Japan’s Blockchain Group Requests Crypto Tax Revision for Web3 Adoption

Hong Kong-based digital asset financial services firm HashKey Group has announced its intention to list its platform token, HSK, in Q3 2024. HSK tokenomicsThe company set out details of the HSK listing via a series of posts on the X social media platform. The HSK token is based on the Ethereum ERC-20 token standard. Total token supply will be capped at one billion, 65% of which will be allocated towards ecosystem growth. The team will be incentivized by the allocation of 30% of the supply while 5% will be held back in a reserve fund.  Regarding the token’s burning mechanism, HashKey revealed it retains the discretion to repurchase up to 20% of net profits from specified businesses and subsequently burn the acquired tokens from the total supply.Photo by Zoltan Tasi on UnsplashAirdrop imminentIn a statement shared with The Block, HashKey Group detailed that HSK will be integrated across its various products and applications. The community airdrop, launching in late June, aims to encourage user participation. The company stated:“HSK is scheduled to launch a community airdrop through HashKey's core businesses in late June, encouraging users to contribute to community building.” The company believes that HSK will incentivize ecosystem contributors when it comes to development of its layer-2 ecosystem chain, the HashKey Chain. That incentive structure, the company maintains, will result in contributors “providing robust support,” while acting as a “driving force for on-chain users and assets.”  Integration with external ecosystemsThe firm outlined that the HSK token is designed to integrate with external crypto ecosystems so as to best facilitate synergy between internal and external collaborations. HashKey Group boasts a comprehensive Web3 ecosystem, inclusive of infrastructure, middleware, AI, DeFi, GameFi and the Metaverse. HashKey Group’s core businesses include HashKey Capital, HashKey Tokenisation and HashKey NFT. It also operates HashKey Exchange, a licensed cryptocurrency exchange in Hong Kong, with the exchange business having reached a $500 million assets-under-management (AUM) milestone earlier this month.  HashKey Cloud, a Web3 infrastructure provider, formed a strategic partnership with the Aptos Foundation last month with a view towards progressing projects relative to decentralized identity (DID) and security token offerings (STOs). HashKey Global, a global exchange launched in April, has risen to ninth spot in terms of overall crypto exchange trading volume. In January, HashKey Group announced that it raised nearly $100 million in its Series A financing round, achieving a pre-money valuation above $1.2 billion. In September, the investment arm of the company, HashKey Capital, launched a $100 million fund focused on altcoins.

3AC Founders Vow to Donate Future EarningsThe co-founders of the Singapore-headquartered bankrupt crypto hedge fund Three Arrows Capital (3AC) have publicly committed to donating their “future earnings” to creditors who suffered losses during the fund’s dramatic collapse.Kyle Davies and Su Zhu made this groundbreaking announcement during a candid Twitter Spaces session hosted by Mario Nafwal, aiming to establish a “shadow recovery process” parallel to the ongoing liquidation proceedings.Photo by Josh Appel on UnsplashBelieving in karmaDavies explained that their intended donations would be separate from the formal recovery process, designed to supplement any reimbursements that creditors might receive through the liquidation proceedings. While acknowledging that some early creditors have already been made whole, he emphasized the founders’ unwavering belief in the concept of “karma.”They see their act of giving back as a way to balance the scales and provide an avenue for creditors to potentially recover their losses.Creditor skepticismHowever, these noble intentions expressed by Davies and Zhu have been met with skepticism from the crypto community and the very creditors they seek to assist. Teneo, the liquidator overseeing the 3AC liquidation, responded to Davies’ comments by expressing disappointment in the founders’ lack of cooperation during the ongoing process. They stressed that the founders should prioritize engaging in the court-ordered activities rather than making promises about future earnings from a new venture.Acknowledging concerns about optics, Davies addressed questions surrounding the launch of their new crypto exchange, Open Exchange (OPNX), while their previous company undergoes liquidation. He stressed the inherent connection between OPNX and the creditors, suggesting that the success of their new entrepreneurial endeavor would ultimately benefit those affected by the collapse of Three Arrows Capital.OPNX success requiredOPNX, the newly launched Dubai-based trading platform, is specifically designed to facilitate the trading of bankruptcy claims. Since its announcement in February, the platform has garnered significant attention, boasting an impressive user base of 20 million individuals holding a collective $20 billion in claims. It is worth noting that the collapse of Three Arrows Capital resulted in the loss of $2.5 billion in customer deposits, making the success of OPNX crucial for creditors seeking redress.Davies also revealed that OPNX currently records approximately $50 million in daily trading volume, showcasing promising early traction for the platform. However, the exact mechanics of the “shadow recovery process” were left unspecified.While OPNX currently only facilitates the trading of claims from lender Celsius, the platform has ambitious plans to include claims from other high-profile bankruptcies in the near future. The list of potential additions encompasses notable entities such as FTX, Genesis, BlockFi, Voyager, Hodlnaut, Mt. Gox, Vauld, Zipmex, and even Three Arrows Capital itself.When taken at face value, the founders’ pledge to donate future earnings to creditors takes on the appearance of a significant and commendable gesture. However, doubts persist within the crypto community due to the founders’ prior actions and the ongoing liquidation process. Only time will reveal the true impact of this “shadow recovery process” and whether it will genuinely alleviate the losses suffered by creditors in the wake of Three Arrows Capital’s collapse.

Crypto.com, the global crypto exchange platform headquartered in Singapore, has recently added an “AED Fiat Wallet,” allowing its users based in the United Arab Emirates (UAE) to deposit and withdraw UAE dirhams to and from their Crypto.com accounts. In a statement published on its website on Dec. 11, the firm outlined details of the added feature. So as to be able to access the AED Fiat Wallet, UAE residents will need to be registered on the platform with a UAE phone number. Once users configure platform settings to reflect the AED as their default currency, the platform displays the relevant deposit information to enable users to deposit the currency to their accounts. The minimum deposit has been set at 10 AED per transaction with a maximum of four million AED per day.Photo by Katerina Kerdi on UnsplashFacilitated by Standard CharteredCrypto.com claimed on X that the new feature could be set up easily, enabling fast and simple transfers. Additionally, the company is not charging users a deposit fee for AED deposits. Tarik Erk, Crypto.com’s General Manager for Middle East & Africa, explained that a collaboration with British multinational bank Standard Chartered had enabled the offering. Erk stated: “This new wallet launch is made possible through our global banking partnership with Standard Chartered which we announced in August, alongside the ongoing and valued support of VARA [Virtual Assets Regulatory Authority], which enables us to continue our expansion across the UAE. We’re extremely focused on offering our customers a seamless world-class experience and, at its very core, that includes ease of deposits and withdrawals – enabling our customers to interact with our products and services with as much flexibility as possible.” Crypto.com launched its service in the UAE in August, and at the time, it recognized the significance of its partnership with Standard Chartered. In September Standard Chartered announced the launch of crypto custody services in the UAE in collaboration with Brevan Howard Digital. The service was licensed by the Dubai Financial Services Authority (DFSA).  In November of last year, Crypto.com was awarded a license by VARA to provide virtual asset services. Last week, it emerged that the company had acquired Orion Principals Limited, an Abu Dhabi-based securities firm. The brokerage firm is licensed by the local regulator within the Abu Dhabi Global Market, an economic free zone and financial center. Crypto.com said that the acquisition will lead to the company rolling out new services to eligible platform users, including securities, options, futures and contracts for difference. Deutsche Bank partnershipHaving forged a partnership with TradFi banking giant Standard Chartered in the Middle East, Crypto.com announced a similar partnership with another TradFi giant, Deutsche Bank, last week. The collaboration will see Deutsche Bank provide the company with banking support and corporate banking services within its home base of Singapore, as well as in Australia and Hong Kong. Back in June, Deutsche Bank partnered with another crypto exchange business, Bitpanda, to assist it in offering real-time inbound and outbound payments on its platform.