAE) has set itself up for success where crypto business is concerned.In speaking with crypto publication CoinTelegraph on the fringes of the Dubai Fintech Summit, Crypto Oasis Co-Founder and Managing Partner Saqr Ereiqat suggested that the regulatory infrastructure that the UAE has put in place provides an ideal foundation upon which crypto companies can develop and prosper.Photo by Mo Ismail on PexelsRegulatory infrastructureEreiqat pointed to some key fundamentals that crypto entrepreneurs and start-up founders should look at when deciding on the location that will best meet their needs and help to optimize their route to market and ultimate success. This includes the regulatory infrastructure.The UAE authorities and regulators at a national level, together with their colleagues within the regulatory agencies in the Emirates of Dubai and Abu Dhabi, have been doing some heavy lifting in this regard over recent months.They’ve all been working on establishing a workable regulatory framework, and as part of that, a licensing process. In the case of Dubai, its Virtual Assets Regulatory Authority (VARA) has started to issue preliminary or Minimum Viable Product (MVP) license approvals that enable crypto startups to get started, while providing them with a pathway towards obtaining Full Market Product (FMP) licensing at a later stage.Talent poolThe other key requirements that Ereiqat set out were digital infrastructure alongside an ability to attract and provide a pool of talent relative to the crypto assets space. In respect of these key considerations, Ereiqat believes that the UAE hits the target in each case.“The UAE’s regulatory framework is more streamlined and business-friendly compared to the complex and fragmented regulatory environment in the US,” he told the crypto media firm.To enhance these fundamentals, Ereiqat also alluded to a depth of capital that could potentially find its way into UAE-based crypto businesses, easing these start-ups’ efforts in executing on funding rounds as they look to achieve growth.Ereiqat maintains that the interest in the region is already evident, citing a data-point that suggests there are 1,800 Web3-centric businesses already operating in the region, with more than 8,000 people working for those start-up businesses. Speaking to that reality further, he said:“The Dubai FinTech Summit was a significant event that brought together stakeholders from the fintech industry […] The presence of crypto and Web3 leaders and projects at the event is an important indicator of the growing interest and adoption of these technologies in the region.”This enthusiasm and belief in the existence of the right Web3 business environment in the UAE was echoed at that event by both Coinbase Founder and CEO Brian Armstrong and Ripple Founder and CEO Brad Garlinghouse. Both industry figures featured as keynote speakers at the event. Armstrong alluded to the potential of Coinbase establishing a base in Abu Dhabi while Garlinghouse announced the opening of a Ripple office in Dubai.

Japan's Financial Services Agency (FSA) is proposing new legislation in an effort to prevent the assets of Japanese investors held on crypto exchanges from being transferred overseas. According to local news outlet Jiji Press, the Japanese regulator recently put forward the idea of drafting such a bill. It’s thought that the move suggests that the Japanese regulators have learned from the collapses of cryptocurrency exchanges Mt. Gox and FTX. Photo by Jaison Lin on UnsplashLearning from past failuresWhile Japan already had a higher standard of regulation in place prior to the FTX collapse, likely as a consequence of the authorities having experienced the downfall of Mt. Gox in February 2014, there is still room for improvement.  While funds had been ring-fenced for FTX Japan users, those who accessed services advertised in Japan through the FTX app were deemed to have been accessing a service which fell under an international jurisdiction, denying them the same protections otherwise offered to FTX Japan platform users as a consequence of the regulations that had been put in place. Incorporating a holding orderJapanese media outlet Nikkei described this latest move by the Japanese FSA as follows: “The Financial Services Agency is moving towards creating a new ‘holding order’ in the Payment Services Act, which regulates cryptocurrency exchanges, that will order them not to take domestic assets entrusted to them by customers overseas.” Consequently, the regulator is looking to add this as the latest proposed amendment to the Payment Services Act. Back in September it emerged that amendments to that existing legislation were being looked at with a view towards making it easier for businesses to incorporate digital assets into their service offerings. The regulator has also been mulling over the reclassification of crypto as a financial instrument by amending the Payment Services Act accordingly. Additionally, a more generous tax policy is being proposed. Currently, the Japanese authorities impose a tax rate of up to 55% on cryptocurrency-related revenues. Corporate holders of digital assets have to apply a 30% tax rate, irrespective of income or profits. With that, a 20% tax rate is being considered. The matter became a political issue prior to the East Asian nation’s recent elections, with the leader of the Democratic Party for the People (DPP) backing the application of a 20% crypto tax rate. The application of a holding order has applied previously to companies that have been registered under the Financial Instruments and Exchange Act. This proposed amendment would see it applied to virtual asset trading platforms as part of the Payment Services Act. Guarding against bankruptcy lossesIf applied, the amendment would prevent loss of Japanese investor funds in circumstances where a crypto exchange platform goes into bankruptcy. Legal precedent set in the FTX bankruptcy in the United States means that if a user’s funds go into a non-individually segregated hot wallet belonging to an exchange, any property rights, even if explicitly outlined in the terms of service, are lost.  A company can make a case to go into bankruptcy in any international jurisdiction, which means that this precedent has potential implications for all market participants. The proposed amendment from the Japanese FSA would serve to protect investors from such an eventuality.

Aptos charts success in South Korea through bridging Web2 and Web3Aptos, a major layer 1 blockchain network developed by the experts behind Meta’s canceled stablecoin payment system Diem, is growing in South Korea. In a recent Aptos Day conference held at the Hashed Lounge in Seoul, the Aptos team shared its vision for developing its ecosystem in Korea and attracting users by actively bringing content from Web2 to Web3, instead of simply focusing on cultivating a Web3-only ecosystem.Photo by GuerrillaBuzz on UnsplashDavid Wolinsky, a software engineer at Aptos and a former developer at Facebook, presented Aptos’ key advantages and achievements since its launch last year and outlined the blockchain’s future plans for growth.High-speed Web3 powerhouseIn particular, he highlighted Aptos’ high compatibility with social media, its solid security framework built with the Move programming language and a rapid processing speed of up to 200,000 transactions per second (TPS) — with a time to finality (TTF) of less than one second. Thanks to this impressive speed, Wolinsky explained, lots of projects have onboarded the network, which is anticipated to grow into a bigger ecosystem with more decentralized applications (dApps).Aptos has also carried out over 300 million transactions since its launch in October of last year, creating seven million unique addresses. Just two months following its launch, there were already over 200 projects on the blockchain. Aptos could thus play a significant role in revolutionizing Web3, which is currently dominated by the Ethereum virtual machine (EVM).Facilitating the transition from Web2 to Web3To grow the ecosystem further, Wolinsky emphasized the importance of bringing Web2 users to Web3 in an efficient and seamless manner. Aptos aims to achieve this by facilitating the creation of Aptos-based wallets through integration with platforms like Facebook, X (formerly Twitter) and Google, allowing users to enjoy various dApps.Wolinsky also noted that Aptos uses Move — an open-source programming language developed by Facebook for writing smart contracts on the Diem blockchain — which is designed to be developer-friendly, employing similar mechanisms that developers generally use to build applications on Web2. This language can attract not only Web2 users but also Web2 developers who are transitioning to Web3 without worrying about the complexity of the process. Aptos argues that Move is more secure than EVM’s Solidity language.Positive prospects in KoreaAptos also regards Korea as a key market for growth, as Korean developers are actively contributing to the Aptos ecosystem and providing helpful feedback. The blockchain disclosed that as of Q3 this year, Korea has 13 Aptos validators — second only after the U.S., which has 14.Christie Lee, Head of Business Development and Partnerships in Korea at Aptos, argued that Korea is innovating the most at the larger corporate level while also contributing to the ecosystem. Lots of endeavors are playing out in the Korean market, she said, as regulatory restrictions in fields like gaming, entertainment, finance and more are starting to loosen.She also added that the Korean market is not only driven by innovation from large companies but also by small developers who can contribute to the ecosystem, noting that the market is a favorable environment for developers to thrive. In addition, Korean users are sensitive to trends and adept at incorporating technology, which would allow them to quickly adopt Web3 culture.