Amid the banking crisis and SEC crackdown, crypto-friendly regions that could benefit the most include:
European Union (EU)
Despite facing an economic downturn, the European Union is still the first region to adopt a comprehensive regulatory framework on digital assets. This market accounts for about 14% of global trade, along with China and the US as the top three markets according to Eurostat.
MiCA, the EU Crypto Asset Market regulation, is expected to come into force from June to December 2024. MiCA’s clarity prompted Ripple CEO, Brad Garlinghouse, to select Europe as a region that “significantly benefits if cryptocurrencies leave the US”.
Paul Grewal, Coinbase’s chief legal officer, shares a similar view and sees the crackdown on crypto in the United States as an “incredible opportunity” for Ireland and Europe.
Hong Kong
While China has repeatedly imposed a ban on cryptocurrencies, Hong Kong is open to the sector and encourages the participation of investors and founders in the industry.
Hong Kong aims to become a crypto hub by recognizing cryptocurrencies as property and establishing more regulations for the industry.
Virtual asset service providers (VASPs) in Hong Kong must prevent retail transactions from China. Tokens on an exchange must be highly liquid, meet two key metrics, and have one year of trading activity. In addition to the basic requirements, VASPs must segregate customer assets, apply exposure limits, comply with network security standards, and avoid conflicts of interest.
The Securities and Futures Ordinance (Category 7) also opens up strong growth potential for the DeFi space, where tokens can be viewed as futures or securities. With the new mode, many exchanges such as CoinEx, Huobi, OKX, Gate.io, BitMEX quickly applied for a new HK VASP license.
Singapore
Singapore soon became a crypto hub, accelerating crypto adoption in the Asia-Pacific region.
Initially, the Monetary Authority of Singapore (MAS) considered cryptocurrencies an “intangible asset” and could be used to pay for goods and services. After that, cryptocurrency trading is recognized as a commodity exchange.
Unlike Hong Kong, Singapore is tax free for three years for start-ups. This is useful for new businesses that need help building credit and have limited funding opportunities.
With financial and social stability, Singapore has become a hotbed of crypto capital.
In particular, Singapore has recently focused on developing machine learning and artificial intelligence technologies, with the goal of using technology to change the way it operates. Therefore, Singapore could become an attractive destination for new crypto projects.
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