JPEX

<![CDATA[<figure class="image"><img src="https://cimg.co/news/125973/332629/adobestock-f11photo-1.jpeg" alt="" srcset="https://cimg.co/news/125973/332629/responsive-images/adobestock-f11photo-1___media_library_original_3500_2337.jpeg 3500w, https://cimg.co/news/125973/332629/responsive-images/adobestock-f11photo-1___media_library_original_1200_801.jpeg 1200w, https://cimg.co/news/125973/332629/responsive-images/adobestock-f11photo-1___media_library_original_900_601.jpeg 900w, https://cimg.co/news/125973/332629/responsive-images/adobestock-f11photo-1___media_library_original_720_481.jpeg 720w, https://cimg.co/news/125973/332629/responsive-images/adobestock-f11photo-1___media_library_original_600_401.jpeg 600w, https://cimg.co/news/125973/332629/responsive-images/adobestock-f11photo-1___media_library_original_300_200.jpeg 300w" sizes="100vw" width="3500" class="content-img"><figcaption>Source: AdobeStock / f11photo</figcaption></figure>Although Eastern Asia - once a top market - has seen a decline in crypto activity over the past several years, <a href="https://cryptonews.com/news/hong-kong-lawmaker-addresses-vitalik-buterins-concerns-on-citys-crypto-friendliness.htm">Hong Kong</a> may provide the region with "a potential tailwind," <a href="https://www.chainalysis.com/blog/eastern-asia-cryptocurrency-adoption/">according</a> to research firm <a href="https://cryptonews.com/news/chainalysis-lays-off-another-150-employees-amid-ongoing-market-downturn.htm">Chainalysis</a>.While Hong Kong is rising as a global leader in the regulated digital asset market, it's still unclear what it means for <a href="https://cryptonews.com/news/china-uses-digital-yuan-recycle-gold-pay-land-registry-fees.htm">China</a> as a whole - though it may signal an "evolution" in Beijing's stance towards the industry.<h2 id="the-region-s-decline">The Region's Decline</h2>Eastern Asia is the fifth most active crypto market, per Chainalysis, accounting for 8.8% of global crypto activity between July 2022 and June 2023."Eastern Asia&rsquo;s decline in cryptocurrency activity over the last few years has been notable," the firm said. As recently as 2019, it was a top crypto market by transaction volume, "largely powered by China&rsquo;s huge trading activity and mining sector."&nbsp;<figure class="image"><img src="https://cimg.co/news/125973/332617/screenshot-2023-10-04-181305.jpg" alt="" srcset="https://cimg.co/news/125973/332617/responsive-images/screenshot-2023-10-04-181305___media_library_original_805_371.jpg 805w, https://cimg.co/news/125973/332617/responsive-images/screenshot-2023-10-04-181305___media_library_original_720_332.jpg 720w, https://cimg.co/news/125973/332617/responsive-images/screenshot-2023-10-04-181305___media_library_original_600_277.jpg 600w, https://cimg.co/news/125973/332617/responsive-images/screenshot-2023-10-04-181305___media_library_original_300_138.jpg 300w" sizes="100vw" width="805" class="content-img"><figcaption>Source: chainalysis.com/blog/eastern-asia-cryptocurrency-adoption/</figcaption></figure>But the value of crypto transactions across China dropped as Beijing continued its crackdown on digital assets.That said, Chainalysis argued that,<blockquote>"A potential tailwind for East Asia comes from Hong Kong, where several crypto initiatives and industry-friendly regulations launched over the past year have fostered bubbling optimism."&nbsp;</blockquote>These developments have led to speculations that Beijing may be (re)warming up to crypto and that Hong Kong may be a testing ground for China's crypto efforts.&nbsp;Founder of Hong Kong-based OTC firm OSL Digital Securities, Dave Chapman, told Chainlaysis that,<blockquote>&ldquo;The promotion of Hong Kong as a potential crypto hub is not necessarily indicative of the Chinese government&rsquo;s stance on crypto. However, we are seeing a number of Chinese state-backed entities indirectly supporting Hong Kong&rsquo;s Web3 ventures, and this could be viewed as an exploratory approach to understanding digital assets without loosening mainland policies."</blockquote>Hong Kong is "an extremely active crypto market" by raw transaction volume, receiving $64 billion in crypto in a year - close to mainland China's $86.4 billion, despite the former having a population 0.5% the size of the latter.Most of this comes from Hong Kong&rsquo;s "highly active" over-the-counter (<a href="https://cryptonews.com/news/south-korean-regulators-eye-otc-crypto-regulation.htm">OTC</a>) market, said the report.&nbsp;<h2 id="hong-kong-attracting-foreign-users">Hong Kong Attracting Foreign Users</h2>Founder of Hong Kong-based OTC firm CryptoHK, Merton Lam, said that his company has many foreign users interested in moving wealth away from unstable economies or strict capital controls.<blockquote>"Anecdotally, I hear from other crypto exchanges that many Russians and Ukrainians are coming to Hong Kong to get their money to safety using crypto. These aren&rsquo;t multimillionaires either &mdash; ordinary people are doing this too."</blockquote>International payments are another use case in the region, Merton Lam pointed out: for example, it's much easier for businesses to pay a supplier via stablecoins than banks.____<h3 id="learn-more">Learn more:&nbsp;</h3>- <a href="https://cryptonews.com/news/hong-kong-reveal-list-of-crypto-license-applicants-wake-of-jpex-scandal.htm">Hong Kong to Reveal List of Crypto License Applicants in the Wake of JPEX Scandal</a> - <a href="https://cryptonews.com/news/hong-kong-aims-thrive-as-an-international-crypto-hub-despite-global-scrutiny.htm">Hong Kong Aims to Thrive as an International Crypto Hub Despite Global Scrutiny</a> - <a href="https://cryptonews.com/news/new-report-despite-crypto-ban-chinese-citizens-trade-binance-ftx-exchanges.htm">Despite Crypto Ban, Chinese Citizens Trade on Binance and FTX Exchanges</a> - <a href="https://cryptonews.com/news/chainalysis-report-india-ranks-second-global-transaction-volume-despite-tax-law-challenges.htm">India Ranks Second in Global Transaction Volume Despite Tax Law Challenges</a>
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Hong Kong Emerging as Crypto Hub Amid East Asia's Regulatory Challenges - Is China Reversing Course?

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