Every week, there seems to be a continuous stream of American fintech companies facing bankruptcy or legal actions from regulators. This relentless crackdown on cryptocurrencies is expected to greatly benefit Asia, emerging as the primary beneficiary.
The intentions of the American government regarding a flourishing digital asset industry and the accompanying innovation have become evident in recent months. The presence of regulatory ambiguity regarding asset classification and impulsive actions by federal agency leaders against anything associated with the industry have only exacerbated the situation.
Asia, with its clearer regulatory framework, stands to gain the most in the ongoing crackdown on cryptocurrencies. As a result, companies are compelled to expand their operations in other regions, as reported by the Straits Times on June 23.
Market players suggest that Hong Kong is poised to be the primary beneficiary, surpassing Singapore. Liu Yusho, the founder of the Singaporean exchange Coinhako, highlighted that Asia already hosts a thriving blockchain and crypto industry. He further noted that Southeast Asia, with only 8.6% of the world’s population, accounted for 14% of global crypto transactions by the end of 2022.
Furthermore, Japan is establishing itself as a prominent crypto hub in Asia, being one of the early adopters in accepting and regulating digital assets. Recently, the country introduced a framework that allows banks to utilize stablecoins, further solidifying its position in the crypto realm.
The shift in the crypto landscape towards Asia is becoming increasingly evident, with a rising number of American companies looking towards the region. In recent developments, Ripple obtained a significant payments license to operate in Singapore.
Additionally, the Monetary Authority of Singapore granted a license to stablecoin issuer Circle earlier this month. As the exodus of crypto companies from the United States continues, Coinbase, Gemini, and various other crypto firms are establishing exchanges and offices outside of the country.