🌴Coinbase goes to Bermuda, 🚦Russia's Crypto Green Light, 🚀Africa Blockchain Funding Skyrockets

April 22, 2023

Your 5 minute emerging market web3 weekly update

In This Issue

Latin America and the Caribbean
🔸Coinbase Expands to Bermuda as SEC Pressure Mounts
🔸Binance Faces Financial Crime Probe in Brazil

Eastern Europe
🔸Russia’s Central Bank Greenlights Cryptocurrency in Foreign Settlements Experiment
🔸Ukrainian Regulators to Adopt EU's Cryptocurrency Regulations

Africa
🔸African Blockchain Funding Skyrockets With 5x Increase in 2022
🔸Celo's Africa DAO Launches with Overwhelming Community Support

Asia
🔸Cryptocurrencies Recognized as Property in Hong Kong Court Ruling
🔸Citi India Completes First Blockchain-Powered Letter of Credit Transaction on Contour

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Latin America and the Caribbean

Image Credit: Richard Masquelier via Unsplash, United Kingdom Government via Wikimedia Commons, Coinbase

Coinbase has been granted a Class F license by the Bermuda Monetary Authority to operate in the offshore financial haven that will allow Coinbase to carry out a range of digital asset-related services, including issuing, selling, or redeeming digital assets. The exchange is also reportedly seeking to establish an offshore derivatives exchange in Bermuda that will offer perpetual swaps and other crypto derivatives that are inaccessible in the US due to tight regulatory restrictions. The move is seen as part of Coinbase's attempt to challenge existing rivals such as Binance and diversify its business outside the US amid mounting pressure at home from the SEC.

Brazilian authorities are investigating Binance for alleged financial crimes related to the company's offering of cryptocurrency derivatives to its Brazilian customers after a "stop order" by the Securities and Exchange Commission (CVM). The investigation followed a communication from the CVM to the Attorney General of São Paulo stating that Binance may have committed financial crimes by continuing to offer the derivatives. The CVM pointed out that Binance's customer service support had recommended changing the language of the site to access Binance Futures, which is not available in Portuguese.

Eastern Europe

Image Credit: Kremlin via Wikimedia Commons

The Central Bank of Russia has allowed cryptocurrency to be used in external settlements as part of an experiment, according to the bank's head, Elvira Nabiullina. She stated that cryptocurrency should not be used within the country, but that external settlements would be possible under an experimental legal regime. The Bank of Russia plans to establish special authorized organizations for mining and settlements with foreign economic activity partners, and discussions are underway with the government on which organizations will be involved.

Ukraine is set to adopt the Markets in Crypto-Assets (MiCA) regulation, following the European Parliament's passing of the legislation. The Deputy Chairman of the Tax Committee of Ukraine, Yaroslav Zheleznyak, has said that he and his colleagues are already working to implement provisions of MiCA to legalize crypto assets in the country. MiCA, which aims to introduce uniform regulations and standardized rules for crypto assets across the EU, is expected to enhance the competitiveness of startups in the EU and lead to a rise in their market share compared to unregulated competitors.

Africa

Image Credit: Burak The Weekender via Pexels

Blockchain venture funding in Africa has soared from $89.6 million in 2021 to $474 million in 2022, a five-fold increase, according to the 2022 African Blockchain Report. The Seychelles and South Africa accounted for 81% of African blockchain venture funding in 2022, and the continent's annual funding growth was 759% higher than Asia, the second-best performer. Africa was also the only region to have an increase in median deal size, which grew by 58% and reached $1.5 million.

Celo has launched a regional DAO to increase the adoption of its blockchain technology in grassroots communities across Africa. The proposal to establish the community DAO for Africa received over 65 million CELO tokens in community voting, requesting a budget of $428,000 worth of CELO from the community fund to cover activities in five countries. The DAO has three focus areas: attracting Web3 talent locally, community education and university outreach, and building market awareness and brand positioning through events and sponsorships.

Asia

Image Credit: Jeremy Bezanger via Unsplash

A Hong Kong court has recognized cryptocurrencies as property "capable of being held on trust" in a case involving defunct crypto exchange Gatecoin. The ruling would give Hong Kong liquidators greater clarity on how crypto assets held by companies should be treated in wind-down procedures. The ruling follows similar judgments in mainland China and the UK, while in the US, the Internal Revenue Service treats crypto as property for tax purposes.

Citi India has successfully completed its first blockchain-powered Letter of Credit (LC) transaction on Contour for industrial manufacturing firm Cummins India Limited. Contour enables secure and real-time collaboration between banks, corporations, and logistics partners on a single platform. The LC transaction between Cummins and its customer took only three hours, in contrast to the usual five to ten days of document presentation, demonstrating that the LC processing time can be reduced by up to 90%.

Thanks for reading and have a great week ahead!

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Written by Jon Lira. Connect with him on LinkedIn.

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