Toyota’s Love for Ethereum, HK Backs Bitcoin ETF, Stablecoins: Asia Express

Asia’s Largest Automaker Shows Interest in Ethereum

Japanese automaker Toyota’s blockchain research division is exploring how Ethereum could contribute to its “mobility” campaign.

The campaign focuses on the company’s futuristic concept of a connected transportation system where vehicles can drive fully autonomously and communicate with public infrastructure through data exchange. These autonomous vehicles are envisioned as public institutions that serve all users, including the disabled and elderly.

Toyota proposed implementing blockchain technology as part of its “mobility” concept in a research paper published on July 19.

This is seen as blockchain enabling automation through programmability, similar to how Ethereum’s smart contracts automatically execute contracts without an intermediary.

Blockchain will also bring standardized interfaces that connect to other services. For example, in the automotive industry, blockchain could automatically pay tolls or parking fees directly from the vehicle’s wallet.

And by tokenizing rights, vehicles can be transformed into service entities, similar to how digital rights are managed in the music industry, where non-fungible tokens (NFTs) represent ownership and usage rights to digital assets.

However, achieving this requires a blockchain account, and your private keys can be lost due to unexpected events such as device failure.

Toyota suggests that Ethereum’s ERC-4337 standard could be key, as it introduces account abstraction, allowing users to execute transactions with smart contract code instead of private keys.

The car company has proposed using ERC-721 (NFT) to authorize blockchain-based vehicles.

Toyota is Asia’s largest automaker with a market capitalization of $270 billion, second only to Tesla on the global stage.

Bitcoin Downtrend Cheers as Hong Kong Launches Inverse ETF

While the crypto world is buzzing with the launch of a spot ether ETF in the US, Hong Kong is also making headlines by launching Asia’s first inverse bitcoin ETF.

The fund is managed by CSOP Asset Management, one of China’s largest asset managers, allowing investors to bet on a decline in the price of Bitcoin.

“By enabling betting on the market, such financial instruments have the potential to balance speculative activity and contribute to long-term market stability. This is crucial for the maturity of the crypto sector and the acceptance of cryptocurrencies as an established investment asset,” Tristan Frizza, founder of Zeta Markets, told Cointelegraph.

Hong Kong’s growing list of cryptocurrency ETFs has even surpassed the US in listing a spot Ethereum ETF.

But the number of businesses interested in cryptocurrencies is decreasing.

Most recently, the HKX exchange became the 13th exchange to have its application for a license withdrawn or rejected by the Securities and Futures Commission (SFC).

The Hong Kong securities regulator has only authorized two companies, HashKey and OSL, to legally operate in Hong Kong.

Meanwhile, some exchanges are coming back to life.

BitForex, which was designated as a “suspicious” exchange by the SFC in March 2024, has resurfaced after five months of silence and withdrawal freeze.

Bitforex claimed in a July 19 post that the team had been detained and investigated by Chinese police, which resulted in them losing access to the platform and users’ assets.

The exchange added that the platform has been cleared to “reopen shortly,” but services will be limited to withdrawals only.

Seoul’s $2 Million Crypto Drug Dealer Arrested in Dark Web Crackdown

The Seoul Metropolitan Police Agency announced on July 24 that it had arrested 10 individuals on charges of being involved in the illegal sale of drugs for cryptocurrency.

The group is accused of promoting its products on the dark web to customers in the metropolitan area and Seoul between January and April 2024. Police have also booked 50 people on charges of selling and using drugs.

Authorities seized 38 pounds (17.2 kg) of marijuana, 205 hashish plants, methamphetamine, LSD and six other types of drugs in connection with the incident, with a combined market value estimated at about $2 million (about 2.7 billion won).

One of the arrested suspects was identified as the supplier for this operation, who had been growing marijuana in greenhouses and containers in the remote mountains of Chungcheongnam-do Province in the western part of the country since April 2023.

They distributed cryptocurrency to customers in the metropolitan area using a ‘toss method’ and earned about $18,600 (about 26 million won) in cryptocurrency over four months.

The so-called throw method is one of the preferred drug drop-off techniques in Korea, where the dealer leaves the product at an agreed location and sends a confirmation photo to the customer. The customer then picks up the product without meeting the dealer and completes the transaction.

According to local law, criminals involved in the sale of illegal drugs can be sentenced to at least five years in prison.

The country’s drug control law states that repeat offenders are subject to a minimum sentence of 10 years in “death penalty” or “hard labor.” But the country has not carried out a single execution since 1997, and 59 people remain on death row.

Six of the ten suspects were confirmed to be repeat offenders.

Chinese retail giant’s subsidiary launches HKD stablecoin on public blockchain

Jingdong Coinlink, a subsidiary of Chinese retail giant JD.com, has unveiled a Hong Kong dollar-pegged stablecoin issued on a “public blockchain.”

On July 18, Jingdong was listed as one of the participants in the Hong Kong Monetary Authority (HKMA)’s Stablecoin Sandbox. The sandbox agreement allows potential stablecoin issuers to conduct tests and hash out potential regulatory requirements.

The Hong Kong Monetary Authority (HKMA), Hong Kong’s de facto central bank, has announced a stablecoin issuer sandbox program following the publication of a consultation paper on stablecoin issuer regulation.

The Hong Kong Monetary Authority (HKMA) has finalized a consultation document stating that stablecoins should always be fully backed by reserve assets, backed by monthly attestations verified by an independent auditor.

It added that reserve assets should be “high-quality liquid assets,” such as banknotes and coins, licensed bank deposits, liquid securities representing bonds, same-day reverse repurchase agreements, or tokenized versions of these assets.

Jingdong’s website uses similar language to describe its reserve assets: “highly liquid” and “highly reliable.”

India’s Crypto Industry Gets Answers on Tax Breaks

The Indian cryptocurrency industry was left disappointed when Finance Minister Nirmala Sitharaman made no mention of cryptocurrencies in her budget speech on July 23, leaving crypto taxes intact.

The industry has been advocating for the country’s 1% cryptocurrency transaction tax, which is levied on transactions as tax deducted at source (TDS), to be reduced to 0.01%.

The 1% TDS is levied on top of the 30% flat rate tax on cryptocurrency profits and has been cited as a major reason for the 97% drop in trading volumes on Indian exchanges since it was implemented in 2022.

“We expected the government to lower taxes to bring them in line with other asset classes,” Ashish Singhal, co-founder of CoinSwitch, said in a statement.

“Unfortunately, that didn’t happen. It was a missed opportunity to encourage startups and investors in the crypto space.”

Unocoin CEO Satvik Vishwanath told Cointelegraph that the 2024 budget is a sign that the Indian government does not yet view cryptocurrencies as a serious business, as they are still compared to gambling and betting.

However, Vishwanath added that the question is “when” local crypto taxes will be reduced, not “if.”

“We need more developed countries to promote crypto, launch ETFs or legalize crypto before we take a hard decision on tax reform for the crypto industry,” Vishwanath said.

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Yoon Yohan

Yohan Yoon is a multimedia journalist covering blockchain since 2017. He has contributed as an editor to Forkast, a cryptocurrency media outlet, and has covered Asian technology stories as an assistant reporter for Bloomberg BNA and Forbes. In his free time, he enjoys cooking and experimenting with new recipes.