HashKey Hong Kong, the first licensed virtual asset provider in the city, has announced that it will open its doors for retail trading on August 28. However, there will be limitations on investments, with users only allowed to invest up to 30% of their net worth in cryptocurrencies. If this limit is exceeded, a risk control warning will be displayed. Xiaoqi Weng, the chief operating officer of HashKey, explained that the exchange cannot validate users’ net worth and therefore relies on self-verification of assets. The exchange will also assess users’ investment background during the Know Your Customer verification process. Initially, HashKey Hong Kong will only allow trading of Bitcoin (BTC) and Ether (ETH). The Hong Kong Securities and Futures Commission has not yet approved margin trading or trading of crypto derivatives on regulated exchanges, Weng added.
China has recently intensified its crackdown on private blockchain firms, aiming to eliminate them regardless of the consequences. The government is particularly concerned about the use of cryptocurrencies for capital flight during times of economic downturn. Reports indicate that blockchain projects in China, whether legitimate or not, are being targeted. Third-party tracking firms are providing information to the police, which can lead to arrests and asset forfeitures. These tracking firms stand to earn huge commissions, ranging from millions to hundreds of millions of dollars, depending on the scale of the project. In one recent case, Chinese police seized $55 billion in a money laundering operation related to cryptocurrencies. After arrest, crypto executives are allegedly coerced into handing over their project’s private keys and server access. Police then use third-party payment processors to sell the coins and tokens, receiving Chinese yuan in exchange. The executives are charged with operating illegal schemes such as multilevel marketing or money laundering, resulting in the seizure of protocol-related assets. It is believed that law enforcement agencies benefit financially from these operations. This crackdown has led to the termination of several protocols, leaving non-Chinese users with limited recourse to recover their funds. Many Chinese Web3 founders have emigrated, and foreign law enforcement agencies are attempting to retrieve the stranded funds.
Despite the crackdown on private crypto activities, China’s government-led blockchain initiatives are thriving. On August 18, the first digital yuan central bank digital currency (CBDC) green bond was issued for $14 million. The funds will be used to finance a solar panel facility expansion project in Wuxi. The digital yuan has been promoted this year as a tool to stimulate domestic spending during the country’s financial crisis. In Tianjin alone, digital yuan transaction volumes exceeded $17.5 billion in the first half of the year, with over 302,000 merchants accepting the CBDC as a payment method.
In other news, the U.S. Federal Bureau of Investigation (FBI) has identified 1,580 BTC (worth $41 million) stolen by North Korean hackers. The stolen funds include those from the Alphapo hack ($60 million), CoinsPaid hack ($37 million), and Atomic Wallet hack ($100 million). The FBI believes that North Korea will attempt to cash out these funds. Investigations into North Korean hackers’ involvement in previous exploits are still ongoing.
Finally, a former Chinese political official, Yi Xiao, has been sentenced to life in prison for corruption and abuse of power in a Bitcoin mining enterprise. Xiao ran a Bitcoin mining company and amassed over 160,000 Bitcoin miners, accounting for 10% of the electricity consumption in the city of Fuzhou. He used his position to secure subsidies, capital, and electricity supply for his company and fabricated reports to conceal the true nature of the operation. China has been cracking down on crypto activities this year due to concerns over data theft and money laundering.
Source link
