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Fidelity-backed crypto trading platform OSL secures license in Hong Kong

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OSL, a major digital asset platform in Asia and a unit of Fidelity-backed BC group, has been officially licensed by the Securities and Futures Commission of Hong Kong.

According to a Dec. 15 announcement, the new license allows OSL Digital Securities to operate regulated brokerage and automated trading services for digital assets. The news comes shortly after the SFC agreed in principle to issue OSL a license in August 2020. According to the announcement, OSL has successfully undergone the SFC’s strict vetting requirements.

At launch, OSL Digital Securities’ digital asset trading platform will support major digital assets like Bitcoin (BTC) and Ether (ETH), as well as select security token offerings, or STOs.

The platform will offer insurance protection on digital assets like Bitcoin, holding the assets in client-segregated wallets. OSL will maintain know-your-customer and anti-money laundering controls to mitigate the risk of market misconduct through market surveillance, the announcement reads.

Matt Long, head of distribution and prime at OSL, emphasized that licensed companies are the future of digital assets and capital markets. The exec also stressed that OSL is the first mover globally in terms of secured regulatory approvals:

“OSL now stands apart from the competition as an innovative first mover, as the world’s only listed, SFC-licensed, Big 4 audited and insured digital asset platform for institutions and professional investors to securely onboard into the digital asset economy.”

In addition to the Hong Kong licenses, OSL has also applied to the Monetary Authority of Singapore for a digital asset license under the country’s Payment Services Act, the announcement notes.

Earlier this year, Fidelity International, a subsidiary of United States asset management giant Fidelity Investments, completed a direct investment in BC Group, a Big-4-audited company and the operator of OSL. Fidelity purchased 17 million shares for a 5.6% ownership position, reportedly investing more than $14 million in the company.



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New York authorizes first Yen stablecoin operator in the US

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New York has given the first authorization to a stablecoin backed by the Japanese Yen to operate in the U.S.

Per a Dec. 29 announcement, the New York Department of Financial Services has granted Japanese firm GMO-Z.com a charter to handle U.S.D. and Yen-backed stablecoins in New York. 

Given New York’s status as a global center, the NYDFS is the most prominent state financial regulator in the U.S. It is also one of the most aggressive. A pass to operate in New York often opens up the rest of the country. 

GMO’s charter is as a limited liability trust company rather than a full bank, the principle difference being in authorization to handle deposits. While a stablecoin operator typically needs the ability to hold reserves of the pegged asset, GMO’s charter limits its rights to hold other kinds of deposits not central to its ability “to issue, administer, and redeem” its stablecoins. 

The right to issue such non-depository charters has been a bone of contention between state regulators like the NYDFS and national banking regulators in the U.S. 

GMO president and CEO Ken Nakamura said: “We’re breaking ground with our move to issue the first regulated JPY-pegged stablecoin, which many see as a safe haven asset.” 

The NYDFS recently made changes to its famous BitLicense, including a conditional format that buddies up newly licensed firms with existing licensees. The first conditional BitLicense went to PayPal, facilitating the launch of its new crypto services earlier this fall with the help of longstanding licensee Paxos.