:max_bytes(150000):strip_icc()/Investorlandscape2023-396e0725bd2246919e356052fb894c9b.jpg "Asia Crypto looks like a promising safe haven in the middle of winter")
Since Token2049, it has been difficult to say that the crypto industry is going through a “winter” phase. A crypto conference in Singapore in September attracted an unprecedented 20,000 people, flooding the island nation with a growing number of blockchain fans flocking to hundreds of side events across the city to avoid pricey main tickets. size
Ominous clouds hang over the US as government crackdowns on cryptocurrency giants from FTX and Ripple to Binance and Coinbase continue to weaken the industry. Washington regulators' anti-crypto stance, coupled with the Federal Reserve's hike in the federal funds rate and its impact on broader interest rates, "has had a pretty negative impact on the venture capital cryptocurrency investment ecosystem," said senior adviser Kevin Goldstein. HashKey Capital cryptocurrency, the company told TechCrunch.
In search of alternative growth paths, US crypto projects and investors have turned to Asia. “Many crypto projects in the US have opened offices, hired local talent and moved people to Asia over the past year, but there is clear evidence that many have accelerated their growth initiatives in the Asia-Pacific region over the past year due to events in the US. - Goldstein. added.
Enthusiasm for Asia is driven by growing adoption of cryptocurrencies and favorable political developments in the region. For example, the legalization of retail cryptocurrency trading in Hong Kong has attracted a number of Web3 startups to locate there in hopes of gaining access to the large investor base in mainland China, where cryptocurrencies are banned. Likewise, Singapore's application for a stable exchange rate arrangement was approved. Circle, a popular USDC stablecoin issuer in the US, gave a CEO speech at Token2049 earlier this year.
Paul Verraditakit, managing partner at cryptocurrency venture firm Pantera, told TechCrunch that Token2049 hosted the largest cryptocurrency gathering in the US that he has seen at any event in Asia this year.
“The situation has changed a bit since FTX, where there has been more regulatory research in the US, but there have also been some positive developments [in Asia] regarding stablecoin options, XRP or ETFs,” Verradittakit said. The price of the XRP token rose after Singapore granted a license to Ripple, which uses the XRP ledger to power its payment products.
“Even though FTX is having an impact on the rest of the world, I think people in Asia tend to forget about that and really see this as an opportunity to start a company, get a banking license and do things a certain way.” I'm not afraid of going to jail. “This is very important for entrepreneurs,” he said.
A glimmer of hope
The 19-hour flight from New York to Singapore was worth it for Coco Key as she believes Asia has become an attractive destination for cryptocurrency users and projects looking for talent. At the event, the blockchain-focused investor who runs Kee Global Advisors met its founder, who was moving from California to Hong Kong, where his company received funding from the city to hire local workers and rent subsidized office space.
“[Cryptocurrency project] teams are increasingly fragmented, with members located all over the world, and projects started outside the U.S. are delaying adding U.S. operations, largely to avoid potential regulatory liability,” he said.
Some U.S. cryptocurrency players that are hiring or starting to hire in Asia include Coinbase, Galaxy, Gemini, Paxos and CMT Digital.
For investors and founders still considering an Asia strategy, capitalizing on market opportunities in the culturally and demographically diverse region is key. For example, South Korean companies have successfully entered the economy with an interest in tokenomics. Japan has a wealth of TV and gaming intellectual property ripe for NFT adoption. Vietnam is gaining popularity among blockchain game developers thanks to the success of Axie Infinity. Singapore and Hong Kong, as major financial centers, have led efforts to regulate institutional crypto finance.
As with any international expansion, it is critical to have local investors or partners to support the go-to-market strategy. Fortunately, many Asian investors are interested in this new asset class.
“To attract users, you need to look for local expertise,” says Jordy Alexander, chief investment officer at crypto investment firm Selini Capital. “American or Western projects don't know how to reach these [Asian] communities because there is a language barrier. There are several social networks. For example, they have a very large Telegram group, so the way they communicate with people is very different. [In Western companies] this is not necessarily the case. It’s important to have local investors who can share their expertise with them.”
Article updated October 17, 2023 Although XRP and Ripple have a long and intertwined history, they are separate entities.