After the FTX crisis, Busan will reevaluate its plans for a local cryptocurrency exchange. The FTX implosion may go down in history as the worst crypto crash. The infection has spread throughout the cryptocurrency sector and host communities in only one week.
The Background
Mentioning the possibility of some crypto-focused businesses closing down because of the crisis is terrible. Crypto specialists predicted that the digital asset market would take a long time to recover from the damage. The second-largest city in South Korea, Busan, started a blockchain project around four years ago, and the FTX epidemic has also spread there. The city established a reputation as South Korea's blockchain metropolis through its enthusiastic acceptance of bitcoin technology.
The Rise and Downfall
Supporter Of Blockchain And Cryptocurrency Innovations in Busan
August saw The local government start working with the now-defunct FTX digital asset exchange. The collaboration aimed to establish a local digital asset exchange to support blockchain development (1). Busan wants to develop as an Asian hub for digital assets as a consequence. According to a local newspaper (2), Busan is now reevaluating its alliance with FTX in light of the collapse of the cryptocurrency exchange. In light of the FTX debacle, the concept of a public-private digital exchange worries the Busan administration and financial regulators.
After the FTX crisis, Busan will reevaluate its plans for a local cryptocurrency exchange. According to a city official, given the current circumstances, it is unrealistic for Busan to continue creating a digital asset market. The city has established a local digital asset exchange in recent months. It established several alliances with cryptocurrency exchanges, including Binance. The action was the consequence of Mayor Park Hyung-Joon of Busan's commitment to lessen the city's reliance on tourism and promote the development of innovative technology.
As part of our goal in providing transparency around this week’s market events, the Genesis derivatives business currently has ~$175M in locked funds in our FTX trading account. This does not impact our market-making activities.
— Genesis (@GenesisTrading) November 10, 2022
What's to be expected next?
Huobi Global (3), a cryptocurrency exchange, and Busan have cooperated. Since 2019, the digital asset exchange has had a presence in South Korea. Busan entered into a new collaboration with Crypto.com as it pursues its goal of becoming a blockchain hub. Additionally, a pact was struck with Binance to enable a regulatory-free environment for blockchain enterprises.
Busan Will Keep Using Blockchain; a City Official Declares that in 2019, the South Korean city formally established itself as a blockchain technology-free zone. It embraced blockchain technologies as a consequence in a variety of industries, including finance, public safety, logistics, and tourism. In late 2019, Busan created blockchain-based digital money in collaboration with the massive telecom company KT.
Busan has participated in several initiatives to further its blockchain program. One of them is the partnership with local digital wallet firm Hyundai Pay. It has created a virtual power plant that is supported by blockchain. The city is abandoning its aspirations to establish a regional digital asset market, but it is still moving forward with its blockchain projects. A municipal official declared that leveraging their status as the blockchain regulation-free zone; they will investigate various options for turning Busan into a financial hub.
