The Crypto 5

Greetings,

It's the international edition of the Crypto 5 - catching you up with new regulations in Hong Kong, Japan's crypto boom, and how crypto is helping recovery efforts in Turkey and Syria.

Don't forget,?share this newsletter?as a belated Valentine's day present!?I've?heard?sharing is caring.

1. Hong Kong OK's crypto for professional investors

Regulators in Hong Kong will provide access to crypto for accredited professional investors from 1 June 2023, bringing further clarity and certainty to businesses.

The announcement follows statements made by city officials in January that it aims to become a regional crypto hub. Paul Chan, the city's financial secretary, said "Hong Kong will be a great place for crypto, fintech and other startups to set up shop in the new year." Hong Kong is moving forward in the crypto space as Singapore seems to be narrowing its focus.

While retail investors will have to wait, Hong Kong's "regulator is?expanding its headcount?to deal with an anticipated flurry of license applications."

2. Bank of Japan's CBDC pilot to launch in April

After two years of experimentation, the Bank of Japan will pilot a digital yen in April. Why? Japan wants to catch up: "To a certain extent, we need to move in lockstep with other advanced economies," the project's manager said.

Japan will be in good company. This year Australia, Thailand, South Korea, and India are expected to launch their own Central Bank Digital Currency (CBDC) pilots. Currently, 114 countries, representing over 95 percent of global GDP, are exploring a CBDC. China is widely regarded as the most advanced in space - some 6 or 7 years ahead of the rest of the world.

Even though a CBDC is a digital version of the dollar, yen, or euro, a complex regulatory machine needs to be in place behind it. Key concerns around consumer protection and privacy must be in place before it can be rolled out.

3. Japan doubles down on crypto

Two Japan stories this week. The country seems to be moving full speed ahead into the digital asset space. Here's whats coming:

• "A small but active group?of politicians?is proposing guidelines for everything from decentralized autonomous organizations (DAO) to non-fungible tokens (NFT).
• It’s getting easier for Japanese exchanges to list tokens. One?onerous tax requirement?has been revised, marking a major win for crypto entrepreneurs.
• Coinbase and Kraken withdrew from Japan, but Binance, which?irked Japanese regulators?in the past, managed?to acquire?a Japanese exchange.
• And?stablecoins,?which are currently not allowed on Japanese exchanges, have a new path forward."

Why is Japan not concerned about FTX? Regulation.

• Regulators and government leaders said FTX had no impact on their outlook for the future of digital assets.
• “It is likely that FTX Japan’s Japanese customer assets will be returned without a significant impact from the Chapter 11 global bankruptcy filing,” said Ryosuke Ushida, chief fintech officer at the Financial Services Agency, the government agency that regulates crypto.
• “In most jurisdictions there is no segregation of crypto assets. In Japan they are legally separated. That makes it easier for FTX Japan to return the money.”

4. India wants global crypto regulations

India holds the?G-20 presidency seat?this year and, according to Bloomberg, crypto regulation is one of the top points for discussion. Since the technology is global, ministers have urged a universal framework to protect consumers.

India wants to work with the IMF and the Financial Stability Board on next steps. India is set to host the G20 finance ministers and central bank governors later this month.

Vietnam, the Philippines and India rank in the top 4 for global crypto adoption. While India has imposed some of the harshest tax rates for crypto, this latest announcement could be a promising move for the country.

5. Millions donated to relief efforts in Turkey and Syria

$15 million in crypto has been raised so far for relief efforts in Syria and Turkey.

Unlike traditional money transfers which can require bank accounts, take days to transfer and cost high fees, crypto can be accessed instantly, by anyone, and converted into local currency at much lower costs.

For example, in the early days of the war in Ukraine, government officials said crypto was their lifeline for early purchases of equipment and called for further donations in this form.

"The Turkish government followed in Ukraine's footsteps and the Turkish financial intelligence unit MASAK gave an unprecedented green light for a one-week crypto donation campaign established by AHBAP – one of the country's most reputable humanitarian organizations."?

"A number of established global charities sending aid to Turkey – such as Save the Children US – have emphasized their willingness to receive cryptoasset donations. The The Giving Block – which facilitates crypto donations to a range of charities – has also?announced that donors can donate?to a number of charities assisting with relief efforts through its service."

More details on reputable places to donate can be found here.