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Chinese Crypto Investor to Develop Stablecoin Within Hong Kong-Based Blockchain Fund

China’s Bitcoin “tycoon” Li Xiaolai will develop a stablecoin within the Hong Kong-based blockchain fund Grandshores Technology.

Chinese crypto investor Li Xiaolai will lead a stablecoin project within Hong Kong-based blockchain fund Grandshores Technology, according to an official document issued on Monday, Dec. 3.

China’s Bitcoin (BTC) “tycoon” Li Xiaolai has been also appointed as an executive director and co-chief executive officer of Grandshores Technology starting from Monday, Dec. 3.

Within the new position at the blockchain fund, Li Xiaolai will lead a number of initiatives including the launch of a stablecoin, establishment of a Directed Acyclic Graph (DAG)-based public database, development of Trusted Execution Environment (TEE) technologies, and other blockchain-related projects.

According to the report, the new stablecoin will represent a “stable digital currency system” that that will be focused on global mainstream currencies.

As previously reported by Cointelegraph, Grandshores Technology blockchain innovation fund revealed its plans in mid-September to raise $12.7 million in order to fund stablecoins.

The fund’s chairman Yao Yongjie had announced that the company plans to launch three fiat-pegged stablecoins, with the first expected to be based on the Japanese yen. Two other stablecoins are expected to be pegged to the Hong Kong and Australian dollar. As previously reported, Grandshores Technology is planning to offer investments through U.S. dollar-pegged stablecoin Tether (USDT), with a yen stablecoin set up for launch in January, 2019.

In early October, Li Xiaolai claimed that he will stop investing in blockchain-related projects, citing increased fraudulent activity in the blockchain industry.

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German Private Equity Fund Targets Bitcoin Mining аs Clients Demand ‘Regulated Product’

Xolaris Service KVAG, a German alternative investment fund manager, has launched a private equity fund dedicated to Bitcoin mining.

German alternative investment fund manager Xolaris Service KVAG has launched a private equity fund dedicated to Bitcoin mining, the company confirmed in a press release Nov. 29.

Xolaris, which has undertaken various expansion measures including the opening of a Hong Kong office in July, says client demand to access the sector continues despite the downturn in Bitcoin (BTC) prices.

The fund will feature a minimum investment entry of €250,000 ($285,000), with a planned issue volume of between €30 million and €50 million ($34 million – $57 million).

“We’ve constantly received requests from professional investors to release a regulated product for the cryptocurrency sphere,” head of portfolio management Stefan Klaile said in the release.

The fund will come as a joint project with Marc Stehr, owner of an extant mining farm in Sweden, with the fund’s capital first going towards the farm’s expansion.

The decision was made due to Stehr “already having access to operational mining infrastructure,” which “demonstrably successfully produces Bitcoin.”

“This eliminates a number of risks,” Klaile added.

As Cointelegraph reported, the drop in Bitcoin prices to around $3,500 had appeared to put pay to many miners’ profitability, with China seeing mass dumping of hardware due to the crisis. Last week, U.S.-based operation Giga Watt filed for bankruptcy.

The picture remains far from one-sided meanwhile, with the government of Paraguay at the same time announcing it would endorse and support “Golden Goose,” a project to build the world’s largest Bitcoin mining farm.

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Confirmed: Crypto Exchange Huobi Acquires Publicly Listed Firm on HK Stock Exchange

Cryptocurrency exchange Huobi has acquired controlling stock interest in Hong Kong-based Pantronics Holdings Ltd., according to an official announcement from the Hong Kong Stock Exchange (HKEx) dated August 29.

As Cointelegraph reported August 28, HKEx-listed Pantronics, an electronic products manufacturing firm, had halted trading of its shares on the Main Board of exchange on August 22, citing a “possible offer to be made under Rule 26 of the Hong Kong Codes on Takeovers and Mergers.”

Indications at the time suggested Huobi had acquired 73.73 percent of the firm. HKEx’s official announcement clarifies that Huobi, alongside blockchain services provider platform Fission Capital, acquired an overall stake of 71.67 percent in Pantronics — at a breakdown of 66.26 percent and 5.41 percent respectively.

While Huobi’s acquisition had the apparent hallmarks of being a reverse takeover  — or reverse Initial Public Offering (IPO) — Sandy Peng, a partner at Fission Capital, told Cointelegraph in a statement that “for the time being this is a straight forward acquisition […] as stated in the announcement Huobi intends to start new blockchain related businesses using this entity.” Peng added that:

“Fission [has] years of experience in the HK Capital market. We participated in this acquisition alongside Huobi [and] believe Huobi’s rich experience in this sector, the institutional and regulated international platform this new vehicle creates will be the ideal launchpad for any international and institution related businesses that Huobi may decide to explore in the future.”

Peng considered that the official HKex disclosure is “in a way an announcement from Huobi,” proposing that “the distinction is unimportant.” Huobi has however declined to comment on the disclosure in response to requests from Cointelegraph.

While Peng has refuted the deal’s characterization as a reverse takeover, the route can be expedient for privately held firms, allowing them to circumvent the lengthy and complex process of going public through direct acquisition of a publicly-held entity. Upon completion of the deal, the buyer gains automatic inclusion on a stock exchange.

Mike Novogratz is one high-profile example from the crypto space who opted for the route in order to secure a listing on Toronto’s TSX Venture Exchange for his crypto-focused merchant bank Galaxy Digital.

Huobi is currently ranked 4th largest crypto exchange in the world by daily trade volumes, seeing around $833.7 million in trades over the 24 hours before press time.

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Asia’s First Cryptocurrency Visa Debit Card Coming To Singapore

A Hong Kong based blockchain startup is preparing to roll out the region’s first cryptocurrency Visa debit card. It has applied for licenses and plans to issue 100,000 cards starting in Singapore over the next two months., previously known as Monaco before a name change in July, also plans to apply for money lending licenses in Singapore and Hong Kong before expanding its crypto debit card services to include crypto backed money lending. Company co-founder and CEO, Kris Marszalek, said;

“To holders of cryptocurrencies, having the peace of mind that you can readily convert back into fiat currencies and cash out is very important. Not all exchanges support crypto-to-fiat transactions, and even if you hold your digital assets at the exchanges’ wallet, the withdrawal process is also complicated. We believe our product addresses a real need, and enhances trust in digital assets,”

According to the SCMP holders of the firm’s crypto debit cards and users of its crypto wallet services can also take out loans backed with Bitcoin and its own native MCO token. A stored-value facility license has already been granted by the Monetary Authority of Singapore (MAS) and the cards are issued in partnership with Wirecard Bank from Germany.

The firm has ambitions of disrupting the credit card industry claiming that banks have been unethical in issuing unsecured revolving credit to consumers who can barely afford their interest rates. Marszalek added;

“The credit card business model is one that is bordering on unethical business, as banks make a big chunk of profit from people who cannot afford late fees. These people should not be given a credit card in the first place,”

To reduce this risk, customers will only be able to borrow fiat currency up to 40-60 percent of the value of cryptocurrencies they must pledge to the company as collateral. Credit history will not be check for the crypto debit card application but KYC procedures will be carried out. The volatility risks with Bitcoin and altcoins will be taken by itself.

The debit card will be linked to fiat and crypto wallets supporting BTC, ETH, LTC, MCO and BNB in addition to seven fiat currencies including US, Singapore and Hong Kong dollars.

$26.7 million was raised in the firm’s ICO last year, and its tokens are currently trading on 21 exchanges according to the report. MCO is currently trading at $4.65, down 7% on the day with the rest of the markets during today’s big selloff.


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Hong Kong Extends Migrant Policy to Facilitate DLT and FinTech Professionals

A new Hong Kong government initiative seeks to attract professionals in Distributed Ledger Technology (DLT) by simplifying the immigration policy, according to a press release published August 28.

On Thursday, the government of Hong Kong published its first Talent List aimed at attracting “highly skilled” experts in 11 different fields, including fintech, DLT, and cyber security, from around the world. The move designates the government’s intention to “support Hong Kong’s development as a high value-added and diversified economy.”

According to the press release, Hong Kong will facilitate successful applicants under the Talent List through the Quality Migrant Admission Scheme (QMAS). The QMAS has an annual quota of 1,000 people. The Chief Secretary for Administration and Chairman of the Human Resources Planning Commission, Matthew Cheung Kin-chung, said:

“The promulgation of the Talent List is one of our major initiatives to enhance our competitive advantages in attracting international talents, creating cluster effects, stimulating the development of local talents and propelling Hong Kong forward.”

While Hong Kong continues taking regulatory actions towards digital currencies and Initial Coin Offerings (ICOs), stating that the new technology “comes with risks,” it seems to have set sights on becoming an international blockchain hub.

Last month, the Hong Kong Monetary Authority (HKMA) announced the launch its own blockchain trade finance solution with 21 banks in August, aiming to substantially reduce paperwork, costs, and security risks for participants.

In June, the HKMA signed a fintech collaboration agreement with the Financial Services Regulatory Authority of the Abu Dhabi Global Market “to start a dialogue on the opportunity to build a cross-border trade finance network using [DLT].” That month, Alibaba subsidiary Ant Financial trialled its first blockchain remittances, sending a transaction in three seconds between its AliPayHK app in Hong Kong and Filipino payment app GCash.

The Hong Kong University of Science and Technology Business School (HKUST) recently received a $20 million research grant to improve the security capabilities of electronic payment systems earlier this month.

Additionally, the HKUST in partnership with the University of Hong Kong are planning to explore blockchain technology applications, and discuss the possibility of Hong Kong’s transformation into a global fintech hub.

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Hong Kong to Expedite Immigration for Blockchain Job Seekers

Hong Kong is seeking to attract worldwide talents with specialties in innovative technologies including blockchain via a special immigration policy.

The Hong Kong government released a talent list on Tuesday that covers a range of 11 professions that are now eligible to receive bonus marks when experts in these areas apply for the city’s Quality Migrant Admission Scheme (QMAS).

One of the areas is dedicated to “innovation and technology experts in, but not limited to, … artificial intelligence, robotics, distributed ledger technologies, biometric technologies and industrial/chemical engineering, etc.”

Launched in 2006, the QMAS allows successful applicants to enter and settle in the Chinese special administrative region without having to first secure a job offer from a local employer.

“The Scheme is a quota-based entrant scheme. It seeks to attract highly skilled or talented persons to settle in Hong Kong in order to enhance Hong Kong’s economic competitiveness,” according to the program’s description.

The scheme’s selection process requires applicants to meet several prerequisites before being awarded points under one of the two points-based tests: General Points Test and Achievement-based Points Test. The points are further used for competing with other applicants each year.

“For applicants who meet the specifications of the respective profession under the Talent List, bonus marks will be given under the General Points Test of the QMAS,” the government said in the announcement.

To be qualified in the innovation and technology area, blockchain professionals need to hold a bachelor or above degree with experience in notable firms in the filed and knowledge of how to apply blockchain in financial services.

The effort comes at a time when the Hong Kong government is taking the lead in adopting blockchain to boost the city’s competitiveness in financial technology.

As CoinDesk previously reported, the Hong Kong Monetary Authority, the city’s de facto central bank, is set to roll out a distributed ledger network among several banks in the region to facilitate transactions in trade finance.

Hong Kong image via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

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Crypto Exchange Huobi Seeks to Acquire Public Firm in $77 Million Deal

Cryptocurrency exchange Huobi is quietly seeking to become the largest shareholder of a public firm listed in Hong Kong – a move that, if completed, could open the door for Huobi to go public via a reverse takeover.

According to shareholding disclosures filed by Pantronics Holdings on Aug. 21 to the Hong Kong Stock Exchange, the public company is transferring more than 221 million of its ordinary shares to Li Lin, the chairman of Huobi Group, via several of the exchange’s subsidiaries.

With the disclosed amount, Li is poised to be the ultimate owner of 73.73 percent of Pantronics as the largest substantial shareholder. Based on the filing, the transaction is being priced at HK$2.72 (or $0.35) in average per share with a total amount nearing $77 million.

The deal, if approved, could give Huobi the opportunity to take over a public company and thus enter the secondary financial market – a process known as a reverse takeover.

Pantronics, an electronics manufacturing service provider established in 1990 and went public in 2016, has not yet made any official announcement regarding the completion of the deal, or any potential corporate restructure afterwards.

A representative for Huobi told CoinDesk that the crypto exchange is still waiting for confirmation and approval from the Hong Kong Stock Exchange. As such, the company can’t comment on the issue at the moment.

Following the initial notice, Pantronics has halted the trading of its shares on the exchange since Aug. 22, “pending the release of an announcement relating to a possible offer to be made … on Takeovers and Mergers, which is inside information in nature,” the firm said at the time.

Gelonghui, a Chinese media that covers the financial market, first reported around 18:00 UTC on Monday that Pantonics had transferred 73.73 percent of its ownership to Li.

Following the initial news, the price of Huobi Token, the exchange’s own crypto asset, immediately jumped by eight percent and is now seeing a six percent rise over the past 24 hours, according to data from CoinMarketCap.

Huobi’s move also comes at a time when several other Chinese private firms in the cryptocurrency space are applying for initial public offerings (IPOs) in Hong Kong, including bitcoin miner makers Canaan Creative and Ebang.

Another bitcoin mining giant Bitmain, is also reported to be weighing an $18 billion IPO in Hong Kong.

Li Lin image via CoinDesk

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

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Report: Huobi Acquires Controlling Share in Investment Company via Backdoor Listing

Chinese cryptocurrency exchange Huobi has reportedly acquired the controlling stock interest in Hong Kong-based Pantronics Holdings Ltd. through a backdoor listing deal, local news outlet reported August 27.

A backdoor listing, which is also known as a reverse takeover or reverse Initial Public Offering (IPO), allows a privately held company to purchase a publicly traded company avoiding the public offering process, regulatory issues, and due diligence. Upon completion of the deal, the buyer gains automatic inclusion on a stock exchange.

Huobi reportedly acquired 73.73 percent of Pantronics Holdings Ltd., which makes the crypto exchange the actual controller of the power-related electrical and electronic products manufacturer. Pantronics halted trading its shares on the Main Board of the Hong Kong Stock Exchange (HKEx) on August, 22, 2018 due to a “possible offer to be made under Rule 26 of the Hong Kong Codes on Takeovers and Mergers.”

When asked whether the exchange intends to conduct a backdoor listing, Huobi CEO Li Lin reportedly said that “it is just a rumor.” Li stated the exchange business is currently not fully compliant on a global scale, so a backdoor listing would be very difficult to operate. Li added that he believes the “traditional financial market will embrace the blockchain economy in the future.”

On July 30, Caixin media reported that the HKEx was preparing a revision of rules to take stern measures towards backdoor listings within its efforts to clean up the market and improve the quality of listed companies. While the proposed measures are reportedly not aimed at blocking backdoor listings, they intend to ensure that companies do not skirt rules and undermine investor confidence. David Graham, HKEx’s chief regulatory officer and head of listing commented:

“We essentially allow a backdoor listing. But what [we want] to ensure is that when this happens, the quality of the assets and the ultimate combined company to be listed on our exchange have been through an appropriate due diligence and vetting process.”

Houbi Token is currently trading at $2.35 according to Coinmarketcap, having gained almost 8 percent over 24 hour period, while some media attribute the token’s price surge to the recent acquisition. Pantronics Holdings Ltd.’s market capitalization is currently over HKD 926 million ($118 million).

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BitMEX Leases The World’s Most Exorbitant Offices In Hong Kong

BitMEX has hit the crypto printing press again, with the Hong Kong Economic Times, a local newspaper, reporting that the exchange had signed an agreement to rent out the world’s most expensive office spaces.

BitMEX, founded by former Citigroup trader Arthur Hayes has reportedly leased out the whole 45th floor of the Cheung Kong Center. This information comes anonymously via individuals allegedly knowledgeable about the firm’s plans.

While any piece of Hong Kong real estate is already expensive in and of itself, Cheung Kong Center, which is also home to Goldman Sachs, Barclays, the Bank of America and Bloomberg, has one of the highest $/Sq.ft ratios in the world.

In January, when Bloomberg interviewed Hayes, they discovered that the firm’s Hong Kong offices at the time were located in a lesser-known warehouse district, where rent is HK$25 ($3.18) for each square foot. But with the firm’s move to Cheung Kong, which is smack dab in one of Hong Kong’s flashiest districts, BitMEX will need to pay a staggering HK$225 per square foot, a near ten-fold increase from the rent requirements of their previous office.

According to the Hong Kong Economic Times, the outlet that first broke this news, the 45th floor consists of 20,000 square feet, which will mean that the exchange will pay the equivalent of over $573,000 a month in rent.

Some legacy market cynics see this as sort of ‘power play’, with BitMEX’s appearance in such an office space alluding to the fact that crypto is here, and is here to stay for the long haul. Others see this as a strategic move, with such a move putting the exchange within arms reach of the most influential financial and technology firms in the world. But most importantly, this move shows that BitMEX has still been raking copious amounts of profit in, even as the crypto market has essentially fallen off a sharp, tall cliff.

BitMEX’s Growing Influence Over The Crypto Industry

As reported by Ethereum World News, the market surged after BitMEX announced that it would be temporarily shutting down to do maintence work on its engine. While this announcement may seem mundane on the surface, Bitcoin rose by nearly $500 in the minutes following the commencement of BitMEX’s downtime. Altcoins followed closely behind the market leader, posting similar gains in terms of percentage.

Even as BitMEX’s one-hour of downtime finished, the market held its gains (temporarily at least), with Bitcoin finding a place to stand at $6,700. While some speculated that this bout of positive price action was just an untimely coincidence, many noted that such a move could only be attributed to the scheduled maintence of the world’s largest Bitcoin exchange.

Issuing a tweet regarding this occurrence, Crypto commentator and ”s***poster’ EmptyBeerBottle drew attention to the fact that this move indicates the vast amount of influence the exchange has over the market. As such, the crypto personality noted that BitMEX should not be discredited, as the exchange has evidently become an integral part of this nascent industry and market.

Photo by Jason Wong on Unsplash