Tag Archives: need

Is There a Need for a Third Exchange License in Hong Kong?

Is There a Need for a Third Exchange License in Hong Kong?

The Securities and Futures Commission (SFC) of Hong Kong is indeed committed to developing a digital asset center in Hong Kong. The SFC’s proactive approach towards regulating and embracing digital assets is a significant step towards enhancing Hong Kong’s role as a major financial hub. By providing clear regulatory guidelines and granting licenses to digital asset exchanges, the SFC is fostering a secure and regulated environment for digital asset trading. This not only attracts more institutional investors to the digital asset market but also strengthens investor confidence in digital assets. The SFC’s initiatives are expected to further promote the growth and development of the digital asset industry in Hong Kong.

The SFC’s decision to embrace crypto trading has enabled more licensed players in the Hong Kong scene. The recent approval of the Hong Kong Virtual Asset Exchange (HKVAX) as the third licensed crypto exchange in Hong Kong marks a significant step in Hong Kong’s evolving crypto landscape. The journey to establish Hong Kong as a robust crypto and digital asset hub has been met with challenges, but the emergence of new players like HKVAX raises questions about the need for a third exchange license and the potential financial viability of another player in the market.

Overview of the current exchanges

HashKey Exchange is Hong Kong’s first licensed retail virtual asset exchange. It provides a safe and reliable crypto trading platform for BTC, ETH, and other cryptocurrencies. HashKey Exchange is licensed by the Securities and Futures Commission of Hong Kong (SFC) with Type 1 (Dealing in securities) license & Type 7 (Providing automated trading services) license. It also holds a TCSP license (Certification No. TC006486).

OSL is a digital asset platform that provides regulated solutions for institutions, corporates, and professional investors. They are also granted Type 1 & 7 digital asset licenses by the SFC in Hong Kong. On August 3, 2023, OSL received an SFC license uplift, enabling retail investors to trade Bitcoin and Ethereum.

On the one hand, it could be argued that the existing two exchanges, HashKey Exchange and OSL, are already meeting the demand for crypto trading services in Hong Kong. These exchanges offer a wide range of features and services, including spot trading, margin trading, and derivatives trading. They also have a good reputation for security and compliance.

On the other hand, there are a number of factors that could suggest that there is still room for another exchange in Hong Kong. First, the crypto market is still growing rapidly, and there is a demand for more choice and competition among exchanges. Second, the existing exchanges are not without their critics. Some have accused them of being too restrictive in their trading policies, while others have raised concerns about their security practices.

Whether or not there is a need for a third exchange licence in Hong Kong is a matter of opinion. However, the approval of HKVAX suggests that the SFC believes that there is still room for growth in the crypto market in Hong Kong.

Is there enough room for growth?

The answer to this question depends on a number of factors, including the size of the crypto market in Hong Kong, the fees charged by exchanges, and the level of competition.

The crypto market in Hong Kong is still relatively small, but it is growing rapidly. In 2022, the total trading volume of cryptocurrencies in Hong Kong was estimated to be around $100 billion. This is expected to grow to over $200 billion by 2025.

The fees charged by exchanges vary, but they are typically around 0.1% to 0.2% of the trading volume. This means that an exchange with a trading volume of $100 billion would generate around $100 million in fees per year.

The fees are not the only determining factor. While the regulatory framework prioritizes consumer protection, it’s important to consider whether the balance between safeguarding investors and fostering innovation is being adequately struck. The current regulatory limitations, such as the 12-month cooling-off period for token listings, restrictions on crypto derivatives, staking, airdrops, and the ban on stablecoins, appear to hinder the development of a comprehensive digital asset market. This would also mean that the exchanges will miss out the current hype and revenue from newly hyped-up tokens.

Is there enough liquidity depth for Hong Kong Dollar pair? That is another issue totally. The level of competition in the crypto exchange market in Hong Kong is also growing. In addition to the three licensed exchanges, there are a number of unlicensed exchanges operating in the city. This competition could drive down fees and make it more difficult for new entrants to make a profit.

Conclusion

Overall, it is difficult to say definitively whether or not there is enough money to be made for one more player in the crypto exchange market in Hong Kong. However, the factors discussed above suggest that there is a good possibility that a third exchange could be successful.

Maybe a final comment from my end is from an economic viability point of view. With the emergence of HKVAX as the third licensed exchange, questions arise about the potential profitability of additional players in the market. While having a competitive landscape can drive innovation and enhance user experience, it’s essential to assess whether the existing demand for crypto trading services can sustain another entrant. The revenue potential, user base growth, and differentiated offerings are factors that should be considered before granting further licenses.

The approval of HKVAX as the third licensed crypto exchange in Hong Kong is a significant milestone for the city’s crypto industry. It suggests that the SFC is committed to creating a favorable regulatory environment for crypto businesses. However, it remains to be seen whether there is enough demand and profit potential to support another exchange in Hong Kong.

 

 

Source: https://www.securities.io/is-there-a-need-for-a-third-exchange-license-in-hong-kong/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

What Investors Need to Know About BRC-20 Tokens

What Investors Need to Know About BRC-20 Tokens

Previously, I have talked about Ordinal inscriptions and what it means for the future of Bitcoin. Here’s an update on the BRC-20 token.

BRC-20 is a new experimental fungible token standard designed for the Bitcoin blockchain, inspired by Ethereum’s ERC-20 token. In the last few weeks, you may have heard this term from your friends or seen posts on social media about BRC-20 memes and NFTs.

As of May 2, the combined market capitalization of over 8,800 BRC-20 tokens was $137 million, a remarkable 682% increase from $17.5 million just a week ago. But a week after, as of May 9, the market capitalization of BRC-20 Bitcoin tokens had exceeded $1 billion, and within the previous 24 hours, there was a total trading volume of $207.7 million. These tokens can be tracked on brc-20.io or traded on Ordswap. Some of them are also available on Gate. As more wallet providers and more centralized exchanges integrate, I believe there will be more movements within their ecosystem.

What is BRC-20?

This standard was created for the Bitcoin blockchain by an anonymous on-chain analyst called Domo. It is being used to issue and transfer fungible tokens on the Bitcoin blockchain. BRC-20 is similar to the ERC-20 token standard used on the Ethereum blockchain but specifically designed for Bitcoin. BRC-20 uses Ordinal inscriptions of JavaScript Object Notation to deploy token contracts and mint and transfer tokens.

BRC-20 tokens are stored on the Bitcoin base chain and built with the help of Ordinals and Inscriptions. An Inscription or Ordinal is a unique number attached to a specific piece of digital content, such as an image, video, or text, stored on the Bitcoin blockchain. Inscriptions are generated using a special protocol that ensures their uniqueness and immutability, making them valuable digital assets that can be bought, sold, and traded just like NFTs. These tokens can be attributed to satoshis and then traded or swapped with others, just like other tokens.

Adding on to the above points and to give some context, BRC-20 tokens were made possible by a loophole in Bitcoin’s 2021 Taproot upgrade, which allowed for the attachment of small amounts of arbitrary data to each transaction to limit the amount of data stored on the blockchain. BRC-20 tokens use this feature to add additional data to individual satoshis, which can then be used to create various types of assets and tokens.

How different are BRC-20 and ERC-20?

The BRC-20 token standard utilizes the proof of work (PoW) mechanism, while the ERC-20 uses the proof of stake (PoS) mechanism. PoW is a consensus mechanism in blockchain networks to validate transactions and add new blocks to the chain.

In PoW, miners compete against one another to solve complex mathematical problems using high-powered computational devices. PoS protocols are a class of consensus mechanisms for blockchains that work by selecting validators in proportion to their quantity of holdings in the associated cryptocurrency.

Unlike PoW, which relies on solving complex computational problems, PoS requires validators to stake a certain amount of cryptocurrency before participating in the consensus process. Validators are chosen based on the amount of cryptocurrency they have staked, with those who have staked more having a higher probability of being selected to validate transactions.

The significant difference between the two networks is EVM (Ethereum virtual machine) compatibility. The BRC-20 token standard does not support smart contracts, which limits the ability of developers to create different programmable tokens and financial products.

Understanding memecoins popularity

Due to the explosive growth of the BRC-20 token standard, particularly with the introduction of memecoins such as Pepe and Memetic, these coins are becoming increasingly popular on BRC-20. In just four days, the BRC-20 token market capitalization has soared from $95 million to $279 million, with over 13,530 tokens currently in circulation. The top five BRC-20 tokens, Ordi, Pepe, Piza, Memetic, and Moon, make up 86.55% of the total market capitalization.

Memecoins may be moving to BRC-20 due to the Ethereum network becoming congested by these coins. One notable meme token, Pepe, has contributed significantly to this congestion. BRC-20 tokens, which are an experimental token standard on the Bitcoin blockchain modeled after Ethereum’s ERC-20 tokens, enable developers to create and transmit fungible tokens through the Ordinals protocol. The rise of memecoins has made BRC-20 tokens more popular in the cryptocurrency community.

 

It’s important to note that the number of daily transactions on the Bitcoin network hit a new record of 682,000 recently, up from 250,000 daily transactions at the beginning of 2023. As a result, all BRC-20 transactions must take place on-chain, which has rapidly filled up the limited space in Bitcoin blocks. Due to memecoins and BRC-20s, Bitcoin and Ethereum fees have soared.

 

What to look out for on BRC-20

 

The surge in memecoins’ popularity on BRC-20 can be attributed to the explosive growth of the BRC-20 token standard and the congestion on the Ethereum network caused by memecoins. This is like teaser marketing in my point of view.

 

One of the primary use cases for BRC-20 tokens is in the area of decentralized finance (DeFi). BRC-20 tokens have found utility in decentralized finance applications like lending, borrowing, and yield farming. Unlike rigid Bitcoin, BRC-20 tokens are more flexible and can be used in various decentralized financial applications.

Another use case for BRC-20 tokens is peer-to-peer transfers. BRC-20 tokens utilize the Bitcoin network and can be moved between wallets on the network. The most basic thing one could do with a BRC-20 token is to transfer it to their peers as a representation of value. In the future, I would foresee that the demand for real asset tokenization on BRC-20 will continue to grow.

The development of BRC-20 tokens is continuing at a rapid pace, and it is likely that more use cases will emerge in the future. The impact of BRC-20 tokens has been significant, considering they began as an experiment. The tokens have exploded in popularity in the crypto community, and over 14,000 BRC-20 tokens are deployed on Bitcoin compared to an estimated 400 million on Ethereum. This means that there is still lots of room for growth.

 

Source: https://intpolicydigest.org/what-investors-need-to-know-about-brc-20-tokens/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

What is green satoshi token (GST)? What you need to know about Stepn’s in-game currency token

What is green satoshi token (GST)? What you need to know about Stepn’s in-game currency token

The green satoshi token (GST) is the native cryptocurrency of the first-of-its-kind Web3 lifestyle app STEPN, which encourages users to stay active by rewarding them in GST tokens.

The token started 2022 with a kick, seeing its value surge by more than 300% from its debut in late December 2021 at $1.8 to an all-time high of $7.8 on 29 April 2022. Since then, however, the token dipped, losing over 99.7% of its gains down to $0.0223 as of 25 November 2022.

So, what is green satoshi token (GST) and how does it work?

What is green satoshi token (GST)?

A pioneer in the move-to-earn (M2E) sphere, STEPN inspires crypto fans to exercise or “move around” while earning the platform’s native coin – the green satoshi token (GST).

According to the STEPN platform’s whitepaper: “With Game-Fi, STEPN aims to nudge millions toward a healthier lifestyle, combat climate change and connect the public to Web 3.0, all while simultaneously hinging on it’s Social-Fi aspect to build a long-lasting platform fostering user generated Web 3.0 content.”

STEPN announced its public beta release on 20 December 2021 and was launched by the Australia-based fintech studio, Find Satoshi Lab.

Users get to purchase and equip themselves with non-fungible tokens (NTFs) in the shape of sneakers that are used for jogging, walking or running outdoors.

The game has four types of NFT Sneakers designed to fit different fitness levels. In addition, STEPN Sneakers are ranked by five different qualities that are given to them at random, thus establishing their rarity.

Users can purchase new Sneakers through the in-game NFT marketplace or create their own by “breeding” two Sneakers they already own through what the platform calls a Shoe Minting Event (SME). Each Sneaker can be bred up to seven times. The more a Sneaker was bred, the more tokens it will cost.

STEPN has three game modes.

  • Solo Mode: Users are equipped with NFT Sneakers and can earn GST coins through either walking or running. Their progress is tracked via a GPS signal. Users are given a certain amount of energy which allows them to earn GST tokens. Once that energy runs out, tokens can no longer be earned.
  • Marathon Mode: Users can participate in a weekly or monthly marathon of their chosen distance. At the time of writing, the marathon mode was currently under development.
  • Background Mode: Users will be able to continue gaining GST tokens while the STEPN is running in the background. As long as a user owns an NFT Sneaker, the app will be able to collect the user’s step data from their mobile’s health app. At the time of writing, this mode was also under development.

How does green satoshi token work?

It is important to note that STEPN has a dual token system; the green satoshi token cryptocurrency and the green metaverse token (GMT).

The GST coin is the in-game token of the STEPN ecosystem, while GMT is its governance coin.

So, what is the green satoshi token used for?

GST has an unlimited supply and can be earned by users through moving. GST is paid out for every minute of movement. The amount of GST paid out to users depends on the type of Sneaker they own and its unique attributes.

Because STEPN was built on the Solana (SOL) ecosystem, the GST coin was introduced on the Solana blockchain and then in May 2022 also added to the BNB Chain (BNB), formerly called BNB Smart Chain (BSC).

“To ensure the stability of GST, STEPN is designed with plenty of burn mechanisms. These involve upgrading your in-game assets like shoes and gems, unlocking gem sockets, and repairs. GST is also used to mint new shoes,” STEPN said in a blog post.

GST can be notably considered one of the more successful cryptocurrencies of 2022, despite the overall bear market that followed most cryptocurrencies at the start of the year.

The coin surged by around 350% within four months from $1.7443 on 22 December 2021 to $7.8337 on 29 April 2022 – its all-time high – as the company pledged to combat climate change and achieve carbon neutrality through the purchase of $100,000 worth of Carbon Removal Tonnes and the GTS token was listed on the popular crypto exchange Coinbase.

The positive rally did not last long, however, and GST managed to lose over 45% of its gains overnight dropping to $4.121, ahead of the release of the platform’s Public Beta Phase IV. By 3 May 2022, the token managed to resurface, surging past $6.5.

As hype surrounding STEPN and its native cryptocurrency started to decline, and the economic situation worldwide deteriorated, GST embarked on a bear run, losing over 97% of its gains from its 3 May 2022 value, down to $0.1804 by 13 June 2022.

DappRadar’s third-quarter gaming report published in October 2022 noted that STEPN “has cooled down after a torrid Q2” and its monthly active users decreased by 67%, falling to 482,000. In comparison, during Q2, STEPN registered over 2 million monthly users and over 260,000 new wallets.

By 23 November 2022, GST lost an additional 87.6% of its price down to $0.0223.

Latest GST news and price drivers

STEPN was the first ever earn-to-move blockchain to be released and with no competition at the time managed to surge to certain heights. However, competition was inevitable with the release of Sweat Economy, another move-to-earn blockchain, which according to DappRadar minted a record-breaking 10,000 NFTs in September 2022.

Additionally, uncertainty surrounding the Solana blockchain has been on the rise since the FTX crypto exchange, which is closely tied to Solana, filed for bankruptcy on 11 November. Since STEPN was built on the Solana blockchain, the GST coin is also affected by either positive or negative movements in Solana’s native cryptocurrency SOL.

In other news, STEPN announced on 18 November that it has launched an in-app event to celebrate the FIFA World Cup, top international sporting events of 2022, and encourage users worldwide to move and participate.

Moreover, STEPN has also partnered with ASICS and Solana to “pave the way for the Web3 fitness industry” by launching a new UI sneakers Collection.

Risk and opportunities

Anndy Lian, the chief digital advisor at the Mongolian Productivity Organisation and author of ‘NFT: From Zero to Hero’ told Capital.com that GST being built on the Solana network is both a “risk and opportunity” for the token.

“More than $700m has exited Solana-based applications, a 70% drop from the $1bn in TVL on 2 November alone. And please be mindful that this is the beginning of the whole saga.

“If Solana can continue to function and ride through this massive blow, GST being one of the largest ecosystems on Solana would surely be the first few that will benefit from this; Proving to the world that decentralisation actually works this time.”

Crypto advisor Victoria Kennedy added that GST’s biggest pro is its current burn system, which sees more tokens being burned than released, thus keeping the green satoshi token cryptocurrency deflationary. However, she also noted that due to its massive use function within the STEPN ecosystem, the “selling pressure from the players is much bigger, thus pushing the price down”.

Dr Pooja Lekhi, the vice chair of the Department of Quantitative Studies at University Canada West said that the GST coin “is still very new in the crypto market and hence has a limited track record and has no traceable features on trading views”.

On the other hand, Dr. Lekhi noted that GST has certain unique features including “social and community aspects”.

“With Game-Fi, STEPN aims to encourage people toward a healthier lifestyle, combat climate change and connect the public to Web 3.0, which is the next version of the internet. The GST token can be used to purchase Carbon Removal Credits and has received support from top-notch crypto investors, crypto firms, and big businesses.”

Note that analyst views are not financial advice and shouldn’t be used as a substitute for your own research. Always conduct your own due diligence, and never invest or trade money you cannot afford to lose.

 

Source: https://capital.com/green-satoshi-token-gst-stepn-crypto-what-is-ultimate-guide

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j