OKEx Exchange to Resume Withdrawal Services As Founder Is Released From Police Custody

  • The china-based crypto exchange OKEx is set to resume withdrawals by November 27.
  • One of the ‘key private owners’ has been released by the Chinese police.

Troubled China-based crypto exchange OKEx is set to resume its withdrawal services starting Friday after a successful withdrawal test by the exchange. According to the reports, the exchange’s funds were locked beginning November 16th as one of the ‘private-key holders’ was held to help Chinese authorities in investigations.

Some outlets have reported that the mysterious private key holder is OKEx Founder, Mingxing “Star” Xu, who is rumored to be released from police custody. However, the exchange released a statement denying any connection with the founder.

Successful test withdrawals on OKEx

First reported by Crypto Quant, an on-chain analytics firm, OKEx moved about 0.02 BTC (~$380) from their wallet on Monday, signaling the exchange is getting its withdrawal service back up. According to Crypto Quant CEO Ki-Young Ju, the withdrawal opening could cause volatility across the crypto markets as OKEx users rush to withdraw their funds.

“I think #OKEx withdrawal reopening may cause volatility due to bulk withdrawal requests,” Ki tweeted.

The exchange withdrawals were halted on October 16th after one of the private key holders was under police custody assisting in an investigation. According to local media outlets, the private key holder is rumored to be the founder of OKEX, Star Xu.

The saga behind OKEx founder

OKEx users learned of the release of OKEx founder, Star Xu, bizarrely. The founder’s ‘WeChat Steps,’ an application within the WeChat messaging app that calculates steps, showed that he had started walking again. According to Xu’s WeChat statement, the Chinese police held him in custody due to a problem with the purchase of LEAP Holdings, a Hong Kong exchange-listed company, not the widely reported money laundering claims.

According to Decrypt’s reports, OKEx purchased LEAP Holdings to gain a “backdoor listing” on the Hong Kong stock exchange. However, questions arose from the millions of dollars Xu raised to buy the company – an issue that remains a mystery despite Xu’s release.

While the exchange’s private keys being “found” coincides with the OKEx founder’s release, the exchange released a statement distancing itself from Xu.

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Author: Lujan Odera

China’s Digital Currency to Roll-Out In A Second City After Successful Trials In Shenzhen

  • The second city in China is launching a lottery to test its digital currency/electronic payment (DC/EP) project, a local report states.

On Monday, local Chinese media The Paper reported that the district of Suzhou in Xiangcheng would launch a lottery to give away the country’s central bank digital currency (CBDC) in a bid to test the real-use cases of the digital currency. The ‘red envelop’ lottery is set to launch on December 12th across the city, a date known as Double 12 across China, and an end-year shopping festival.

The report said the lottery would be released similar to the one carried out in the city of Shenzhen in mid-October. In Shenzhen, the endeavor was a highly successful one, with over 50,000 participants winning 200 digital yuan each – totaling approximately $1.5 million. A later report confirms that over 95% of the digital yuan distributed were used in two weeks, stretching to over 3000 stores that accept the digital currency.

The city was chosen given the large prevalence of installed near-field communication (NFC) and QR code point-of-sales across merchant stores. Suzhou’s DC/EP trial is also set to introduce several new features not used in Shenzhen’s trial phase, such as the offline payment feature and the smartphone touch functions.

China’s DC/EP project will also launch a trial in Chengdu, which is preparing in anticipation by installing the NFC and QR codes point-of-sales. The People’s Bank of China (PBoC) also announced plans to launch the DC/EP project in the Winter Olympics venue in 2022.

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Author: Lujan Odera

FATF Needs to Narrow Down on DeFi Oversight; Not A One Size Fits All

The Financial Action Task Force (FATF) will need a new approach in crypto policing, according to XReg consulting senior partner, Siân Jones, who was speaking during the second V20 Virtual Asset Providers Conference. She particularly noted the emerging trends in Decentralized Finance (DeFi), a niche that Jones recommended FATF pay closer attention to to understand the nitty-gritty that would form part of future policy oversight.

So far, the FATF Travel Rule is the most advanced piece of oversight that governs Virtual Asset Service Providers (VASPs). The initiative, which came into action last year, requires service providers in the crypto sector to share personally identifiable information (PII) for transactions above $1,000 from one platform to another. To comply with the Travel Rule, stakeholders have some solutions, with the most popular being the InterVASP Messaging Standard (IVMS 101).

FATF Should Narrow Down on DeFi

While the Travel Rule has done it for most regulators, Jones brought FATF to pace with the developments in DeFi. She explained that DeFi removes intermediaries who would eventually make it hard for the AML watchdog to implement oversight on crypto activity within this space. Jones believed that FATF must consider new approaches to curb AML and terror-financing within this nascent industry. She said that,

“The tried and tested methods work, after a fashion, in the traditional world of money. Arguably, they can be made sort of fit the intermediated crypto world. They do not necessarily fit a DeFi world where they are not fit for purpose.”

Crypto Community More Effective in One Voice

Jones, who told DeFi stakeholders they need to ‘wake up and smell the coffee’ in matters regulation, also had some suggestions for the crypto community to enhance the cooperation in forming policies. She noted that FATF ought to double down its efforts in engaging the crypto community, including the DeFi developers. Likewise, the crypto community needs to work closer with FATF and present its opinion in a unified voice.

“Equally, the industry needs to work more closely together to present a unified voice and its engagement with the FATF and regulators.”

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Author: Edwin Munyui

Trezor Incorporates ‘Tor Switch’ in its Desktop App for Increased Privacy

The popular hardware wallet, Trezor, is working on providing its users’ privacy.

In its desktop app “Trezor Suite,” the cold wallet service provider has implemented the privacy project Tor to allow its users to obscure their connection.

Tor is an open-source network which has its servers distributed around the world run by volunteers and uses a special protocol that encrypts data at multiple levels. One can now not only enjoy the safety of the hardware wallet but the anonymity of Tor as well on Trezor.

“Tor is the perfect match for users who are concerned about sharing identifying data with a third-party service or anyone who might be observing their communications,” said Trezor in its announcement.

By downloading the latest public beta version of Trezor Suite, one can start using Tor with Bitcoin and other cryptocurrencies. Currently, The Tor switch is only available in the desktop app, located in the top-right of the Suite window.

Used by the likes of whistleblowers such as Julian Assange and Edward Snowden to evade espionage from the US governments and from journalists, security specialists, governments to individuals worldwide, Tor has helped protect human rights and individual freedoms.

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Author: AnTy

WEF Report Says Blockchain Is A Core Component in Sustainable Digital Finance

The World Economic Forum (WEF) recently released a new report about the future of digital finance on Wednesday. The WEF report noted that blockchain and Artificial Intelligence, the Internet of Things (IoT), and mobile platforms represent a core element of digital finance’s sustainable future.

The report noted that blockchain combines coming of age technologies with a sustainable environment-conscious business model. In the report, UBS executive Karin Oertli noted that all these nascent technologies could help organizations and governments to meet their sustainability goals. Oertli wrote,

“We believe that sustainable digital finance will play an essential role in efficiently channeling this capital to fuel innovation, growth, and job creation, at the same time supporting the transition to a sustainable, low-carbon economy.”

Currently, many European countries and top silicon tech firms’ save pledged to reduce their carbon footprint to zero in the next decade owing to the growing concern over climate change and global warming. Thus it has become even more important to bring sustainable business models to rescue the planet earth before it’s too late.

New WEF Report In Line With OECD Research

The latest sustainability report from WEF is not the first report of its kind, which has touted Blockchain as the key to sustainable future business models. It reinstates the research conducted by the Organization for Economic Cooperation and Development (OECD). The OECD report had made similar claims regarding blockchain and said,

“The core properties of blockchain and other DLT can enable deeper technological integration, standardization, and the possibility of new business models.”

Carbon dioxide emissions are growing significantly with each passing year. Some of the western countries have taken it upon themselves to make sure to cut their carbon footprint from now onwards.

The emergence of blockchain as key to a sustainable future comes just in time as crypto space has been battling the criticism over Bitcoin’s network electricity consumption and carbon emission.

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Author: Hank Klinger

Former Australian Senator With Highly Conservative Views Becomes the Next Bitcoiner

Former Australian senator Cory Bernardi describes Bitcoin as “the millennial’s version of gold.”

A Bitcoin convert, Bernardi took to Twitter to share that it has been only in the last couple of years that he became a bitcoiner.

“My conclusion is it is the millennial’s version of gold.

Still see risks attached but are basically the same as other asset classes – leg, confidence and demand. See demand getting stronger.”

He further mentioned Morgan Creek Digital partner Anthony Pompliano for advocating Bitcoin, to which Pomp said, “There are hundreds of people pushing content, education, and knowledge in the space. Complete team effort.”

Earlier this January, he left politics after serving under the Liberal Party for over a decade. Bernardi, who served as a senator for South Australia, is known for his highly conservative views.

Following his controversial career in politics, Bernardi now runs a membership-based website Confidential Community which, according to him, offers “more common sense than most people can handle.”

Last week was the only other time Bernardi tweeted about Bitcoin when he retweeted Pomp and said his self-proclaimed “famous” newsletter covered the impact of the election on Bitcoin and other potential asset classes.

In 2020 more and more high-profile people have publicly shared bullish views about Bitcoin and declared their BTC holdings. From Paul Tudor Jones, Stan Druckenmiller, Ben Miller to companies like Square and MicroStrategy have found Bitcoin as the best alternative asset class as a hedge against inflation and devaluing the US dollar.

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Author: AnTy

DoJ Challenges Visa’s Proposed $5.3B Acquisition of Plaid in a North California Court

The U.S Department of Justice (DoJ) has challenged Visa’s acquisition of financial data aggregation firm, Plaid. According to the filing on Nov 5, Visa’s move to initiate a transaction process for purchasing Plaid at $5.3 billion is a monopolistic approach. It deprives the American people of cheaper and better debit-focused innovations. The filing reads,

“By acquiring Plaid, Visa would eliminate a nascent competitive threat that would likely result in substantial savings and more innovative online debit services for merchants and consumers.”

It goes on to term Visa as a ‘monopolist in online business transactions’ given that it enjoys a market share of around 70% in the online debit transactions industry. The DoJ claims that Visa will be violating Section 7 of the Clayton Act and Section 2 of the Sherman Act as per the filing made in a North California based federal court. Both Visa and Plaid are defendants in this case, whereas the DoJ is the complainant.

While Plaid’s focus area is not the distribution of debit cards, this Fintech startup proposes a significant value in today’s world where data is the new gold. In fact, the firm received a strategic investment from both Visa and Master card back in 2019. This platform is designed to harmonize interaction between different databases held by financial service providers, including banks. Apparently, the firm was on its way to disrupt Visa’s fort in the online debit service before the ‘monopoly’ swung in to acquire them.

Per the DoJ filing, Visa’s senior executives, including the firm’s CEO, have previously hinted at the move to acquire Plaid as a strategy to neutralize competition. This strategic decision was particularly triggered by information that Plaid had plans to launch a parallel competition to Visa’s money movement business by the end of 2021.

At the time, Visa’s downside risk estimation for the next four years stood at $300-500 million, should Plaid have been acquired by a rival. This prompted them to act swiftly with the CEO noting that ‘Visa seeks to buy Plaid as an “insurance policy” to neutralize a “threat to our important US debit business.’ A statement that appears to have rattled the DoJ is now a focal point in its filing against Visa and Plaid.

Nonetheless, Visa has indicated through a spokesperson who shared with the Wall Street Journal that they intend to defend the Plaid transaction,

“Visa intends to defend the transaction vigorously … Visa’s business faces intense competition from a variety of players — but Plaid is not one of them.”

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Author: Edwin Munyui

Ant Group’s Record-Setting IPO Suspended in Hong Kong and Shanghai Over Regulatory Concern

The stock exchanges of Hong Kong and Shanghai announced on Tuesday that Ant Group’s much anticipated initial public offering (IPO), which would have been the largest stock sale at US$39.67 billion, was suspended less than 48 hours before the start of trading over regulatory concerns.

Just last month, co-founder Jack Ma talked about digital currencies being the future as he said the current system needs to be reformed, “one for the next generation and young people.”

Ma also criticized China’s financial regulator, saying the current regulatory system stifles innovation as he called for a revamp, which may have played a role in this suspension.

Earlier this week, Ant Group’s senior executives, including Ma, had a meeting with China’s top financial regulators and central bank officials that led to a “significant change” to Ant’s business environment.

According to Ant Group’s statement to the two stocks exchanges, the fintech company did not fulfill the listing requirement or disclosure rules. As such, the trading debut was postponed.

Retail investors who applied for the IPO, which was oversubscribed 389 times, will get a refund in two batches, reported South China Morning Post.

About 1.55 million small investors in Hong Kong contributed HK$1.3 trillion ($167.7 billion) into the highly awaited IPO offering, making it the highest amount to be refunded in history.

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Author: AnTy

Japanese Exchange, FXCoin, to Debut Volatility-Resistant XRP Remittance Solution with SBI

The Japan-based crypto exchange, FXCoin, has partnered with several financial heavyweights to develop a crypto-based remittance solution that is not affected by the market’s high volatility. Some of the players that will work with FXCoin on this product include SBI holdings, which already backs the exchange, having participated in its third-party share allotment.

FXCoin was launched back in 2018 by ex-dealers at Deutsche Bank but only received a trading license from the Japan Financial Services Agency (FSA) in December 2019. The exchange started accepting BTC accounts in April and later launched trading services. However, their cutting edge product is now an XRP built remittance solution that seeks to maximize crypto utility.

According to Nikkei, which first reported the new milestone by FXCoin, the pilot solution is set for debut later in the month. This price volatility-resistant solution will enable FXCoin users to efficiently calculate their transaction costs to avoid losses attributed to market swings. Notably, remittance prospects include domestic companies in Japan that transact globally.

The exchange had already signaled an intention to scale in crypto remittance solutions according to sentiments shared by Yasuo Matsuda, a senior strategist at FXCoin,

“Until now, crypto assets have been used mainly for speculative purposes due to the magnitude of price movements …

To establish the Swap market and expand the usage for actual demand, to do so, we will proceed with the demonstration experiment of domestic remittance and overseas remittance through XRP, and finally, global cash management, corporate finance, and trade.”

Nikkei was keen to note that the use case for crypto remittance solutions is in demand and will probably pick up if the FXCoin solution or one from its peer competitors proves to be successful. As it stands, SBI already leverages Ripple’s tech to provide a remittance solution dubbed ‘SBI Remit’ for Thai nationals in Japan. Other initiatives include a blockchain-based payment and remittance app ‘MoneyTap,’ which it co-launched with Ripple.

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Author: Edwin Munyui

The Cayman Islands Releases Phase 1 of Its Regulatory Framework for VASPs

The Cayman Islands, the Caribbean British Overseas territory, has announced through its Ministry of Financial Services that it has commenced developing a regulatory framework for Virtual Asset Service Providers (VASPs) within its jurisdiction. The island, which is notoriously famous for its ‘tax haven’ status, is looking to clear up ambiguities in running crypto operations as part of compliance with the Financial Action Task Force (FATF) guidelines, which were rolled out last year.

According to the press release on Oct 31, Cayman Islands classifies a virtual asset as a ‘digital representation of value that can be electronically traded and used for investment purposes.’ It has already enacted a set of rules to guide developing a VASP regulatory framework; these came into effect on Oct 28. Going forward, the island plans to roll out this process into two phases, with the initial one having commenced on Oct 31.

The first phase focuses on the compliance, supervision, and enforcement of Anti-money laundering (AML) and terror financing rules in line with the FATF and Cayman Island’s local guidelines. Prospective VASPs and those already operating in this tax haven will be required to register with the Cayman Islands Monetary Authority (CIMA). The second phase is slated for June 2021, and will focus on licensing requirements and prudential supervision.

Notably, the prospectus VASP regulatory framework will feature the FATF guidelines, some of which include the popular ‘Travel Rule.’ Currently, the island’s compliance with FATF is under assessment by the Caribbean Financial Action Task Force (CFATF), which will later report its FATF ratings. The Cayman Islands is optimistic that developing a regulatory framework will attract more firms to launch within its jurisdiction. The press release highlights,

“The Cayman Islands’ ability to regulate and attract persons and entities that deal with virtual assets as a business is now strengthened, with the commencement of legislation for virtual asset service providers (VASPs).”

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Author: Edwin Munyui