PDAX gears up for trading surge amidst Binance market exit

Hong Kong's financial watchdog, the Securities and Futures Commission (SFC), has issued a stern warning against two crypto investment schemes, namely the "Floki” and “TokenFi” staking programs. Offering high annual returnsThese programs, luring investors with enticing promises of annual returns ranging from 30% to over 100%, have triggered concerns within the regulatory authority due to their lack of authorization and questionable nature. In an update issued on Friday, the SFC emphasized that both Floki and TokenFi's staking offerings have not been granted approval for public offerings. Furthermore, the administrators of these programs have failed to provide convincing explanations about the feasibility of achieving such unusually high returns. The SFC cautioned that engaging in staking arrangements involving virtual assets without proper authorization may constitute unauthorized collective investment schemes.Photo by Sigmund on UnsplashUnsustainable yieldThe watchdog expressed its worry about the legitimacy of these staking programs, highlighting that neither has received the necessary authorization to provide services to the public in Hong Kong. Investors participating in these programs would not be protected under the SFC's regulations, potentially exposing them to significant financial losses. With the failure of many crypto platforms in 2022, a number of industry commentators began to question the sustainability of some public offerings. One such commentator, Allen Farrington, General Partner at bitcoin-native venture capital firm Axiom, repeatedly asked, “Where does the yield come from?” That appears to be the SFC’s concern in this instance. In its statement, it reaffirmed its commitment to upholding regulatory standards and safeguarding investors from fraudulent schemes. It warned that any breach of the law, including the promotion of unlicensed collective investment schemes, will result in appropriate legal action. Elon Musk-inspired meme coinFloki, initially conceived as a meme-coin inspired by Dogecoin, a project associated with Elon Musk, has evolved into a comprehensive Web3 project spanning decentralized finance, NFTs and the metaverse. TokenFi is a crypto and asset tokenization platform under the Floki umbrella, which aims to capitalize on the booming trillion-dollar tokenization industry. TokenFi, denoted by the ticker TOKEN, seeks to simplify the crypto and asset tokenization process with aspirations of becoming a leading platform globally. Launched last October, TokenFi operates as a multichain tokenization platform on both Ethereum and Binance Smart Chain. While both Floki and TokenFi offer distinct staking programs, they share a close integration. Stakers under the Floki scheme gain access to a significant portion of TokenFi's supply, while TokenFi stakers earn TOKEN rewards through a user-friendly interface. In the broader context of crypto staking, the practice allows users to earn rewards by contributing to a blockchain's security through the proof-of-stake mechanism. By staking cryptocurrency, users participate in a staking pool, similar to depositing money into a savings account. Staking rewards typically range from 5-20%, attracting investors seeking profitable opportunities. However, caution is advised against schemes promising unrealistic returns. The SFC, in collaboration with the Hong Kong Police Force, established a dedicated working group last year to enhance vigilance and enforcement in the evolving crypto sector. 

Binance APAC Head Urges the Korean FIU to Approve Gopax’s Exec ChangesIn a recent interview with Yonhap News, Leon Sing Foong, Binance’s head of Asia-Pacific operations, emphasized the importance of the Korean financial regulator approving the change of executives at Gopax, a Korean crypto exchange.©Pexels/freestocks.orgDelayed staked asset returnFoong’s comments came in the face of mounting worries regarding the delayed repayment of assets stored in Gopax’s staking service GOFi. He explained that 25% of the assets staked in GOFi have been repaid, and the remaining assets will be refunded after approval of the Financial Intelligence Unit (FIU) of the Korean Financial Services Commission (FSC) is secured.Foong was appointed as the new CEO of Gopax last February, with Binance becoming the largest shareholder of Gopax’s operator Streami. In March, Gopax submitted an application to the FIU to inform them of the executive changes, as required by Korean law.However, the application review has been delayed amid concerns about the unclear location of Binance’s headquarters and its regulatory challenges in the US.Controlling staking servicesThe Binance executive believes Gopax’s staking service should be controlled by the exchange itself, rather than a third party. The current GOFi issue emerged due to Gopax’s management of its custody assets through crypto lender Genesis, which ceased trading following the FTX bankruptcy. Foong stated that Binance will require Gopax to maintain reserves of over 100% and eventually phase out the third-party-based service.According to Foong, Gopax’s business model will remain unchanged, and the exchange will work alongside Binance to bolster liquidity within the local market while enhancing both infrastructure and security measures. He considers internal risk management as Gopax’s top priority.Risk assessmentFoong also expressed confidence in the upcoming risk assessment of Gopax by Jeonbuk Bank, recently requested by the Korean Financial Supervisory Service (FSS). He said that the exchange is healthy, and that Binance has high-level anti-money-laundering (AML) capabilities.Korean law mandates crypto exchanges supporting Korean won trading have real-name bank accounts, and Gopax receives such accounts from its partner Jeonbuk Bank.Binance’s Asian expansionBinance’s endeavor to enter the Korean market is part of its strategy to expand its presence in Asia. It was previously reported that Binance Japan will start its operations around June this year.

Asian Firms Feature in Ledger’s Institutional Trading OfferingCrypto hardware storage device provider Ledger has recently introduced the Ledger Enterprise Tradelink network with the participation of a number of well-known Asian crypto platforms.Through its Ledger Enterprise Tradelink offering, Ledger aims to provide a robust and open trading platform specifically designed for institutional investors. The company announced its move into the institutional trading technology market via a blog post published to its website on Wednesday.Photo by Kanchanara on UnsplashMeeting institutional needsThis platform aims to meet the unique risk management and regulatory requirements of institutions seeking to participate in the cryptocurrency market.Given recent events, such as the bankruptcy of the FTX crypto exchange, market participants are increasingly seeking transparency and alternatives to traditional vertically integrated crypto exchanges. There are also concerns regarding the future of market infrastructure in light of the recent lawsuits filed by US regulators against major exchanges like Binance and Coinbase.Sebastien Badault, the VP of Metaverse & NFTs at Ledger, highlighted these concerns and emphasized the importance of addressing them. He explained that the Ledger Enterprise Tradelink network enables a seamless connection between custodians, OTC brokers, and exchanges, allowing traders to execute trades without having to hold funds on the exchange itself.This unique feature serves to minimize the risks associated with centralized exchanges. Badault further predicted that as regulations evolve, fund managers will likely be required to distribute their risk across multiple custodial partners, making the Ledger network an appealing solution.Asian partnershipsTo bring the enterprise-grade platform to life, Ledger has partnered with several prominent crypto exchanges and broker firms. These include international companies like Bitstamp, Uphold, CEX.IO, Wintermute, Coinsquare, NDAX, Damex, Flowdesk, and YouHodler. Additionally, Asian platforms feature strongly, represented by the likes of Seychelles-headquartered crypto exchange Huobi, Singapore-based platform Crypto.com, and Thailand’s Bitazza, a digital asset platform.Other participating companies comprise of Komainu, a digital asset custodian backed by Japanese financial services company Nomura, Tokyo-based institution-facing crypto finance firm, Crypto Garage and Hong Kong’s Kryptodian, a digital asset custodian.Other international partners include digital asset custodians TetraTrust and Etana. The partnership depth that Ledger has put in place with its Ledger Enterprise Tradelink product ensures that firms utilizing the network are not locked into a single custodial provider.Crypto.com President & COO, Eric Anziani, praised Ledger’s innovative Trading Operation technology, emphasizing its role in enhancing security and fostering a regulation-friendly landscape for institutional trading. The collaboration with Ledger enables Crypto.com to participate in the Ledger Enterprise Tradelink network, expanding their offerings for institutional clients and strengthening their position within the market.Ledger Enterprise offers real-time tracking of collateral balances and operational status for all participants, providing enhanced transparency and operational efficiency. Furthermore, the platform boasts zero transaction fees, making it a cost-effective solution for institutional investors, as highlighted in the press release.This initiative by Ledger aligns with the industry’s growing demand for regulatory compliance and effective risk management solutions. Consequently, Ledger’s entrance into this space marks an important milestone in facilitating institutional participation and driving further adoption of cryptocurrencies.