Crypto in Asia: Top developments for 2021

[Karl_BC]

Hello, crypto fans

When it comes to taking the lead in cryptocurrency development and adoption, no region does it better than Asia. Ever since the creation of Bitcoin, developed Asian countries such as Japan and South Korea have placed their bets in the crypto market and now, their decisions are paying off.

2020 has been catastrophic for nearly all sectors of the economy but one that has continued to perform impressively is the cryptocurrency industry. Breaching the US$15,000 mark, Bitcoin has been bullish since its historic drop on March 12, 2020, now known as ‘Black Friday’. It hasn’t stopped climbing the chart since it dropped to nearly US$3,000 in the first quarter of 2020.

Asian countries have played a major role in this advancement with the majority of exchange sites processing crypto transactions based in the world’s far eastern region. Governments also played an active role in regulating digital assets, making them safe and secure before their citizens can utilize them. But the biggest group to join the crypto craze are institutional investors and even banks such as Singapore’s DBS Bank.

Now that the year is closing, it’s time to look back at the biggest crypto developments that occured in Asia and anticipate what’s next for 2021.

Asia-Pacific: Biggest adopters of crypto technology

When it comes to technological innovation, development and early adoption, the Asia Pacific stands out among the rest. Even before the 2017 crypto boom, a lot of people from Japan and South Korea have already been involved in the crypto craze and in 2018, both countries led the pack in global trading.

Japan: First in line

In Japan, cryptocurrency exchanges such as bitFlyer and Bitfinex are registered as financial service institutions, officially recognized by the government and widely trusted by the people. Mt. Gox, once the world’s largest and leading bitcoin exchange, was founded just a year after Bitcoin’s inception. The Shibuya-based exchange site handled over 70% of all Bitcoin transactions in 2013 and 2014 until it announced bankruptcy in 2014 after the majority of its Bitcoin were reportedly stolen.

Since then, different local exchange sites have been founded in Japan including Okcoin Bitbank, Bitpoint Japan and Huobi Japan. Other notable exchange sites include Bitfinex and bitFlyer. Though based in Hongkong, Bitfinex is one of the most used sites in Japan with its advanced trading platform. Founded in 2012, it strongly remains one of the most trusted exchange sites not just in Japan but the world. Founded in 2014, BitFlyer is currently the country’s biggest Bitcoin broker and exchange site. Today, over 3.5 million Japanese are utilizing crypto trading, making up a large portion of the world’s crypto community.

China: Bitcoin Mining giant

In terms of mining, China leads the competition even though it has had a rocky relationship with cryptocurrencies in terms of regulations and trading. According to a report published by the Beijing Arbitration Commission (BAC), there are currently no laws recognizing Bitcoin as currency or virtual property that’s why it cannot be used in completing transactions where it is used as currency. But if it is used otherwise, as a general property for example, the transaction is legal.

While trading cryptocurrencies in China is banned, mining certainly isn’t. It has long been a profitable business in China because of the cheap electrical costs making it a mining haven for miners. Most crypto hubs are located in Yunnan, Xinjiang and Sichuan provinces in China which accounts for 70% of the total mining power done for Bitcoin.

Korea: Quick and smart adoption

When it comes to quick institutional adoption, no one does it better than Korea. Private corporations are quick to recognize the advantages brought by cryptocurrencies. Big telecommunication companies such as Kakao have integrated crypto in their services, allowing millions of their users to complete transactions using cryptocurrency.

Even mobile applications such as the country’s widely used hotel booking platform, Yeogi Eottae, is working with exchange sites so their clients can utilize their services with crypto.

Recent developments

The world is witnessing a massive cryptocurrency adoption in today’s unforeseen landscape. With trusted institutions backing Bitcoin and blockchain technology, it’s clear that cryptocurrency is here to stay.

Different companies, banks and governments in Asia are starting to realize the potential of cryptocurrencies and the technology that comes with them, spurring developments, regulations and bills to make them available for the mass majority of people. Here’s some of the latest news and developments happening in the Asian crypto space.

Singapore’s largest bank plans to launch DBS Digital Exchange

As private companies welcome and move forward with cryptocurrencies, so do banks in progressive countries such as Singapore. The developed Southeast Asian country is quick to follow the footsteps of Japan and South Korea in terms of cryptocurrency adoption.
Recently, DBS, the country’s largest bank, announced that it will launch Singapore’s first bank-backed digital exchange. Known as the DBS Digital Exchange, the platform will allow trading and exchanges of top crypto coins including Bitcoin (BTC), Ether (ETH), Ripple (XRP) and Bitcoin Cash (BTCH) with fiat currencies including Singapore dollar, US dollar, Hong Kong dollar and Japanese yen.

It will be directed by the Monetary Authority of Singapore (MAS) with the aim to create an ecosystem of payment solutions that is beneficial to private markets. Analysts view this as an opportunity to boost institutional adoption and since the site is backed by a bank, it will reach a wide user base.

Singapore is a robust tech-focused country that is steadfast in its dedication to developing blockchain technology and incorporating crypto into the mainstream. Strict regulations for exchange sites protect users and their funds from fraudulent operations. But lawmakers didn’t have an iron fist when it came to regulations. Big-time exchange sites from other countries such as Binance and Coinbase were given temporary exemptions from holding licences so their users can still use their trading services. This strict yet flexible approach makes Singapore the perfect country for blockchain and crypto innovation.

Blockchain development hub

Singapore is also a haven for new blockchain companies and those who want to launch their own ICO. In 2018, the Southeast Asian country is ranked second as the most popular country for ICOs and currently, almost 240 companies on blockchain technology are based in Singapore.

Crypto in Southeast Asia

Philippine lawmaker pushes for blockchain development in the country

Singapore may be the leading Southeast Asian country when it comes to technological advancements, but its ASEAN neighbours are quick to adapt. Just recently, a Philippine lawmaker proposed a bill that will make blockchain development a priority in the country’s technological and financial industries.

In October, Albay Rep. Joey Salceda introduced House Bill (HB) 7864 or the Blockchain Technology Development Act to the House of Representatives, saying that blockchain technology can be used by public and private sectors to provide cheaper and more secure services.  He mentioned that it is a perfect tool for national programs, adding that ‘Blockchain can be applied across so many areas in both the public and private sectors.’ Salceda adds that the country has an untapped market of consumers and labour force that can be trained to become skilled workers in the field. ‘I want us to grab the opportunity to be a hub for this development.’

Before the Blockchain Technology Development Act, there hasn’t been any concrete action from the Philippine government when it comes to cryptocurrency regulations and laws on blockchain technology.

Malaysia approves crypto exchange sites and traffic increases dramatically

Amidst a country-wide lockdown during the second quarter of the year, Malaysian crypto exchange sites have reported a dramatic increase in traffic. Since the country’s Securities Commission has given full approval to four crypto exchange sites to legally operate, interest in cryptocurrencies have skyrocketed.

The increasing number of new member registrations can be attributed partly to the coronavirus situation as well. Since the WHO announced COVID-19 as a pandemic, governments have put their nations in lockdown, causing businesses to halt, stock markets to drop and economies to tank. This gave people an opportunity to think of alternative investments that wouldn't rely on centralization. And with active approval from the authorities, this optimistic attitude from the public can bring forth a profit-generating crypto industry.

India’s crypto industry flourishes after the two-year ban on crypto exchanges just last March 2020

In South Asia, things are looking brighter as the Indian government recently lifted the ban on cryptocurrency. The Supreme Court has finally removed the two-year ban on cryptocurrency exchanges in March 2020, spurring a rebirth in the Indian crypto market.

Apifiny, a New York-based cryptocurrency liquidity and solutions provider, reported that global exchanges noted a five to 10 times increase in traffic coming from Indian users. Meanwhile, local exchange sites reported a dramatic increase in new registrations in 2020, a record 2.5 times higher than the global average.

These numbers can only mean that India has a large number of crypto enthusiasts, making it a conducive space for development and further advancement. While regulations remain unclear, institutions are joining in on the Indian crypto market by investing in large quantities and integrating crypto trading in their services.

Last July saw the beginning of Quartz Smart Solution, a financial institution that offers crypto trading services launched by an Indian multinational information technology and consulting firm, Tata Consultancy Services. With their large customer base, this institutional adoption can bring more big-time players to adopt crypto and invest the way Singapore’s DBS has.

Asia continues to lead the world’s crypto revolution heading into 2021

Though China keeps a tight leash on cryptocurrency to protect their native currency, other Asian countries such as Japan and South Korea have managed to foster a conducive environment for crypto-related business all the while regulating their activities.

But even with China’s efforts, national interest in cryptocurrencies hasn’t stopped. Bitcoin mining remains strong and China-based exchange sites managed to remain afloat by escaping to more crypto-friendly countries such as Singapore.

This only proves that with the right mix of government regulation and public participation, cryptocurrency can bring forth a new era of development. Asian governments that are bullish toward crypto and the technology can look forward to a bright future. With the advancement of financial technology comes the next world-changing revolution.


You are welcome to share your thoughts.

Thanks,
Karl

[TomPluz]

While the biggest Asian markets (India and China) for cryptocurrency are not totally open for now (though immense activities related to cryptocurrency are still taking place in these 2 countries), we know that in countries like Japan, South Korea, Singapore and other lesser-known entities the market is booming fantastic. In fact, many are saying that the future of crypto is really in Asia as more and more people are starting to accept and become a part of this big financial revolution. At the same time, scams are happening all over with PlusToken in China emerged as the biggest crypto-related one. This and more are the pains of growth that many people encountered and experienced.