Bank of China Hong Kong Completes Digital RMB Sandbox Trial

Bank of China Hong Kong (2388) announces that the second phase of its digital Renminbi (e-CNY) priority experience events, staged in collaboration with Bank of China’s mainland branches, was a success. This follows the Hong Kong Monetary Authority’s clearance at the end of last year for the bank to begin the digital RMB sandbox trial. Digital Renminbi is the Chinese version of CBDC.

Qualified clients who took part in the experiment were able to see real-world applications of the digital RMB. Customers may top up their digital RMB wallets using the Bank of China Hong Kong mobile banking app and spend the digital money at a variety of businesses in both mainland China and Hong Kong.

Customers predominantly used the digital RMB for offline transactions on the mainland during the event, notably for tiny, high-frequency purchases covering everyday food and drink, transportation, and retail purchasing. The bank also supplied local retailers accepting digital RMB with acquiring and Hong Kong dollar clearing services, certifying the usage of digital RMB for consumption in Hong Kong.

Bank of China Hong Kong says it will once again partner with Bank of China’s mainland branches to launch the first-ever “Cross-border Shopping Festival” in Hong Kong, which will include the digital RMB. Selected clients will get digital RMB red packets for consumption, giving them personal experience with the convenience of digital RMB cross-border payments.

Deputy General Manager of Bank of China Hong Kong’s Digital Currency Special Task Group, submitted a digital RMB sandbox test report to the Hong Kong Monetary Authority. The group plans to refine the product package based on feedback from merchants and customers. The focus is on streamlining the customer journey from application to wallet activation, improving the customer experience, and promoting merchant acceptance of digital RMB. This will enable mainland tourists to use digital RMB for payments in Hong Kong, save merchants on funds clearing costs, and strengthen Bank of China Hong Kong’s cross-border financial services.


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Bitcoin Leads Bullish Trend with $125M Inflows in Overall Crypto Market

CoinShares reports a significant increase in investor bullishness towards digital assets, with a total inflow of $125 million in the past week. In the last fortnight, inflows totaled $334 million, representing nearly 1% of the total assets under management (AuM).

Bitcoin remains the primary choice for investors, with a massive $123 million inflow over the past week. Bitcoin investment products have bounced back to a net inflow year-to-date, overturning a net outflow position of $171 million just two weeks prior. Despite the recent uptick in price, short-Bitcoin investment products experienced a tenth consecutive week of outflows, now representing 59% of AuM.

However, short-Bitcoin remains the second-best-performing asset in terms of year-to-date inflows, with $60 million. As for altcoins, Ethereum leads the pack with inflows totaling $2.7 million, followed closely by Cardano, Polygon, and XRP. Multi-asset and Solana experienced minor outflows of $1.8 million and $0.8 million, respectively. Blockchain equities have also seen a resurgence, with inflows of $6.8 million following a 9-week streak of outflows.

The surge in digital asset investment and blockchain equities indicates growing investor confidence in the crypto industry.

The total AuM reached $37 billion during the week, matching the highest level since early June 2022 and the average AuM for 2022. Trading activity remains robust, with a weekly volume of $2.3 billion, substantially higher than the year-to-date average of $1.5 billion.


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Gemini Co-founder Marks Spot Bitcoin ETF Approval Struggle for A Decade

The 10-year anniversary of the day that Cameron Winklevoss and his brother Tyler filed for the top slot in the first Bitcoin Exchange-Traded Fund (ETF) was celebrated today by the co-founder of the cryptocurrency exchange Gemini. The businessman took the opportunity to lambast the Securities and Exchange Commission (SEC) of the United States for its ongoing refusal to approve such items. He claimed that this hesitation has proven to be harmful to American investors.

The Winklevoss brothers think that the SEC’s efforts have harmed investors more than they have helped them, especially by preventing them from investing in Bitcoin, the asset that has performed the best over the previous ten years.

The SEC’s opposition to approving Bitcoin ETFs, according to Cameron Winklevoss, has instead led investors to “toxic products” like the Grayscale Bitcoin Trust (GBTC). He emphasised the problems with GBTC, such as the enormous discount to Net Asset Value (NAV) and the extremely high fees.

Furthermore, he emphasised how this regulatory impasse has prompted spot Bitcoin activity to move overseas. Winklevoss claims that as a result, dangers for investors have increased because they are now dealing with unregistered and unregulated venues.

One significant result highlighted by Winklevoss was the fact that investors are now turning to platforms like FTX as a result of the SEC’s denial. He argues that because of this, they have been the victims of one of the biggest financial frauds in contemporary history.

Winklevoss urged the SEC to consider its record in a call to action. He advised the SEC to concentrate on carrying out its mandate rather than exceeding its statutory authority and serving as an economic life gatekeeper. This includes promoting fair and orderly markets, protecting investors, and assisting with capital development.

His concluding remarks showed his support for those who are still fighting for U.S. spot Bitcoin ETFs. It is evident that the Winklevoss brothers are still dedicated to their goal despite their ten-year battle, indicating a continuing difficulty for regulators. 


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Thailand’s SEC enhances investor protection with new cryptocurrency trading rules.

Thailand’s Securities and Exchange Commission (SEC) has introduced new guidelines to strengthen investor protection in the cryptocurrency industry. The SEC has mandated clearer disclosure of risk warnings and restrictions on digital asset business operators’ deposit and lending services.

The rules, endorsed during meetings in September, December of 2022, as well as May of 2023, require cryptocurrency business operators to explicitly inform potential investors about the inherent risks involved in trading. Customers must acknowledge these risks and provide consent before commencing trading, following an investment suitability assessment and appropriate investment proportions.

The second part of the new regulations prohibits digital asset business operators from providing or supporting deposit taking and lending services, with certain exceptions. These rules will take effect on August 30, 2023, and prohibit offering returns on digital asset deposits unless it falls under promotional activities defined by the SEC.

Additionally, the regulations prohibit any actions aimed at persuading or advertising deposit taking and lending services to the general public, including those provided by other entities.


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Hong Kong IFEC Warns Against Trading on Illegal and Foreign Platforms for Virtual Assets

The investor and Financial Education Council (IFEC), a public organisation under the Securities and Futures Commission (SFC), has issued a warning regarding the potential risks connected to unlicensed and foreign virtual asset trading platforms. In reaction to the growing acceptance of virtual assets, which, despite their attraction, present a high-risk investing opportunity, this advise has been offered.

The SFC has yet to authorise any platforms that can provide services to retail investors after the new regulatory framework for virtual asset trading platforms goes into effect on 1 June 2023. Investors are advised to remain cautious of the inherent dangers by IFEC, which emphasises that the bulk of these platforms that are now accessible to the public are still unregulated by the SFC.

Investors may be exposed while trading on unregulated sites. Investors may not be protected from potential dangers by such platforms’ lack of operational transparency and defined procedures. Many platforms, according to IFEC, have disclaimers that release them from liability even if they misplace investors’ virtual assets.

The IFEC also clarified potential problems brought on by disagreements between investors and platforms. Investor complaints might have few options if there is no regulatory scrutiny. Furthermore, it’s possible that the SFC won’t be able to help. The IFEC stressed that instances of fraud, security lapses, theft, or an abrupt halt to operations could result in the complete loss of virtual assets held on these platforms.

Although they might be registered or licenced with foreign regulators, offshore platforms can carry hazards. Investor protection may be compromised by some governments’ inadequate regulatory practises. Furthermore, because of their cross-border character, seeking out complaints or support abroad can be difficult. Investors may face an uphill struggle to make claims and seek legal redress if such platforms close or cease operations, the IFEC cautioned. Furthermore, local law enforcement and authorities might not be able to help if these sites have no relationship to Hong Kong.

The Hong Kong Special Administrative Region (HKSAR) needs more financial literacy, which the IFEC has long pushed for. It seeks to shield clients from the dangers of unregulated virtual asset trading platforms through this guidance, assisting them in making more knowledgeable and secure investment decisions.


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