One of South Korea’s largest cryptocurrency exchange is planning to launch its own initial coin offering (ICO) this year. According to local media, the token sale will be administered in Singapore, one of the most attractive jurisdictions for ICOs.
Launch of Bithumb Coin
Bithumb is in the early stages of developing a native token that will be used as a trading instrument on the digital currency exchange. According to local and international media reports, two versions of the token, dubbed Bithumb Coin, will be launched.
Reports indicate that the token sale will not be available to the general public but to targeted investors. This is a similar model employed by several large prominent crowdfunding campaigns, such as Telegram, which has now raised at least $850 million out of what’s expected to be a multi-billion-dollar deal.
Several digital currency exchanges offer native tokens, which provide much-needed liquidity boosts and allow traders to carry out easier transactions more seamlessly. Some exchanges, such as Binance, offer lower fees for trading in the native token. The most recent example of an exchange-issued cryptocurrency is Huobi, which announced plans to launch Huobi Token (IT) on Ethereum. HT issuance will be capped at 500 million units.
At present, Bithumb has not provided a timetable for when the token will launch, although it is generally believed to be commencing later this year.
Bithumb is one of the world’s largest crypto exchanges by total volume. On Saturday, the exchange processed nearly $1.3 billion worth of cryptocurrency trades with the vast majority of transactions quoted in South Korean won.
Circumventing Local Restrictions
While South Korea has become a major center for cryptocurrency trading, companies are barred from raising money via ICOs. The government banned the controversial crowdfunding model back in September before broadening its investigation of the broader cryptocurrency arena.
Singapore, on the other hand, is now considered an emerging hub for ICO transactions thanks to supportive government policies and favorable tax rules. Not only does the Monetary Authority of Singapore not regulate cryptocurrency, it “welcomes them as an innovation that can potentially reduce the cost of financial transactions,” according to guidelines published by the agency back in November.
However, MAS has recently indicated that it will assess additional rules within its existing cryptocurrency framework to safeguard investors. At the present time, MAS only regulates crypto-market intermediaries, like exchanges and remittance companies.
Although South Korea is no longer agnostic toward ICOs like many of its counterparts, local financial authorities are exploring Know Your Customer and Anti-Money Laundering protocols that could be used to better enhance the token sale process.
Source : ICOnow