Crypto Regulatory Trends: Jeju NFTs, MiCA Fallout, Chile’s Bitcoin Push, Trudeau News

Four Crypto Firms Secure MiCA Licenses in the Netherlands, Expanding Across EU

Four digital asset companies have recently obtained Markets in Crypto Assets (MiCA) licenses in the Netherlands, enabling them to operate throughout all 27 European Union (EU) member states. The licensed firms include MoonPay, BitStaete, ZBD, and Hidden Road, following a filing with the Dutch Authority for the Financial Markets (AFM) on December 30, 2024. MiCA, which necessitates crypto firms to secure a Crypto Asset Service Provider (CASP) license from one EU member state, represents a significant regulatory development for the region's digital asset industry. The December 30 deadline required member states to implement the MiCA framework, though not all have succeeded. 

MoonPay's CEO, Ivan Soto-Wright, highlighted the company’s leadership in adopting this regulatory framework, emphasizing the importance of collaboration with the Dutch AFM. In addition to the Netherlands, Socios.com has received a class 3 Virtual Financial Assets Act license from the Malta Financial Services Authority (MFSA), enabling it to function as a regulated crypto service provider. Furthermore, the U.K. has officially listed the crypto trading firm GSR Markets in its crypto register, reflecting the nation’s increasing regulatory focus on digital asset businesses. Overall, these developments mark crucial steps towards a more structured crypto environment in Europe.

Chile Considers Strategic Bitcoin Reserve Amid Growing Political Support

Chile is contemplating the integration of Bitcoin into its economic framework through the establishment of a Strategic Bitcoin Reserve (SBR). Mining advocate Andrés Villagrán is at the forefront of this initiative, actively engaging with parliamentarians and government officials to emphasize Bitcoin’s potential as a national reserve asset. His advocacy, supported by figures such as Dennis Porter and Simon Collins, has gained traction since 2024, particularly after presenting the SBR concept to key government members, including those in President Gabriel Boric’s administration. The proposal for a bipartisan “Bitcoin Bench” to evaluate Bitcoin’s potential and draft related legislation, spearheaded by Deputy Gael Yeomans, demonstrates a growing political interest in the topic. 

Despite the enthusiasm, the Central Bank of Chile expresses skepticism regarding regulatory standards and IMF compliance that may inhibit the initiative. Nevertheless, Villagrán plans to enhance his outreach in 2025, focusing on gaining the backing of the Ministry of Finance and lawmakers. If successful, Chile could align itself with Brazil and other nations exploring Bitcoin as a reserve asset, potentially positioning itself as a leader in cryptocurrency adoption within Latin America and enhancing financial stability during global economic uncertainties.

UAE Becomes Preferred Haven for Crypto Ventures Amid EU's Strict MiCA Regulations

The United Arab Emirates (UAE) is emerging as a prime destination for crypto and stablecoin ventures looking to escape the newly enacted Markets in Crypto-Assets (MiCA) regulation by the European Union (EU), which fully took effect on December 30, 2024. The MiCA framework imposes stringent guidelines, requiring small stablecoin issuers to maintain 30% of their reserves in low-risk EU-based banks, while larger entities like Tether must hold 60% or more. Such requirements are increasing operational costs and financial burdens, particularly for smaller firms. 

Industry experts, including Uldis Teraudkalns from Paybis, project a significant exodus of crypto companies from the EU, with the UAE’s crypto-friendly policies and stable regulatory environment encouraging this migration. Alongside the UAE, jurisdictions like the UK and Switzerland may also attract fleeing firms. Experts highlight that firms will assess access to banking services and regulatory predictability when relocating. Agne Linge from WeFi noted the potential liquidity disadvantages for larger players like Tether that primarily operate outside the EU. Overall, the MiCA regulation could lead to both regional and global migration in the crypto sector, impacting competition and market dynamics significantly. Companies, including MoonPay, are adapting to the evolving regulatory landscape.

Czech National Bank Governor Considers Bitcoin for Future Reserve Diversification

The Governor of the Czech National Bank, Aleš Michl, has recently expressed interest in considering Bitcoin as part of the bank's diversification strategy for its foreign exchange reserves. In an interview with CNN Prima News, Michl mentioned the possibility of acquiring "a few Bitcoin," albeit this would not constitute a significant investment for the bank. However, any decision to purchase Bitcoin would require approval from the bank’s seven-member board, and currently, no formal plans for such an acquisition exist. Despite this, there remains openness to future discussions regarding Bitcoin diversification. 

Concurrently, the bank plans to bolster its gold holdings to approximately 5% of total assets by 2028. The appeal of Bitcoin lies in its remarkable performance, with a 131% rise in the past year as opposed to gold's 30% increase. This trend suggests a reevaluation among institutions of what constitutes a "safe" reserve asset, as noted by blockchain expert Anndy Lian. However, Bitcoin's inherent price volatility poses significant risks, potentially leading to broader financial fluctuations in national reserves. Michl's remarks signal a noteworthy shift in governmental attitudes towards cryptocurrency as a legitimate reserve asset.

Trudeau Expected to Resign as Liberal Leader; Poilievre's Crypto Stance Could Transform Canadian Politics

Canadian Prime Minister Justin Trudeau is expected to announce his resignation as leader of the Liberal Party, possibly later today, according to anonymous sources. His leadership has faced significant challenges, including a series of disappointing polls and increasing criticism from within his party. Since taking office in 2013 and leading the Liberals to power in 2015, Trudeau has grappled with the impacts of the COVID-19 pandemic, rising costs, and a strained housing market attributed to his immigration policies. 

In contrast, Conservative Party leader Pierre Poilievre has emerged as a prominent critic of the current government, advocating for cryptocurrencies and denouncing the Bank of Canada’s policies. Poilievre aims to position Canada as the "Blockchain capital of the world" and supports a regulatory framework for blockchain companies while opposing a central bank digital currency. He has personal investments in Bitcoin and argues cryptocurrencies provide a hedge against inflation. Trudeau has dismissed Poilievre's crypto stance as irresponsible, warning about the volatility of such assets. The political landscape may dramatically shift if Trudeau resigns, especially with the next federal election scheduled for October 20, 2025, which could enable Poilievre to influence Canada’s future financial policies significantly.

Thailand Launches Bitcoin Payment Pilot in Phuket to Attract Tourists

Thailand is set to launch a Bitcoin payment pilot program in Phuket, targeting foreign tourists to enhance the local tourism sector. Announced by Deputy Prime Minister and Finance Minister Pichai Chunhavajira at a seminar organized by the Marketing Association of Thailand, the initiative aims to allow visitors to use Bitcoin for various transactions, including shopping and services, without requiring new legislation, as current laws already permit crypto-asset dealings. The pilot program will facilitate the registration of Bitcoin through Thai exchanges, enabling tourists to verify their identities and make payments seamlessly.

This move is crucial for maintaining Thailand's competitiveness in the global tourism market, especially as interest in cryptocurrencies continues to grow. Pichai highlighted the finite supply of Bitcoin, capped at 21 million coins and valued over $2 trillion, as a contributing factor to the initiative's justification. Notably, Phuket has attracted a diverse international community, including individuals displaced by the Russia-Ukraine conflict, who will find it beneficial to conduct their transactions using cryptocurrency for everyday expenses, property, and rent payments. 

South Korea's FSC Plans Corporate Crypto Investments with Strict Standards Amid Exchange Delistings

South Korea's Financial Services Commission (FSC) revealed plans to allow corporate firms to invest in cryptocurrencies under a structured regulatory framework, starting with non-profit organizations. The FSC aims to establish clear standards for listing and delisting cryptocurrencies, enhance transparency, and limit participation to reliable entities through stringent eligibility checks and guidelines for risky assets like meme coins. 

Meanwhile, South Korean crypto exchanges, including Upbit, are reportedly set to delist meme coins and low-cap "kimchi coins" due to concerns over their lack of utility and susceptibility to price manipulation. This has caused anxiety among traders, with Bitcoin Gold's delisting on January 23, 2025, serving as a notable example. Regulators have pressured exchanges to standardize listing criteria, highlighting the speculative nature of certain tokens. Industry experts argue that meme coins must evolve with tangible use cases to sustain relevance. 

Bhutan's Gelephu Mindfulness City Integrates Bitcoin, Ethereum, and BNB as Reserve Assets

Gelephu Mindfulness City (GMC), a Special Administrative Region in Bhutan, has officially adopted Bitcoin (BTC), Ethereum (ETH), and Binance Coin (BNB) as part of its strategic reserves, marking it as one of the first jurisdictions globally to integrate cryptocurrencies into its financial strategy. This initiative aims to bolster the city’s economic resilience and reflects an evolution in its involvement with bitcoin mining. GMC plans to focus on digital assets with large market capitalizations and deep liquidity, ensuring they are easily tradable without significant price impact. The move follows the enactment of the Application of Laws Act 2024, which establishes a regulatory framework for digital asset services within the region. 

GMC is strategically positioned as a land bridge between South Asia's growing economies, enhancing its potential as a hub for technological advancements and financial services. A high-level meeting is scheduled for March 2025, gathering global government officials and industry leaders to discuss the recognition of digital assets as reserves and the formation of an international advisory panel. GMC's actions align with a broader trend in global crypto adoption, seen in movements by the Czech Republic, various U.S. states, and Switzerland, signaling a shift towards the acceptance of digital assets in national financial strategies.

Portugal's BiG Suspends Fiat Transfers to Crypto Platforms Amid ECB Regulatory Concerns

Banco de Investimentos Globais (BiG), a major Portuguese bank, has suspended fiat transfers to cryptocurrency platforms, citing compliance with European Central Bank (ECB) guidance on risks related to virtual assets. This decision, highlighted in a customer email, is influenced by increasing regulatory scrutiny and the EU's drive for stricter guidelines under the Markets in Crypto Assets (MiCA) regulation. 

The move has sparked concerns among experts that it may inadvertently push users towards decentralized platforms, outside traditional banking controls. Notably, other banks, such as Caixa Geral de Depósitos, continue to process crypto-related transfers, indicating a cautious approach within the industry despite Portugal's historically crypto-friendly policies, exemplified by previous exemptions from VAT and capital gains tax. 

Portugal's stance has shifted, as reflected by the introduction of a 28% capital gains tax on short-term crypto holdings in 2023, a significant change from its previous status as a crypto tax haven. As financial institutions navigate tighter regulations, BiG’s action underscores broader global apprehensions regarding the risks associated with digital currencies, while Portugal's evolving regulatory landscape signals potential constraints on crypto activity within its borders.

Kazakhstan Shuts Down 36 Illegal Crypto Exchanges, Seizes $112 Million in Assets

In 2024, Kazakhstan intensified its crackdown on illegal cryptocurrency exchanges, shutting down 36 operations without proper authorization and seizing assets worth approximately $112 million. This action, part of ongoing Anti-Money Laundering efforts, marks a significant decrease of 96% in illegal exchanges compared to 2023. The Financial Monitoring Agency of Kazakhstan highlighted the risks posed by these illegal entities, which facilitate money laundering and often evade client identification, making them attractive to cybercriminals and drug traffickers. In 2023, the agency had already blocked 980 unlicensed exchanges, alongside launching numerous investigations into illegal activities. 

To date, Kazakhstan has dismantled over 3,500 unlicensed crypto platforms with help from various government bodies. Among the closed exchanges, two were linked to pyramid schemes, resulting in restitution for affected investors. As Kazakhstan prepares for the launch of its central bank digital currency (CBDC) known as the digital tenge in 2025, authorities aim to collaborate with international organizations to strengthen regulations, improve transaction monitoring, and develop technology for seamless integration into payment systems, allowing for global transactions using digital currency. 

Oklahoma Senator Introduces Bill to Allow Bitcoin for Wages and Transactions

Oklahoma Senator Dusty Deevers has introduced the Bitcoin Freedom Act (SB325) to enable the use of Bitcoin for wages and transactions within the state, positioning it as an alternative to the weakening U.S. dollar amid rising inflation. The legislation aims to allow payments in Bitcoin across state agencies, businesses, and personal dealings, adhering to existing financial regulations. Deevers emphasizes Bitcoin's fixed supply and decentralized design as a safeguard against federal economic policies. He believes this initiative could position Oklahoma as a national leader in financial technology adoption. 

The bill reflects broader trends, with states like Ohio, Texas, and Pennsylvania exploring the integration of Bitcoin into their treasury reserves, citing its potential as a hedge against economic uncertainty. Texas has proposed holding Bitcoin as a reserve asset for at least five years, and Pennsylvania plans to allocate up to 10% of its balance sheet to Bitcoin. Concurrently, major corporate holders are expanding their Bitcoin reserves, although the U.S. government is not expected to purchase Bitcoin in 2025, focusing instead on managing its current stockpile. The Bitcoin Freedom Act is set for debate in Oklahoma's legislative session starting February 3, 2025.

HKMA Launches DLT Incubator to Boost Blockchain Adoption in Banking

The Hong Kong Monetary Authority (HKMA) launched the “Supervisory Incubator for Distributed Ledger Technology” (DLT) to support banks in adopting blockchain solutions safely. Arthur Yuen, HKMA’s Deputy Chief Executive, highlighted the initiative's pivotal role in creating secure and efficient DLT-based banking systems. 

The incubator comprises two components: personalized support for individual banks, including a dedicated advisory team for live trials, with an initial focus on tokenized deposits, and industry-wide collaboration for sharing best practices and conducting research to enhance blockchain integration across the sector. This initiative was announced during the HKMA's FiNETech4 event, which gathered over 300 financial professionals. Carmen Chu, HKMA Executive Director, emphasized potential innovations like real-time ledger updates and autonomous bookkeeping. 

Concurrently, Hong Kong regulators are discussing integrating Bitcoin into the national reserve, and four new licenses were granted to virtual asset trading platforms, bringing the total to seven. Despite these advancements, Hong Kong continues to face challenges in becoming a crypto-friendly financial hub, particularly compared to Singapore, which has issued 13 licenses in the past year, contrasting with Hong Kong's slower licensing process and regulatory hurdles that deter crypto firms.

China's New Guidelines Position Blockchain as Key to National Data Strategy by 2029

China's "National Data Infrastructure Construction Guidelines" position blockchain as a pivotal component in enhancing national data security, transparency, and scalability. The ambitious initiative aims for a fully operational blockchain-powered data infrastructure across the country by 2029, with a phased implementation plan. Between 2024 and 2026, pilot projects will commence in key regions to refine blockchain frameworks and real-world applications, progressing to fully integrated national networks by 2028. Central to this strategy are "trusted data spaces" that facilitate secure, multi-party data sharing while ensuring privacy and data integrity. 

Additionally, blockchain-based "data markets" will allow for the tokenization of data assets, promoting monetization and secure trading, thereby unlocking new revenue streams and fostering data sharing. The guidelines also emphasize the development of decentralized applications (dApps) in sectors like digital finance and green energy. Security measures will incorporate advanced privacy technologies, such as homomorphic encryption, to protect sensitive data. Furthermore, blockchain-based monitoring systems will enhance data integrity and resist cyber threats by decentralizing control over data flows. 

Kenya Set to Legalize Cryptocurrencies, Says Finance Minister John Mbadi

Kenya is preparing to legalize cryptocurrencies, marking a significant policy shift announced by Treasury Cabinet Secretary John Mbadi on January 10, 2025. This legislative move aims to establish a regulated environment for cryptocurrencies and Virtual Asset Service Providers (VASPs), addressing risks like money laundering and fraud while promoting a competitive market. Mbadi emphasized that Kenya's financial sector is a leader in innovation across Africa, benefiting from the rise of Virtual Assets (VAs). The proposed policy seeks to create a fair and stable market, enhance financial inclusion, and position Kenya as a key player in the global digital finance ecosystem. 

Despite previously banning crypto, the widespread underground usage demonstrates its growing importance, with Kenya ranked third in Sub-Saharan Africa and 28th globally in crypto adoption, according to Chainalysis. The International Monetary Fund (IMF) has also recommended more comprehensive regulations to ensure compliance with international standards, focusing on consumer protection and the mitigation of risks related to money laundering and terrorism financing. 

Germany Explores New Strategies for Bitcoin Adoption Amid Recent Market Challenges

Policymakers in Germany are actively exploring strategies to adopt Bitcoin (BTC) and enhance the country's competitiveness in the digital currency landscape, as discussed during a recent Blockchain Roundtable in the German Parliament. Christian Lindner, the former finance minister, proposed three key approaches for Bitcoin adoption. 

Firstly, he recommended that the German government issue bonds on the blockchain, leveraging its transparency and efficiency to establish Germany as a leader in this domain. Secondly, Lindner suggested that Germany or the European Union consider holding Bitcoin as a strategic reserve asset, aligning with global trends to view Bitcoin as a reliable store of value and a hedge against inflation. Finally, he advocated for enabling Bitcoin exchange-traded funds (ETFs) in the EU, which would provide regulated investment options for both institutional and retail investors, supporting greater market liquidity. 

Notably, this roundtable follows a significant event in July 2024 when German authorities sold approximately 50,000 BTC from a seized stash, causing a drop in Bitcoin’s price from around $70,000 to $56,000.