Mt Gox hasn’t dropped Bitcoin yet, Hong Kong has launched a crypto exchange: Asia Express

East Asia's weekly news roundup reviews the industry's most important developments.

Matt Gox doesn't sell Bitcoin right away.

Mark Karpeles, former CEO of Japanese crypto exchange Mt Gox, says the company will not yet dispose of its Bitcoin stake to pay creditors: “As far as I know, everything is fine with Mt Gox. The trustee is moving coins to another wallet in preparation for a possible distribution later this year. The sale of Bitcoins that is happening is not imminent,” Karpeles wrote.

Neil Rorty, an analyst at investment platform Stocklytics, told Cointelegraph that any flash sale by MT Gox could upset the current supply and demand dynamics.

The more than 100,000 bitcoins that Mt.Gox trustees will soon release on the market could tip the scales.

Remember, there are currently less than 20 million bitcoins, but a third of those haven't been traded in over five years. One more part is believed to be lost forever; It can be two to six million Bitcoin. Suddenly, 100,000 people seem like little more than a drop in the ocean.

Matt Gox was the world's largest bitcoin exchange when it filed for bankruptcy in 2014 after discovering that 850,000 of its customers' bitcoins (BTC) had been stolen after years of undercover phone calls. The exchange has since recovered to 200,000 BTC.

The money is held in trust for creditors, 162,106 BTC ($11.38 billion) is deposited in Token Unlock in several wallet addresses. Creditors will be paid off later this year in a ten-year bankruptcy proceeding.

Hong Kong regulators will suspend all unlicensed exchanges until June 1

Hong Kong's Securities and Futures Commission (SFC) will require all unauthorized virtual asset trading platforms (VATPs) to leave the city from next month.

“All VATPs operating in Hong Kong must be licensed by the SFC or “deemed licensed” VATP applicants under the AMLO.

It is a crime to operate VATP in Hong Kong in violation of AMLO. [Anti-Money Laundering and Counter-Terrorist Financing Ordinance]And the SFC will take appropriate action against any violation of the law,” it said.

More than 22 cryptocurrency exchanges, including Gate.io and OKX, have sought approval to maintain their presence in the region for a one-year registration grace period. However, most of these exchanges eventually decided to withdraw their applications before the deadline.

Despite the implementation of the VATP licensing system since last June, Hashkey and OSL Group remain the only crypto exchanges approved by Hong Kong regulators. Among many requirements, exchange applicants are required to submit audited financial returns, use certified custodians for consumer deposits and obtain insurance. Some exchanges have folded due to regulatory pressure in the past.

Hong Kong is a major contributor to China's digital economy.

Despite the country's ongoing ban on bitcoin, Chen Chun, a professor at the state-affiliated Chinese Academy of Engineering's School of Computer Science and Technology, hailed Hong Kong as a “sandbox” for Web3 development and mainland China's digital economy.

“Hong Kong should use the technical features of Web 3.0 to create transparency, increase productivity growth, and make use of spatial boundaries to make the development of disaster prevention clear,” Chun said. Effort

“Based on blockchain's immutability potential, it can build a fair, just and reliable data network by allowing the data itself to generate higher value, such as protecting the rights of internal participants outside the platform.”

Chun said it was important to create a digital currency that could handle the complexities of the Web3 network, and urged Hong Kong regulators to focus on providing $26 million to $260 million in funding for the central bank's digital currency.

In February, Hong Kong allocated $383 million to a Cyberport initiative that aims to attract Web3, blockchain and AI firms to the East Asian city. Hong Kong's Finance Secretary Paul Chan has revealed that the city's AI supercomputing center will begin operations this year. In the year By early 2026, it is expected to have 3,000 petaflops of computing power capable of processing nearly 10 billion images per hour.

Huobi's co-founder's investment firm returned 108% of the deposit from FTX's collapse

Hong Kong crypto investment firm Sinohope has acquired more than 100% stake in bankrupt crypto exchange FTX, co-founder of crypto exchange Hubei Global (now HTX), created by Leon Li.

Sinohope through its subsidiary Hbit Ltd sold its FTX digital asset claims for $18 million to Delaware-based debt investment firm Ceratosaurus Investors LLC for $19.5 million, representing a 108% recovery on its initial deposit.

Currently, FTX claims are trading between $1.29 and $1.43 per dollar, largely due to the sharp increase in the value of digital assets since FTX filed for bankruptcy in November 2022.

The move is by all measures, a happy ending to Sinhope's woes. Because of the FTX contagion, Leon Li had to personally extend a $14 million personal line of credit to bail out customers affected by the FTX contagion. On December 13, 2023, the company announced that it expects a loss of HK$280 million ($35.86 million) in the first nine months of the year, including HK$86 million ($11 million) in non-performing enterprise deposits.

Binance is reportedly selling Gopax lending claims at a steep discount.

Crypto exchange Binance, which last year bought a majority stake in Gopax, a top five Korean crypto exchange by market share, has reportedly sold assets of Gopax users to bankrupt crypto investment firm Genesis Global for less than half their fair value in August 2023.

According to the Korea Economic Daily, Gopax initially owed 70 billion won ($50.9 million) to its users. However, after paying users 35 billion won ($25.5 million) through the sale of creditor claims, the remaining balance of 35 billion won ($25.5 million) has increased from $100 billion ($72.7 million) due to the appreciation of crypto assets since Genesis. Declared bankruptcy in 2022.

In March, The Korea Times reported that Gopax is currently in a “completely capital-impaired state” due to mounting debt. Earlier this month, Genesis secured a $3-billion settlement in US bankruptcy courts to return cash and cryptocurrency to remaining creditors.

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Zhiyuan Sun

Zhyuan Sun is a reporter at Cointelegraph, focusing on technology-related news. He has several years of experience writing for major financial media outlets such as The Motley Fool, Nasdaq.com and Seeking Alpha.