South Korea’s DPK to propose crypto bill with $3.58M stablecoin reserve minimum

The launch of Hong Kong's inaugural spot crypto exchange-traded funds (ETFs) is expected to occur by mid-2024, according to one of Hong Kong’s leading crypto executives. Gary Tiu, the executive director and head of regulatory affairs at OSL, a licensed cryptocurrency exchange based in Hong Kong, made that assertion in discussion with The Hong Kong Economic Journal. Tiu provided the publication with insights into the accelerating pace of negotiations between cryptocurrency exchanges and fund companies in the region.Photo by Stella P on UnsplashUp to ten firms contemplating ETF launchOSL is actively engaged in discussions with multiple fund companies, with five to ten firms contemplating the introduction of spot crypto ETFs. Tiu revealed that certain firms have made notable progress, raising the possibility of the debut of these ETFs in Hong Kong by the middle of the year. Additionally, the OSL executive emphasized the significance of maintaining reasonable fees in collaborations between OSL and fund companies, given the limited presence of licensed crypto exchanges in the city – a total of two at present. This suggestion from Tiu aligns with similar recent soundings emanating from HashKey, another licensed crypto exchange in Hong Kong, which recently disclosed its ongoing discussions with asset managers exploring the potential launch of spot crypto ETFs. Livio Weng, the CEO of HashKey, indicated that approximately ten fund companies are considering the introduction of such ETFs in the city. VSFG’s ETF plansAligned with Tiu’s thoughts on the matter, according to a Bloomberg report last week, Venture Smart Financial Holdings Ltd (VSFG), a Hong Kong-based financial services firm, expressed plans to potentially launch a spot bitcoin ETF within the first quarter of this year. Bloomberg reported the company's goal of growing the ETF's assets under management to $500 million by the end of 2024. The regulatory landscape in Hong Kong is actively adapting to accommodate spot crypto ETFs, with the Securities and Futures Commission (SFC) and the Hong Kong Monetary Authority (HKMA) announcing in December that they have reviewed their existing policies. Two circulars were published, outlining the requirements for spot crypto ETFs, with the SFC stressing that transactions should be conducted through SFC-licensed crypto platforms or authorized financial institutions. Currently, Hong Kong has listed several futures-based crypto ETFs, including the Samsung Bitcoin Futures Active ETF, CSOP Bitcoin Futures ETF and CSOP Ether Futures ETF. Hong Kong venue for Bitcoin conferenceIn a related development, local lawmaker Johnny Ng revealed on social media on Monday that Hong Kong will host The Bitcoin Conference this year. Earlier this month Ng urged the local administration in Hong Kong to swiftly follow the United States' approval of spot bitcoin ETFs and position the city as a leading hub in the cryptocurrency space. With Hong Kong and Singapore vying for hub status in the Asian region relative to the digital assets space, the launch of ETF products would give the Chinese autonomous territory a competitive head start given that Singapore doesn’t appear to be close to accommodating crypto ETFs for the time being.

Japan mulls unrealized crypto gains tax exemptionJapanese lawmakers are currently in discussions about a proposal that could exempt companies from paying taxes on unrealized cryptocurrency gains.Photo by Joshua Tan on UnsplashReforming aggressive crypto tax policyThe plan is anticipated to be incorporated into the fiscal 2024 tax reform agenda, according to a report published by Nikkei Asia on Wednesday.Up until now, Japan has had some of the most aggressive tax rates where cryptocurrencies are concerned when compared internationally. At the moment, corporations have to pay a 30% tax on crypto holdings regardless of whether they’ve sold those digital assets or not. The policy has been criticized broadly by crypto sector participants in Japan. It is seen as inequitable, considering that Japan taxes profits from stocks at a flat 20%.Corporate tax exemptionThe proposal, currently under deliberation by Japan’s ruling coalition, specifically targets Japanese companies holding digital assets for purposes other than short-term trading. If approved, these firms may be granted an exemption from corporate tax, contingent on mark-to-market valuations at the close of the fiscal year.Mark-to-market valuations involve assessing the fair values of assets with periodic fluctuations, such as cryptocurrencies. This exemption is expected to benefit various entities, including venture capital (VC) firms, non-fungible token (NFT) businesses and other blockchain companies holding cryptocurrencies for payment purposes. Additionally, crypto issuers, who are also crypto holders, would not be subjected to these taxes.Policymakers from the Liberal Democratic Party and the ruling coalition partner Komeito engaged in discussions on Tuesday regarding these potential tax exemptions.Bringing clarity to crypto taxationThis move is part of Japan’s ongoing efforts to bring clarity to crypto taxation. In June, the National Tax Agency clarified that crypto issuers in the country would not be liable to pay capital gains taxes on unrealized gains, fostering a more conducive environment for crypto-related businesses.Japan has been actively reviewing its crypto tax policies since last year, aiming to incentivize companies to stay in the country. This initiative follows the departure of several startups due to heavy tax burdens.Industry reactionWith news of this potential Japanese crypto tax reform breaking, crypto community members haven’t wasted any time in providing their thoughts. Taking to the X social media platform, Sota Watanabe, the founder of the Astar Network multichain dApp hub, wrote:”Good move. This is what I requested multiple times to the government over years. Once this issue is solved this year, all companies, especially big enterprises, can hodl crypto like ASTR much easier. Japan weighs ending tax on some corporate crypto holdings.”Former Goldman Sachs Portfolio Manager and Web3 investor, Steve Lee, said that this is “another big move in Japan that would help enterprises push their crypto business.”The Financial Services Agency (FSA), Japan’s top financial regulator, recently submitted legislation-change requests to the government, seeking alterations to the taxation of domestic crypto firms. Critics argue that the existing rule has impeded innovation in the crypto-asset and blockchain sectors, placing an undue burden on companies.On Oct. 16, major businesses in Japan, through the Japan Association of New Economy (JANE), urged the government to implement crypto tax reforms in 2024. Their appeal emphasizes the potential for reduced tax rates to stimulate growth and increase tax revenue.

Singaporean fintech Alchemy Pay, specializing in crypto payments, has inked a partnership with Worldpay, a well-known payment processor based in the United Kingdom.Photo by Markus Winkler on Unsplash More seamless crypto transactionsThe collaboration, announced on Tuesday, enables Alchemy Pay users to leverage Worldpay’s extensive Visa and Mastercard payment rails, facilitating more seamless cryptocurrency transactions via credit and debit cards. In addition, the parties have agreed that at some stage in the future, Worldpay’s payment channels will add support for Alchemy Pay’s NFT Checkout.Robert McCracken, the Ecosystem Lead at Alchemy, expressed the strategic advantage of the partnership, stating:“Alchemy Pay is now better positioned to assist our business partners and users in seamless cryptocurrency transactions worldwide.”This move aligns with Alchemy Pay’s broader mission of promoting global adoption of digital assets by connecting fiat to the Web3 economy.Nabil Manji, Head of Crypto and Web3 at Worldpay, emphasized the alignment of goals between the two entities. He stated: “Alchemy Pay’s mission to promote global adoption of digital assets by connecting fiat to the Web3 economy is aligned with Worldpay’s role in bridging the gap between traditional and digital finance.”Founded in 2018, Alchemy has established itself as a fiat-to-crypto onboard processor, supporting over 50 fiat currencies through platforms like Google Pay, Apple Pay and various mobile wallets. Licensing driveThe announcement follows Alchemy’s recent acquisition of a money service license in the U.S. state of Iowa on Nov. 23, building on its approval for a similar license in Arkansas in September. The firm has indicated that not only does it have other state licensing applications in the works but that it expects to be in a position to announce further approvals over the coming weeks.The Singaporean company has also been paying attention to licensing requirements elsewhere. In February Alchemy, alongside fintech firm PT Berkah Digital, jointly obtained licensing from the Central Bank of Indonesia. Pursuing collaborationsAlchemy Pay has had a steady stream of announcements relating to industry partnerships in 2023. In July it inked a deal with Checkout.com, allowing the firm to integrate Checkout.com’s Visa and Mastercard channels into its on and off-ramps.In recent weeks, the company introduced new payment options, linking in with Single Euro Payments Area (SEPA) Instant in Europe and the Faster Payments platform in the United Kingdom. Alchemy Pay also struck up a deal with self-custody crypto wallet Trust Wallet. It meant that Trust Wallet’s 70 million users could execute crypto transactions directly with fiat payments.Back in May, the payments gateway announced the provision of a rupee-denominated on-ramp via India’s UPI real-time payments system. Worldpay integrationsWorldpay, owned by Fidelity National Information Services (FIS), has been actively integrating with Web3 technologies. In July 2021, the firm partnered with OKCoin to provide infrastructure for the exchange’s fiat-to-crypto onboarding.Additionally, in October 2022, the digital asset custody platform Fireblocks launched a new payment engine for merchants, with Worldpay serving as one of the pilot partners alongside Checkout.com.