Crypto On LYO: The Blend — Kazakhstan Launches CBDC Oversight Body, California Edges Toward Crypto Regulation, South Koreans Own $99B in Overseas Digital Assets

What happened in the crypto world in the last week? Let’s see some interesting news together!

Kazakhstan Launches CBDC Oversight Body

On September 15, the National Bank of Kazakhstan (NBK) announced the formation of the National Payment Corporation (NPC) to spearhead the development and implementation of the country’s central bank digital currency, the Digital Tenge.

The NPC, a reorganization of the Kazakhstan Interbank Settlement Center, will also supervise the national payment system, including interbank clearing services, money transfers and interbank payments, and digital identification.

Additionally, the NPC will oversee the creation of the “digital financial infrastructure,” including the rollout of the digital tenge, which began development in February 2023, with a target launch date of 2025.

NBK Deputy Governor Berik Sholpankupov had previously outlined the bank’s vision for a “collaboration between traditional finance and DeFi” aimed at increasing financial inclusion and supporting international trade.

At present, the CBDC program in Kazakhstan is being piloted in a controlled environment, with real consumers and merchants participating in the exercise. In June, crypto exchange Binance revealed its partnership with Freedom Finance Bank in Kazakhstan to introduce a regulated digital asset platform. This collaboration enables users to seamlessly transfer fiat funds to their platform accounts.

California Edges Toward Crypto Regulation while Awaiting Governor’s Decision

California stands on the verge of implementing a fresh cryptocurrency regulatory framework, as the state legislature recently greenlit a bill mandating licensing and other regulations for cryptocurrency firms.

This legislation now awaits Governor Gavin Newsom’s decision, with a deadline of October 14, 2023, for approval or veto.

This development follows the New York Department of Financial Services’ introduction of new standards governing the listing and delisting of tokens on trading platforms. These state-level actions underscore the growing influence of individual states in shaping cryptocurrency regulations due to the absence of federal guidance.

The proposed California bill has sparked concerns within the cryptocurrency industry regarding potential cost hikes and product restrictions. Notably, the bill demands full reserves for “stablecoins,” tokens usually pegged to the dollar, potentially prohibiting algorithmic stablecoins that maintain a one-to-one value with the dollar through alternative means.

Additionally, the bill would compel cryptocurrency companies to obtain licenses from California’s consumer financial protection regulator, mirroring regulations already in effect in New York.

South Koreans Own $99B in Overseas Digital Assets

According to documents released by the National Tax Service, South Koreans collectively possess a substantial sum of 131 trillion won, equivalent to $99 billion, in virtual assets situated outside the country’s borders.

Remarkably, this constitutes 70% of all overseas assets that have been officially reported. A total of 1,432 individuals and corporations officially acknowledged and reported ownership of overseas cryptocurrency accounts.

These figures are particularly significant when considering South Korea’s population, which stands at just under 52 million, as per World Bank data. It’s crucial to note that this revelation coincides with South Korea’s recent introduction of mandatory reporting requirements.

As reported by Yonhap News, the nation’s tax laws now mandate that citizens declare their overseas accounts if the balances exceed 500 million won. Official declarations of overseas accounts are scheduled to take place annually, specifically in June.

This financial transparency push is not exclusive to South Korea, as countries worldwide have been grappling with strategies to tax virtual assets effectively. In South Korea’s case, plans to tax cryptocurrency earnings are anticipated to be implemented by 2025.

Additionally, the country has hinted at the possibility of introducing taxation on airdrops, reflecting its commitment to staying current with evolving digital asset trends and regulatory measures.

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