Last Week in Global Markets: Mar 27-Apr 2, 2023
Three weeks after the demise of major banking institutions, investors are increasingly viewing the crypto sector as a "safe haven" amidst concerns over traditional finance stability. For the first time in the last 7 weeks, total asset flows in digital asset investment products netted a positive $160 million of capital inflows.?
Meanwhile, major economies are approaching crypto in seemingly opposing means. G-7 nations are taking a tougher stance, while Hong Kong continues to attract a strong influx of crypto companies and services in the semi-autonomous region.
This, and more from last week.
Let's dive in.
G7 nations call for tighter crypto regulations
The G-7 countries are planning to push for tighter global regulations on cryptocurrencies, with a focus on increasing transparency and consumer protection at a May meeting of finance ministers and central bankers.
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During a hearing with U.S. lawmakers, SEC Chair Gary Gensler requested more staff and resources to regulate the cryptocurrency industry due to its noncompliance and misconduct issues, intending to expand the agency's enforcement and examination divisions to combat risks in crypto, cybersecurity, and market infrastructure resiliency.
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The UK government is planning to combat economic crime including the regulation of crypto assets to promote innovation while preventing illicit use. To achieve this, the Financial Conduct Authority will collaborate with international agencies to exchange information on the regulation and supervision of crypto assets.
Crypto flourishes in Hong Kong
Hong Kong has experienced an influx of crypto companies after its recent shift in policy, with Chinese banks offering banking services to local crypto firms, seizing the opportunity left by the failures of US tech banks. Chinese officials have also been spotted participating in digital asset events in the city.
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To assist in financing the crypto sector, Hong Kong regulators are organizing a round-table discussion between crypto firms and bankers. The event, scheduled later this month, aims to facilitate direct dialogue and sharing of practical experiences regarding opening and maintaining bank accounts.
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China aims to upgrade national blockchain standards
China is focusing on developing its fintech industry, specifically blockchain technology, despite its stance against cryptocurrencies. The country also plans to establish a national blockchain research center to connect universities, developers, and businesses and drive industry expansion.
Digital asset investment inflows surge as fears within the traditional sector grow
Last week, digital asset investment products received inflows of $160 million, the largest since July 2022, as investors increasingly view the sector as a "safe haven" amidst concerns over traditional finance stability. This comes after last week’s report of 6 consecutive weeks of outflows totaling $406 million.
Asian companies lead the Web3 gaming sector
The Asia-Pacific region is at the forefront of the Web3 gaming trend, with the potential to propel its global adoption. Nearly two-thirds of the world's biggest gaming firms hail from China, Japan, and South Korea. The overall Web3 gaming sector is quickly expanding as well, accounting for half of the blockchain industry's on-chain activity.
How Web2 feels about Web3
Amazon is working on its own NFT platform, which will operate on a private blockchain controlled by the company. This platform is expected to showcase digital collectibles created by leading crypto-based artists and will receive significant promotion during Prime Day, scheduled to take place on July 22 and 23.
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Disney has restructured by eliminating its next-gen storytelling and consumer-experiences metaverse unit, resulting in the loss of all 50 team members' jobs. Current plans for Disney's metaverse strategy are unclear, and their initial effort to create a membership initiative has been abandoned.
That's a wrap. See you next week.