YM Lee

The outline of Japan's 2025 tax reform has been finalized at the tax policy meetings of the Liberal Democratic Party and Komeito. As the review of the virtual asset income tax is specified in this outline, the expectations of Japanese virtual asset investors, who were concerned about high tax rates, are rising. According to a report by CoinPost on the 0th (local time), the Liberal Democratic Party mentioned in the tax reform outline that "virtual assets contribute to the formation of national assets as financial products, and it is necessary to establish laws such as investor protection explanations and regulations like other financial products with tax exemptions, as well as to review the obligation to report to tax authorities." Additionally, Takuya Hirai, the first digital minister of the Liberal Democratic Party's Digital Headquarters, requested through the financial minister's suggestion to △ designate gains and losses from virtual asset transactions as subject to separate taxation △ organize regulations related to virtual assets △ prepare for cybersecurity as assets contributing to the national economy. The media predicted that "the inclusion of tax content related to virtual asset transactions in this tax reform outline by the Liberal Democratic Party will serve as a foundation for specific institutional reforms such as future tax rate reviews, adjustment of gain and loss rules, and changes in tax classification." Currently, income from virtual asset transactions in Japan is classified as 'miscellaneous income' and is subject to a tax rate of up to 55%. With this tax reform proposal, the possibility of promoting a 20% separate taxation and a gain and loss carryover system is increasing, raising expectations among virtual asset investors and industry officials in Japan.

According to the data released by the Bureau of Economic Analysis on the 19th (local time), the United States' Q3 GDP rose by 3.1% compared to the previous quarter, surpassing Wall Street experts' forecast of 2.8%. The number of new unemployment claims announced at the same time recorded 220,000, slightly below the expected 229,000. This is also lower than the previous week's figure of 242,000. The number of continuous unemployment claims, which refers to those who claimed unemployment benefits for two consecutive weeks, was 1,874,000, below the expected 1,890,000. With key economic indicators such as GDP and unemployment claims showing better-than-expected figures, it indicates that the real economy is maintaining its resilience.

Ark Invest, led by Cathie Wood, has sold 13,780 shares of Coinbase, valued at approximately $3.9 million. According to The Block's report on the 19th (local time), Ark Invest sold the Coinbase shares to adjust the weighting of its ARKF ETF product under management. Coinbase (COIN) closed at $279.86 on the 19th, down 10.2% from the previous day.

The Australia Securities and Investments Commission (ASIC) announced on the 19th that it is initiating legal proceedings against Binance Australia Derivatives. According to a report by Decrypto on the 19th (local time), the Australia Securities and Investments Commission stated in a press release, "Binance made an error by classifying over 500 retail customers as wholesale investors from July 2022 to April 2023, resulting in these investors not receiving legal protection under Australian financial law." Under Australian law, retail customers are entitled to consumer protections such as a Product Disclosure Statement (PDS), Target Market Determination (TMD), and an internal dispute resolution system. However, ASIC emphasized that Binance failed to provide these safeguards, allowing customers to trade speculative and complex virtual asset derivatives without adequate support.

Joo Ki-Young, CEO of the on-chain analysis platform CryptoQuant, has expressed criticism regarding the domestic industry and economic situation. On the 19th, CEO Joo Ki-Young lamented on his X (Twitter), "Korean won and domestic assets are not attractive at all. This is because the government failed to grasp the situation and only forcibly defended the won's price. As a result, the exchange rate is also skyrocketing." He added, "The USDT traded on Upbit has already reached an IMF-level exchange rate, and I believe a massive outflow of national wealth is occurring. Many wealthy individuals I know are leaving Korea. I think the outflow of national wealth reflects the country's metacognitive ability as a report card." He also emphasized that the government's response needs to change. He stated, "The government should not forcibly hold onto capital going abroad but should think about making it return on its own. Unnecessary regulations should not be prioritized. Now I am also considering whether I should leave Korea."

Global cryptocurrency exchange Binance released the results of a survey conducted among over 27,000 platform users worldwide on the 19th (local time). The survey included participants from six continents: Asia, Australia, Europe, Africa, and Latin America, and consisted of questions about the future of cryptocurrency adoption, evolving regulatory perceptions, and new consumer trends. A significant number of respondents predicted that more real-world use cases would emerge in the cryptocurrency industry next year. Among the respondents, 16.51% believed that blockchain technology would be widely implemented in real applications, and 16.1% expected increased participation from traditional financial institutions and institutional investors to support this. Survey participants anticipated that the main theme of next year's market would be artificial intelligence (AI). 23.89% of respondents believed that AI tokens would drive market growth, with meme coins at 19.19% in second place, and decentralized finance (DeFi) at 12.37% in third. The market's bullish trend has significantly increased the number of users. According to the survey, 45% of respondents said they entered the cryptocurrency market in 2024.

The U.S. platform of the global cryptocurrency exchange Binance, BinanceUS, has announced its plans to resume operations. On the 19th (local time), Norman Reed, the interim CEO of BinanceUS, stated through an official channel, "We temporarily suspended fiat currency on- and off-ramps following the lawsuit action by the U.S. Securities and Exchange Commission (SEC) in June 2023, but the SEC has not yet presented evidence of illegal activity. Therefore, we are focusing on resuming USD trading services." He added, "While we cannot yet specify a definite timeline for resuming operations, we are planning with the goal of achieving a service resumption milestone by early 2025."

The Hong Kong Securities and Futures Commission has granted operating licenses to four virtual asset (cryptocurrency) exchanges. According to a report by The Block on the 19th (local time), the Hong Kong Securities and Futures Commission announced that it has approved license permits for four exchanges: HKbitEX, Accumulus, DFX Labs, and X IO. Hong Kong officially launched a licensing regime for virtual asset trading platforms (VATP) in June 2023 and recently announced plans to expedite the approval process.

On-chain analytics company Chainalysis announced the acquisition of Web3 security firm Hexagate. According to a report by Decrypt on the 19th (local time), Jonathan Levin, CEO of Chainalysis, stated on his X (Twitter) account, "Through this acquisition, Chainalysis and Hexagate will provide comprehensive risk solutions including blockchain security, compliance, and recovery." The details of the transaction, including the acquisition price, have not been disclosed.

Interview with Maksim Balashevich, CEO of Santiment Complexity and Expertise in the Crypto Market to Increase Trump Effect... Regulatory Environment Expected to Improve Bitcoin and Ethereum to Continue Strong Performance "The cryptocurrency market will experience a wave of institutional entry starting in 2025. The market will become more complex, and bidirectional volatility will increase." Maksim Balashevich, CEO of the global on-chain analysis platform Santiment, shared this outlook on next year's cryptocurrency market in an interview with Bloomingbit on the 19th. We delved into the blockchain industry and market outlook as predicted by this veteran of the crypto industry and data analysis expert. Complexity and Expertise in the Crypto Market to Increase CEO Balashevich believes that institutional participation in the crypto market will surge from next year. The growing market size has made cryptocurrencies attractive enough assets for institutions. He stated, "Since the debut of the Bitcoin (BTC) Spot ETF this year, institutional participation in the crypto market has been ongoing," and predicted, "In addition to this year, next year, various asset managers such as hedge funds, family offices, and pension funds are likely to allocate assets to multiple cryptocurrencies, including Bitcoin and Ethereum (ETH)." However, he pointed out that the notion that institutional participation will unconditionally lead to a rise in crypto prices is mistaken. CEO Balashevich explained, "The increase in market participation by institutional investors is generally a positive signal. However, as institutions like BlackRock increase, they will view the market from both long and short positions, leading to increased volatility and making the market more professional and complex." Trump Effect... Regulatory Environment Expected to Improve CEO Balashevich anticipates that the global crypto regulatory landscape will change positively after the Donald Trump administration takes office in January next year. He said, "Trump showed a very crypto-friendly attitude through his election pledges," and added, "Crypto regulations are likely to become more open and flexible, centered around the United States and Switzerland, and will positively impact the European and Asian markets." Donald Trump has proposed election pledges to promote the crypto industry, including △Strategic Bitcoin Asset Reserve △Support for Bitcoin (BTC) Mining in the U.S. △End of Crypto Regulation Crackdown △Abolition of Bitcoin Capital Gains Tax △Ban on CBDCs. He believes that the improved regulatory environment will lead to more active research into Web3 use cases, such as AI data processing. CEO Balashevich stated, "Santiment is also actively investing in and researching various use cases, such as stablecoins, decentralized lending markets, and AI-driven data processing." Bitcoin and Ethereum to Continue Strong Performance Bitcoin (BTC) and Ethereum (ETH), which have already risen to major asset classes, are likely to continue their strong performance. CEO Balashevich said, "No one knows when the market turning point will come in the future, but Bitcoin and Ethereum, which are currently leading the market, are expected to continue their strong performance," and added, "In particular, Ethereum is likely to rebound from negative sentiment and oversold conditions." He continued, "The market always follows cycles. Simplifying indicators and analysis is necessary to effectively respond to the up and down cycles." Meanwhile, he expressed somewhat negative views on altcoins other than Ethereum. He predicted, "Major altcoin projects like Solana (SOL) may face growth challenges due to technical issues and competitive pressure."

President-elect Donald Trump stated that the United States will accomplish great things based on cryptocurrency. On the 12th (local time), President Donald Trump emphasized in an interview with CNBC conducted at the NYSE, "We will accomplish great things through cryptocurrency. We don't want someone else, like China, to do that. We will be the nation leading the cryptocurrency world."

Macau has announced plans to integrate the e-PATACA central bank digital currency infrastructure within the Guangdong-Hong Kong-Macau Greater Bay Area (GBA). According to a report by Macau Business on the 12th (local time), Lei Wai Nong, the Secretary for Economy and Finance, emphasized, "Electronic payments have become an essential means of transaction in daily life. We will provide convenient payment options for both domestic and international travelers." The new CBDC white paper defines the e-PATACA as a digital form of legal tender regulated by central banks, distinct from virtual assets like banknotes, coins, and Bitcoin. CBDCs are divided into two types: wholesale and retail. Wholesale CBDCs are used for interbank transfers and transaction settlements by regulated financial institutions, while retail payments function like physical currency or cash and are primarily used for consumer payments. The government plans to support the use of digital pataca alongside existing payment tools in sectors specialized for small and medium-sized enterprises.

Decentralized Finance (DeFi) platform Step Finance announced the acquisition of tokenization startup Moose Capital. According to The Block's report on the 12th (local time), Step Finance plans to support the tokenization and trading of corporate stocks like NVIDIA and Tesla on the Solana blockchain through this acquisition. George Harrap, co-founder of Step Finance, emphasized, "Moose Capital utilizes tokenization licenses in various jurisdictions such as Canada and the UAE. By leveraging this, we aim to provide a tokenized stock infrastructure that overcomes the limitations of existing geographical accessibility and high fees."

The European Union has implemented a third consecutive rate cut. According to the European Central Bank (ECB) announcement on the 12th (local time), the European deposit rate was reduced by 25 basis points from 3.25% to 3.00%. The European Central Bank decided on a third rate cut following those in September and October. It appears that the additional cut was decided as inflation gradually falls to a controllable level and growth slows.