For better or worse, the Crypto World is connected | #27
Blockchain & Crypto Asia #27
Hello, this is Coco. Welcome back to Blockchain & Crpto Asia. I took a break between April and now. Within these 3 months, the crypto world has drastically changed. My previous newsletter dated April 11 talked about Terra. “Terra, South Korea’s public blockchain, has bought $1.4B bitcoin to fund the reserve of its stablecoin UST, which has a market value of $16B. The purchase of bitcoin is through Terra’s Singapore-based Luna Foundation Guard.” Who could have imagined the implosion of the project and its impact on the crypto industry? More than ever before we have to acknowledge that the crypto industry is intertwined globally and the only way to regulate it is through global coordination and cooperation.
Singapore
In June, MAS awarded 3 more in-principle digital token payment licenses to crypto.com, Genesis under DCG, and Sparrow Exchange, taking the total licenses to 14. Gemini appointed a local citizen as part of its effort to pursue a license from MAS.
With the recent turmoil in the crypto market, MAS is considering “placing limits on retail participation, and rules on the use of leverage when transacting in cryptocurrencies. Given the borderless nature of cryptocurrency markets, however, there is a need for regulatory coordination and cooperation globally.” Limiting the use of leverage by both retail and institutions with global coordination makes a lot of sense.
One of the challenges facing Singapore’s regulator is how to timely alert the market to a player like Three Arrows Capital, which MAS has been investigating since June 2021 for its contraventions including false information and breaching the AUM limit of $250M between 2020 and 2021.
Singapore-registered crypto lending company Vauld halted withdrawals by customers on July 4 after an outflow of $200M. Most of the team of Vauld is based in India. More update about Vauld.
Interestingly, according to local media the Siasat Daily back in Oct. 2021, “founded in 2018, the Singapore-registered startup (Vauld) has so far raised $27 million and aims to reach one million users. It currently has over 150,000 users… most of its customers are from the US, followed by Europe, Singapore and India.”
Greater China
Hong Kong-based crypto exchange CoinFLEX is laying out a plan to recoup its $84M loss from a client.
Hong Kong-based crypto lender Babel Finance froze withdrawals of depositors in June and is going to hire the investment bank Houlihan Lokey which specializes in restructuring and distressed mergers & acquisitions.
Interactive Brokers launched crypto trading in Hong Kong through a partnership with licensed exchange OLG. The other institution that was awarded approval-in-principle in April 2022 to operate a virtual asset trading platform is HashKey Group.
Though China has officially banned crypto, it has an ambitious plan for the metaverse. Shanghai aims to cultivate the metaverse into a $52B industry by 2025. Guangdong Province in the South has drafted policies on developing the digital economy, in particular VR and blockchain.
South Korea
Delio, a South Korean virtual asset provider, launched the country’s first crypto bank. It offers deposits, withdrawals, loans and asset transactions. Additionally, its services include savings, lending, asset management, payment and NFTs.
One of South Korea’s largest mobile telecom companies SK Telecom is building a Web3 wallet that allows users to receive, transfer, and store cryptocurrencies, NFTs, and Soulbound tokens (SBTs). It believes that one of the major bottlenecks facing the blockchain ecosystem is the lack of user-friendly digital wallets.
India
India, one of the most active crypto markets in the world, sees its crypto trading volume slide free fall due to the government’s enforcement of crypto tax, including 30% income tax, 1% TDS tax levied on each transaction and no deduction for losses.
The one-year trading volume on WazirX, the largest crypto exchange in India:
CrossTower partners with Ripple to use XRP Ledger blockchain for minting and trading of NFTs in India.
Investments and Funds
Sequoia India and Southeast Asia raised two new funds totaling $2.85B to invest in India and Southeast Asian countries, respectively. Crypto and Web3 are new sectors Sequoia is looking to expand into, though the fund does not carve out capital for them separately. Recently, Sequoia India co-led an investment of $6M in MoHash, a DeFi protocol. This past February Sequoia India led a $450M investment in Polygon.
Sequoia China raised $9B and will allocate it to 4 funds. Though it does not have a dedicated crypto fund, Sequoia China has been investing in this innovation since 2014. Its investments include Huobi, BitMain, Conflux, as well as the troubled crypto lender Babel Finance.
Animoca Brands completed a $75M raise at a $5.9B valuation. It led a Series A $32M investment in the South Korean company Planetarium Labs, which is building a Web3 gaming network and tools.
Oasys, based in Japan and Singapore, a blockchain for the gaming community, raised $20M through a token sale led by Republic Capital, with participation from Jump Crypto, Crypto.com, Huobi, and Kucoin.
Animoca Brands again, together with gumi Cryptos, co-led the $2M seed investment in Cyan, a startup that offers a Buy Now Pay Later service for the metaverse.
Thank you for reading. Enjoy the summer.
Coco
In the innovative blockchain/crypto & digital asset ecosystem, Asia is the other side of the coin. Blockchain & Crypto Asia, which covers exclusively blockchain and crypto & digital asset developments in Asia, including regulation, investments, and company highlights, helps you stay on top of what is going on in the Far East. The content is selective and curated.
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