Dubai's Registration for Crypto Businesses, CoinSpot Hacked, Kazakhstan to Blocks Coinbase, and Hong Kong Tokenized Regulations

Dubai's VARA Registration for Crypto Businesses

Dubai's Virtual Assets Regulatory Authority (VARA) has urged all local businesses to register or acquire a license by November 17 to operate within the emirate. Failure to comply could lead to decommissioning.

With over 1,000 legacy companies applying to register under Dubai’s distinctive regulatory framework, the city demonstrates its commitment to fostering a transparent and resilient virtual asset ecosystem, cementing its global presence.

Law No. 4 of 2022 established VARA, marking the formal inception of Dubai's regulated Virtual Assets sector with the release of VARA regulations in February 2023. This sector encompasses both traditional companies involved in Virtual Asset activities and specialized Virtual Asset Service Providers (VASPs). Consequently, all legacy operators in the Emirate must obtain licenses or registrations under VARA.

VARA has launched a specialized licensing team that actively conducts an expedited domestic outreach initiative, expanding upon collaborative efforts with the Department of Economy and Tourism (DET) and the Dubai Free Zone Council (DFZC) throughout 2023. The VARA in Dubai intensifies its engagement with the virtual asset market to ensure adherence to established regulations. A key emphasis remains on obliging all Virtual Asset Service Providers (VASPs) operating in the Emirate to secure licensing to continue their operations.

Scorechain has been helping crypto businesses in meeting regulatory requirements, ensuring compliance with rules to prevent crypto crimes, and enhancing credibility.

Request a demo NOW!

CoinSpot Hacked for $2.4 million

Australian cryptocurrency exchange CoinSpot recently experienced a security breach, with approximately $2.4 million in Ethereum ($ETH) stolen. On November 8, large transactions of ETH were detected moving to an unknown wallet. The breach was attributed to a probable private key compromise in one of CoinSpot's hot wallets, leading to the unauthorized transfer of 1,262 ETH, valued at $2.4 million. The stolen funds were swiftly moved through ThorChain and Wan Bridge to the Bitcoin network, exchanged for 24 Wrapped Bitcoin (WBTC) via Uniswap to hide the track of the funds.

The hackers' strategy involved splitting and distributing the stolen funds across multiple wallets, complicating tracking efforts. Unraveling the web of blockchain transactions poses challenges for cybersecurity experts, with each transaction making it increasingly difficult to trace the stolen assets.

Despite CoinSpot's substantial user base of around 2.5 million and its support for over 400 cryptocurrencies since its establishment in 2013, the exchange has yet to issue an official statement regarding the incident. The breach demonstrates the necessity for heightened blockchain security measures to counter such attacks.

Kazakhstan to Blocks Coinbase Crypto Platform?

The Ministry of Culture and Information of Kazakhstan has officially confirmed the blocking of Coinbase, a major cryptocurrency exchange, as part of the government's stringent regulatory approach to the crypto sector. This move aligns with the nation's commitment to enforce domestic regulations, addressing concerns related to money laundering, consumer protection, and financial stability in the crypto market.?

Kazakhstan, known for its booming bitcoin mining industry, has faced scrutiny for limiting access to significant crypto platforms. The ban on Coinbase is rooted in alleged violations of Kazakhstan's Law on Digital Assets, enacted in February 2023, prohibiting cryptocurrency exchanges without a national license from the Astana International Financial Center (AIFC). The crackdown extends beyond Coinbase, affecting various crypto exchanges and brokers, and impacting both local and foreign businesses.?

Financial analyst highlights the growing uncertainty in Kazakhstan's crypto industry, sparking broader discussions on the nation's regulatory approach to cryptocurrencies and international financial services in this evolving digital landscape.

Hong Kong SFC to Redefine Tokenised Securities Regulations

Hong Kong's Securities and Futures Commission (SFC) issued 2 vital circulars, the Tokenised Securities Circular and the Investment Products Circular, offering essential guidance to intermediaries involved in tokenised activities. These circulars mark a significant departure from the SFC's previous stance, particularly the March 2019 statement, as they redefine tokenised securities as traditional financial instruments using distributed ledger technology (DLT).?

The Tokenised Securities Circular emphasizes that the established legal and regulatory requirements for securities now apply to tokenized securities, abandoning the prior professional investor-only restriction. The SFC introduces a see-through approach, directing intermediaries to evaluate the complexity of tokenized securities based on the underlying traditional security. While there is no mandatory professional investor-only restriction, offerings to the Hong Kong public are still subject to prospectus and offers of investment regimes.?

The SFC underscores that existing conduct requirements for securities-related activities extend to the distribution, advising, management, and secondary market trading of tokenized securities.

About Scorechain?

Scorechain, a leading Blockchain Analytics provider based in Luxembourg, distinguishes itself in the rapidly transforming realm of cryptocurrency compliance. With a steadfast commitment to data protection and integrity, Scorechain offers several unique selling points including API-Centric Seamlessness, Fully Automated Monitoring, and Anticipatory Threat Detection with Actionable Insights.

Scorechain’s platform provides identifying data and risk assessment for all major blockchains. The platform connects to different sources and block lists to provide risk scoring on crypto assets, transactions, addresses, and entities. The risk assessment methodology applied by Scorechain has been verified and is fully customizable to fit all jurisdictions. Customers can monitor infinite possibilities of risk scenarios with a wide range of parameters provided so businesses under the scope of the crypto regulation can report suspicious activity to authorities with enhanced due diligence.