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Crypto Weekly Tidbits: Gemini Expansion, China Targets U.S. Dollar Hegemony

June 22, 2020

China has once again turned to crypto to put a stop to the U.S. Dollar hegemony in international payments. The world’s second-largest economy wants to see the creation of a regional digital currency backed by a basket of currencies. India is reportedly mauling a new bill that could hamper cryptocurrency growth in the country. The U.S. cryptocurrency exchange Gemini eyes expansion into Singapore after making a local hire. 

This and more in this week’s edition of crypto tidbits.

CryptoCompare Preparing to Launch Crypto Indexes in Asia

The high demand for bitcoin and cryptocurrency trading in Asia is not a secret. For this reason, the cryptocurrency data provider CryptoCompare has set its eyes on launching cryptocurrency indexes in Asian markets. 

The crypto data provider aims to drive the trading of digital assets and the use of market data in the region. The talks to offer this product began in April with an unnamed partner and is expected to be ready by August.

CryptoCompare Commercial Director James Harris claims that big Asian institutional players are looking at the data vendor, making the region a good market to target.

“We think the Far East will be fertile grounds for us – some of the big institutional names in Asia are really looking at us,” said Harris.

China Considers East Asia Regional Cryptocurrency to Target U.S. Dollar Hegemony

China has once again come up with another crypto-related plan to rival the hegemony of the U.S. Dollar in international payments, Nikkei Asia reported

The Chinese People’s Political Consultative Conference, the country’s top political advisory body proposed the development of a regional digital currency tied to a basket of currencies from the region. The digital currency would be backed by the Chinese Yuan, Japanese Yen, Hong Kong Dollar, and the South Korean Won among others.

The idea was thrown forward by Neil Shein – a Chinese entrepreneur and venture capital investor – and Henry Tang, a Hong Kong politician among others. The digital currency, according to the report, will be created by the private sector.

The yuan and the yen will respectively account for 60% and 20% of the currency’s value as weights of the individual currencies will be calculated based on the economic scales of individual member countries.

It is possible that the new idea was inspired by Facebook’s Libra project, a digital currency tied to a basket of currencies such as the USD, Euro, British Pound, etc. China accelerated the creation of its own national cryptocurrency after Facebook announced Libra mid last year.

The East Asia cryptocurrency seems to be a tool that could fall in line with China’s intentions to create a new payment network outside the USD. The U.S. has weaponized its currency and uses its global influence to impose sanctions on other countries.

India Floats Another Bill that Could Potentially Kill the Crypto Sector

India’s fragile regulatory relationship with the cryptocurrency sector took another huge blow after inter-ministerial consultations by the finance ministry threatening to ban virtual assets in the country, media reports claim. 

The new reports bring to an end the country’s Crypto Spring that began in March when the Supreme Court lifted the ban on cryptocurrencies. The Supreme Court ruling saw a resurgence in crypto trading.

The previous bill sought to criminalize the buying, selling, trading, and possession of cryptocurrencies and offenders could be sentenced up to 10 years in prison. The new bill criminalizes crypto possession but is not yet clear if it still carries harsh sentences proposed in the previous bill.

The initial ban did not outrightly kill cryptocurrency trading in the country, but rather, pushed traders to turn to peer-to-peer platforms. CoinDCX, a cryptocurrency exchange, continued operating even during the ban. The exchange claimed to have experienced a rise in trading volume and users after the Supreme Court reversed the central bank’s ban on digital assets.

Ripple Publishes Policy Paper on How India Can Approach Crypto Regulation

There is a regulatory vacuum in India’s crypto space that Ripple, the company behind the XRP coin, is keen on filling in. The company has published a policy paper titled “The Path Forward for Digital Assets Adoption in India” aimed at providing cryptocurrency regulatory clarity in the country.

According to the policy paper, India should adopt a digital asset taxonomy in line with global trends, enact legal framework at the Gujarat International Finance Tec-City (GIFT) to attract foreign players, remove “cryptocurrency” and “crypto asset” from the central bank’s regulatory sandbox because these words carry negative connotations, and amend specific financial sector laws to accommodate digital assets.

In a blog post, Ripple urged India to take a positive approach towards crypto regulation so that the country can benefit from the young industry.

Now is the time for India policymakers to take the forward-looking approach that many other jurisdictions have taken. Under a clear regulatory framework, consumers and businesses can confidently take full advantage of and operate within a safe environment that encourages the use of innovative technology,” wrote Ripple.

Japanese Financial Giant Nomura Holdings Launches Digital Asset Custody Services

Japanese bank Nomura Holdings has partnered with Coinshares and Ledger to launch a digital currency custodial service to safeguard virtual currencies for financial institutions. 

The joint venture was initially announced in 2018 and is under the regulation of the Jersey Financial Services Commission. Called Komainu, the new custody service will be led by Jean-Marie Mognetti, the co-founder and CEO of digital asset management firm Coinshares.

“We have been trialing the platform with a limited number of clients for four to five months and are now launching to new clients,” said Mognetti.

The partners said the platform will only custodial services to tokens that adhere to anti-money laundering regulations.

Nomura Holdings offers retail and investment banking and asset and security management services in its home country. The financial firm also has a number of smaller subsidiaries operating outside the financial industry.

Singapore’s Carpooling App Supports Bitcoin Payment

Singapore’s first carpooling app, Ryde, has now made it possible for customers to pay for their rides using bitcoin. Starting in a week’s time, users can now convert and store their bitcoins to Rydecoin, the company’s native currency.

Customers are allowed to convert a maximum of $999 to bitcoin at a time. The company claims to be the only ride-sharing firm allowing customers to pay for rides using bitcoin stored in its own digital wallet.

However, the company is not the first to integrate cryptocurrency. Uber partnered with Fold to enable payments using bitcoins.

The U.S. Crypto Exchange Gemini Plans to Expand to Singapore

The U.S.-based cryptocurrency exchange and custodian Gemini is planning to expand into Singapore. The exchange has made its intentions clear by appointing Jeremy Ng as the firm’s Asia-Pacific managing director.

With the new appointment, the exchange can now apply for a license with the Monetary Authority of Singapore (MAS) under the country’s 2019 Payment Services Act. According to the act, one of the requirements for a license application is one of the company’s directors must be a Singaporean citizen or permanent resident. Ng resides in Singapore.

Ng has spent about 20 years working in Hong Kong and Singapore’s financial services sector. He will be reporting directly to Cameron Winklevoss, the President of the exchange.

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