Chinese TV’s crypto ‘bull run’ report censored, Multichain crisis: Asia Express
News of HK legalizing crypto exchanges censored by state media after just two days, meanwhile, Multichain token plunges after police arrest rumors.
Crypto embraced then forgotten by China’s state television
On May 23, China Central Television (CCTV), the countrys government-owned broadcasting corporation creating programming for over 1 billion viewers in Mainland China, aired a short, 98 second segment regarding the adoption of cryptocurrencies in Hong Kong.
During the session, state news anchors briefed its audience on how Hong Kong regulators have made final preparations for the trading of virtual assets in the special administrative region (SAR) and will accept applications from virtual asset trading platforms. Interestingly, nothing overtly negative about cryptocurrencies was mentioned during the broadcast a sharp contrast to Chinas official policy that banned cryptocurrency mining and exchanges elsewhere in the country.
For some viewers, such as Binace CEO Changpeng Zhao, the programming represented a big deal. Zhao reports that the Chinese speaking communities are buzzling. Historically, coverages like these led to bull runs.
Unfortunately, the euphoria was short lived as Chinese authorities appear to have taken down the link just two days after the program aired. This wasnt the first time such incidents have occurred. Last month, Douyin, the Chinese version of TikTok with over 1 billion users, began publishing cryptocurrency price quotes within its in-app search index. The move stirred a major bullish frenzy among Chinese crypto users before the price quotes were removed from the app just one day later with a message stating: Unofficial digital currencies do not possess the same legal standing as fiat currencies. Please invest cautiously.”
Hong Kong finalizes cryptocurrency regulations
In addition to allowing virtual asset trading platforms to obtain proper licensing, SFC officials stated on May 23 that exchanges could also provide services to retail investors, in contrary to its guidance last May that focused on an institution-only approach.
Shortly after the announcement, cryptocurrency exchange Gate.io kickstarted its Gate.HK platform for registration and trading services in the SAR. Then, Hong Kong virtual bank ZA Bank said it would launch a virtual asset trading services for retail investors under new HK licensing regime. Now that the rules are crystal clear, the SFC wrote:
Operators of virtual asset trading platforms who are prepared to comply with the SFCs standards are welcome to apply for a licence. Those who do not plan to do so should proceed to an orderly closure of their business in Hong Kong.
Do Kwon’s bail revoked
Before the collapse of the $40 billion Terra Luna (LUNC) ecosystem in May 2022, Terraform Labs co-founder and CEO Do Kwon was known for making fun of critics based on their level of wealth compared to himself (“your size is not size.”)
However, it appears that Kwon has finally gotten into some trouble that cannot be solved by money. On May 25, the High Court of Montenegro revoked both Kwon’s, and former Terraform Labs CFO Han Chong-joon’s 800,000 euro bail and ordered their return to jail from previous house arrest. The blockchain executives were apprehended on Mar. 23 in Podgorica Airport over allegedly falsified documents after being on the run for roughly six months from an Interpol Red Notice.
Kwon faces up to 40 years imprisonment in the criminal proceedings against him in South Korea and five years in prison on the falsified charges in Montenegro. Court filings state:
In the renewed proceedings, the court will proceed according to the High Court’s grounds for termination and after that make a decision based on the proposal of the defense counsel for the defendants to accept bail. By the decision of this court, the defendant’s detention was extended. The main hearing is scheduled for June 16.
Cross-chain token plunges 30% after arrest rumors
On May 24, the token price of Singaporean cross-chain router protocol Multichain (MULTI) fell by 30% over 24 hours to trade at $4.97 apiece. The sell-off began after users reportedly abnormally long transaction times following a recent backend node upgrade that caused certain routes, such Kava, zkSync, and Polygon zkEVM to become temporarily suspended.
While the project promised that all affected transactions will arrive after the upgrade is complete investor alarm turned into a full-blown panic after one user tweeted arrest rumors. The tweet, which garnered 820,000 views, alleged without evidence, that Multichain developers had been arrested by Chinese police with $1.5 billion dollars of contract funds under control. Multichain is currently headquartered in Singapore with around $1.6 billion in total value locked.
Alfred Xu, a Multichain co-founder, quickly stated thereafter in the protocols Chinese Telegram chat that: Currently all team members are safe and sound, the main operations are proceeding as normal.
However, on May 25, Chinese blockchain news aggregator PANewsLab reported that Multichain co-founder and CEO Zhao Jun is currently unreachable. At the same time, DeJun Qian, another co-founder of Multichain, said on Twitter that while he is personally safe and sound, he too, could not reach fellow co-founder and CEO Zhao Jun.
On May 25, Binance announced that it will be suspending 10 bridge-networks associated with Multichain until it receives clarity from the development team. It has since resumed the Fantom to Ethereum Multichain bridge. The same day, Andre Cronje’s Fantom protocol ceased providing liquidity with MULTI on decentralized exchange Uniswap due to uncertainty surrounding the development team but said funds have not been sold. Approximately $777 million worth of Ethereum funds, $405 million worth of BNB Chain funds, and $100 million worth of Fantom funds are currently held with Multichain.
Memecoins come, memecoins go
After a period of crazy returns on investment and joint listings on Asia Pacific-focused crypto exchanges, the price of memecoins such as Pepe Coin (PEPE) and Milady (LADYS) have fallen by over 50% within the past two week. Though, in hindsight, this shouldnt have come as a surprise to anyone as developers of such tokens have warned that the coins they created have no intrinsic value, and are completely useless. According to a report published by cross-chain wallet developer BitKeep:
It is important to recognize that memecoins derive their value primarily from short-term hype and speculative fervor. Consequently, the likelihood of these coins retaining any significant value over the long term is relatively low. Memecoins typically exhibit remarkably short life cycles, and their popularity tends to wane relatively quickly. Therefore, it is prudent to approach memecoins as short-term investments that are best bought and sold during periods of peak popularity.