HashKey now a unicorn, Tether hits back at UN, no Singapore Bitcoin ETF – Cointelegraph Magazine

Hong Kong regulated exchanges reach major milestones

Hashkey Group, the owner of HashKey Exchange, one of the first regulated crypto exchanges to debut in Hong Kong, has raised $100 million at a valuation of $1.2 billion in a Series A funding round. In the January 16 announcement, the firm stated that the capital would be used for product diversification, compliance efforts, and innovation. HashKey reports that within the first four months of its exchange launch, 155,000 users had registered and the daily average trading volume in the past 30 days hit US$630 million. 

Core businesses include HashKey Capital, an asset manager investing exclusively in blockchain technology and digital assets, HashKey Cloud, a blockchain node validation service provider, HashKey Tokenisation, and HashKey NFT, Web3 PFP incubation and community operation service provider.

The firm has also established strategic partnerships with 10 brokerage firms and six publicly listed companies since it was licensed. In August 2023, HashKey and OSL became the first crypto exchanges to receive Securities & Futures Commission (SFC) approval to provide crypto trading services to retail investors.

OSL received a $91 million strategic investment from blockchain services firm BGX in November 2023 and currently has a market valuation of $490 million. 

The deal closed earlier this month with Patrick Pan leading as the firm’s new CEO. In a post on January 12, OSL stated that it plans to expand its business offerings beyond Hong Kong and Singapore. Around the same time, the firm rebranded from the previous BC Technology Group to OSL as to focus on its exchange efforts.

United Nations reprimands Tether 

The United Nations (UN) has published a highly critical report on the use of Tether (USDT) stablecoin by various crime syndicates in East Asia and Southeast Asia. Researchers wrote in their January 15 commentary: 

“Online gambling platforms, and especially those that are operating illegally, have emerged as among the most popular vehicles for cryptocurrency-based money launderers, particularly for those using Tether or USDT on the TRON blockchain, while also fueling the intensification of Southeast Asia’s rapidly growing illicit digital economy.”

Specifically, researchers claim that between September 2022 and September 2023, 17.07 billion transactions were “connected to underground currency exchanges, illegal commodity trades, unlawful collection and payment processes, and various criminal activities.” In one incident in China alone, police dismantled a $1.7 billion USDT-based money laundering network, with 63 suspects arrested and $18 million in cash seized. 

Tether has since rebuked the report. “The UN’s analysis ignores the traceability of Tether tokens and the proven record Tether has of collaborating with law enforcement,” the firm wrote, stating that it froze $300 million of cryptocurrencies in recent months upon law enforcement requests to combat the illicit use of digital assets. 

Thailand relaxes restrictions for crypto investors 

Thailand’s Securities and Exchange Commission (SEC) has canceled restrictions on retail investors purchasing digital assets backed by real estate or infrastructure. According to local news reports on January 18, the move is intended to facilitate capital infusions and support financing through digital technologies while “maintaining consistency with investment risks.” Before the policy was implemented, Thai retail investors were limited to a maximum purchase of 300,000 baht ($8,411) of such assets. 

The Southeast Asian country has been easing its restriction on digital assets since the electoral victory of Prime Minister Srettha Thavisin last year. As part of digitization initiatives, Thavisin has introduced a 500 billion baht ($14 billion) universal basic-income airdrop to all Thai nationals, to be financed using state borrowings. However, substantial restrictions apply as to how the tokens can be spent. 

Zipmex in trouble once again 

Embattled Thai crypto exchange Zipmex has been reprimanded by the Thai SEC once again. On January 13, the Thai SEC passed another resolution, following many previous inquiries, instructing Zipmex “to rectify its operations and submit the report of rectification to the SEC within 15 days to prevent damage to investors.” The Thai SEC wrote: 

“The rectifying order concerns the company’s failure to maintain fund in accordance with the governing regulations, and its improper and inadequate management and personnel structures. Additionally, the company may be subject to considerations regarding offenses related to client assets.”

Anek Yooyuen, the deputy secretary-general to the Thai SEC, warned that “any digital asset business operator failing to comply […] may subject to consideration of license revocation.” In Summer 2022, Zipmex filed for bankruptcy protection in Singapore after disclosing a $53 million exposure to failed crypto lenders Babel Finance and Celsius. 

On November 29, 2023, media reports revealed that Zipmex creditors would receive as little as 3 cents on the dollar for initial claims, with further payouts in a recovery scenario. Zipmex CEO Marcus Lim refused to confirm the cited details of a restructuring scheme but claimed “inaccuracies” in numbers cited by journalists. Last April, the firm lost a $100 million buyout deal sponsored by V Ventures after the latter withdrew. 

Singapore says no to Bitcoin Spot ETFs

Singapore has no plans to follow the U.S. SEC’s footsteps and list a Spot Bitcoin ETF for trading. 

As reported by local news outlets on January 17, a spokesperson for the Monetary Authority of Singapore (MAS) said that, “Bitcoin and other digital payment tokens (DPT) are not eligible assets for retail Collective Investment Schemes (CIS) at the moment.”

“Cryptocurrency trading is highly volatile and speculative in nature and is not suitable for retail investors. Those who still choose to trade Bitcoin ETFs in overseas markets must exercise extreme caution. In addition, they should carefully consider the additional risks associated with trading in overseas markets.”

The lack of listing plans, however, does not mean that Singaporean investors are barred from accessing Bitcoin Spot ETFs. Those with brokerage access to overseas securities, such as U.S. stocks and ETFs, can still access Bitcoin Spot ETFs without MAS restrictions. 

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Zhiyuan Sun

Zhiyuan Sun is a journalist at Cointelegraph focusing on technology-related news. He has several years of experience writing for major financial media outlets such as The Motley Fool, Nasdaq.com and Seeking Alpha.