Bithumb Eliminates Trading Fees to Attract Investors and Gain Greater Market Share

JPMorgan Adopts Blockchain for 24/7 Interbank Transactions in IndiaAmerican multinational financial services company JPMorgan Chase has partnered with six major Indian banks to introduce a blockchain-based platform that leverages the technology’s benefits to address the restraints of traditional finance.Photo by Naveed Ahmed on UnsplashInterbank settlementThe collaboration aims to enable interbank settlement of US dollar transactions in India’s Gujarat International Finance Tec-City (GIFT City), positioning it as an alternative trading center to Singapore and Dubai. That’s according to a report from Bloomberg, published on Monday. The participating banks in this pioneering initiative include HDFC Bank, ICICI Bank, Axis Bank, Yes Bank, IndusInd Bank, and JPMorgan’s own banking unit at GIFT City.Onyx blockchainThe blockchain project, utilizing JPMorgan’s Onyx platform, aims to expand the capacity of the existing settlement system. Kaustubh Kulkarni, JPMorgan’s senior country officer, stated that the platform will enable the participating banks to process instant transactions 24 hours a day, seven days a week. By leveraging blockchain technology, the interbank settlement process will become faster and more efficient, overcoming the current limitations of time and availability.Onyx blockchain was established in 2020 and serves as JPMorgan’s digital assets network. It was specifically designed with interbank settlement and wholesale payment transactions in mind.Reduced settlement timeUnder the prevailing interbank settlement system, transactions could take several hours to complete, and settlement is not available on weekends or public holidays. JPMorgan’s blockchain pilot, however, will remove these barriers, as Kulkarni explained: “By leveraging blockchain technology to facilitate transactions on a 24x7 basis, processing is instantaneous and enables GIFT City banks to support their own time-zone and operating hours.”This initiative not only addresses the operational challenges of interbank settlement but also serves New Delhi’s strategic goal of positioning GIFT City as a prominent alternative trading center. With the implementation of blockchain technology, GIFT City can provide a competitive advantage by offering efficient, real-time transaction capabilities.The success of Onyx is evident, as the bank reportedly processed nearly $700 billion in short-term loan transactions through the platform as of April 2023. The utilization of Onyx for the interbank dollar transfers in India further demonstrates JPMorgan’s commitment to exploring the potential of blockchain technology in the financial sector.Positioning for de-dollarizationAdditionally, JPMorgan’s involvement in this initiative aligns with the evolving landscape of global finance. The bank’s currency strategists have highlighted signs of emerging de-dollarization, with the US dollar’s share declining in foreign exchange reserves and exports. The adoption of blockchain technology for dollar transactions not only improves efficiency but also aligns with the changing dynamics of the global financial system.As JPMorgan launches the pilot project in collaboration with the Indian banks, the coming months will be crucial for analyzing the experiences and outcomes. This initiative marks a significant step towards streamlining financial operations, embracing innovative solutions, and strengthening India’s role in the adoption of blockchain technology within its financial infrastructure.

Chinese Fentanyl Producers Taking Payment in CryptoA report produced by blockchain analytics and crypto compliance solutions firm Elliptic has found that most Chinese suppliers of fentanyl precursors are accepting payments for the illicit material in cryptocurrency.In a blog post published on its website on Tuesday, Elliptic claimed that 90 percent of the 90 China-based firms, from which its researchers received offers of fentanyl precursors, accepted cryptocurrency as a form of payment. The majority of fentanyl which is trafficked into the United States is manufactured using imported fentanyl precursors like the material that the Elliptic researchers were offered.Seventeen of the suppliers even offered to provide fentanyl itself. Others still offered to supply synthetic opioids, equally or more potent than fentanyl, which are currently legal to both produce and supply within China.Photo by Hal Gatewood on UnsplashTracking blockchain transactionsIn tracing back transactions relative to these illicit suppliers, the Elliptic researchers’ analysis demonstrated that the digital asset wallets used by the rogue suppliers have received thousands of payments. The research team has estimated the net worth of those transactions to total $27 million.It appears that a move towards crypto payments is trending with this group of suppliers as there has been a 450% increase year-on-year when it comes to payments for fentanyl precursor using crypto.The study highlighted activity related to Dutch national Alex Peijnenburg. An alleged fentanyl supplier, Peijnenburg, made an $85,000 payment in crypto to one of the ninety fentanyl precursor suppliers identified by Elliptic researchers. In November of last year, the Dutchman was sanctioned by US authorities relative to his activities.Global trade and distributionThe report stated: “During our correspondence, the suppliers showed no concerns about how the chemical would be used, with some explaining that it was their best-selling product and could be used to produce fentanyl.”It went on to state that “others pointedly mentioned that they had sold it to customers in Mexico.” Mexico is a significant location in the global drugs trade, given the activity of drug cartels within the country. One supplier offered an insight to researchers as to the preferences of their nefarious Mexican clients, stating: “They always use USDT or Bitcoin to pay. It is no problem.”While it looks like these nefarious Chinese companies are able to trade into and out of crypto assets, that should be a difficulty for them as China banned the offering of crypto trading services going back a number of years already. Furthermore, foreign digital asset exchanges are prohibited from servicing the needs of Chinese clients where crypto is concerned.Elliptic’s research team uncovered that the majority of the illicit drugs trade suppliers have been using workarounds in order to gain access to overseas digital asset exchanges. The suppliers have used intermediaries in order to convert crypto into Chinese yuan.The report concludes that this part of the international fentanyl trade can be dealt with and “disrupted by the services that act as gateways into and out of crypto assets.” On arriving at that conclusion, Elliptic has acted by notifying the digital asset exchanges that these suppliers are using. “[We] have flagged hundreds of crypto addresses in our tools as being linked to this activity,” the report states.Crypto had infamously been associated with illicit activity on the dark web in its earliest years. It has moved well beyond that although due to its decentralized nature, it’s difficult, if not impossible, to control who utilizes decentralized digital currency.

Dunamu Loses Lawsuit Seeking $19M in Corporate Tax Refunds After Venture Status RemovalDunamu, the operator of South Korea’s largest cryptocurrency exchange Upbit, lost a 24.8-billion-won (approximately $18.7 million) corporate tax lawsuit, according to local news outlet The Korea Economic Daily. This legal action emerged after Dunamu was removed from the list of registered venture firms in December 2018. The Seoul Administrative Court ruled that since Dunamu was no longer a venture, it was not eligible for the associated tax benefits.Photo by Tingey Injury Law Firm on UnsplashLosing venture statusIn September 2017, Dunamu obtained certification as a venture company from the Ministry of SMEs and Startups. However, this certification was revoked in December of the following year. This revocation was due to an amendment to the Enforcement Decree of the Venture Businesses Act in October 2018, which resulted in the exclusion of “blockchain-based crypto asset trading and brokerage” from the venture business classification. Consequently, the withdrawal of this certification rendered the company ineligible for government tax incentives.Tax refund request deniedIn August 2020, Dunamu took action by formally requesting a refund of KRW 24.8 billion in taxes previously paid to the tax office. The foundation of its claim rested on its entitlement to venture company tax benefits up until the corporate tax period of 2018. However, its request was turned down, leading Dunamu to escalate the matter by initiating an administrative case against the tax authorities, following an unfavorable decision by the Korean Tax Tribunal.Meanwhile, an amended version of the Act on Special Cases Concerning Taxation Restrictions, which excluded cryptocurrency-related industries from benefiting from tax reductions, went into effect in January 2019. Pointing to the effective date of this act, Dunamu argued that the company should be entitled to benefits applicable up until the corporate tax cycle of 2018. Furthermore, Dunamu highlighted its legal action, which had led the administrative court to suspend the effects of the venture company certification revocation from December 31, 2018, to January 18, 2019.Court’s stanceDespite these arguments, the court rejected Dunamu’s argument and upheld that tax relief could not be granted for the tax year encompassing the date of the removal of its venture status. Additionally, the court affirmed that the tax authorities’ decision was valid since the venture status had been revoked in 2018, regardless of the amended Taxation Act’s implementation.In disagreement with the court’s ruling, Dunamu has filed an appeal against the decision.