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Asia Web3 Market Q2 Review: Regulatory Implementation Drives Substantial Progress
Asia Web3 Market Q2 2025 Review: Policy Implementation and Practical Advancement
Key Points Overview
Overview of the Asia Web3 Market in Q2: Stable Regulations, Increased Corporate Investment
Despite the shift of the Web3 market focus to the United States, major markets in Asia still deserve attention. Asia has the largest cryptocurrency user base in the world and is an important hub for blockchain innovation.
In the first quarter of 2025, regulators across Asia laid the groundwork by introducing new regulations, issuing licenses, and launching regulatory sandboxes. In the second quarter, these policy foundations facilitated substantial business activities and accelerated capital allocation. The policies launched in the first quarter were tested in the market, continuously refined, and implemented more effectively.
The participation of institutions and enterprises has significantly increased. This report will analyze the development situation of various countries in the second quarter and assess the impact of policy changes on the global Web3 ecosystem.
Overview of Major Market Development in Asia
South Korea: Intersection of Political Transformation and Regulatory Adjustment
In the second quarter, cryptocurrency policy became a hot topic in South Korea's presidential election in June. With Lee Jae-myung's victory, the market anticipates a significant shift in policy.
The introduction of the Korean won stablecoin has become a core issue. Related stocks have surged, and traditional financial institutions are applying for Web3-related trademarks.
However, conflicts arose during the policy-making process, mainly due to disagreements over jurisdiction between the Bank of Korea and the Financial Services Commission (FSC). The Bank of Korea advocates for early involvement in the approval process, positioning stablecoins as components of the digital currency ecosystem alongside CBDCs.
In July, the ruling party announced a delay in the implementation of the "Digital Asset Innovation Act." The lack of a clear lead policy maker has become a bottleneck, and negotiations between various departments remain disjointed. Although the South Korean won stablecoin has become a focus, specific regulatory guidance is still lacking.
The system is gradually improving. The new regulations in June allow non-profit organizations and exchanges to sell donated crypto assets and settle immediately, requiring the sale to be conducted in a way that minimizes market impact.
Global exchanges continue to invest in the South Korean market. Offline activities have significantly revived, and the number of international projects visiting South Korea has increased. However, the increase in promotional activities has led to fatigue among local builders.
Japan: Institutions and enterprises adopt strategies to promote Bitcoin expansion
In the second quarter, Japanese listed companies have sparked a wave of Bitcoin adoption, primarily driven by MetaPlanet. Other companies such as Remixpoint are following suit by allocating Bitcoin.
Progress has been made in the construction of stablecoins and payment infrastructure. Sumitomo Mitsui Financial Group is preparing for the issuance of stablecoins in collaboration with Ava Labs and Fireblocks. Mercari's cryptocurrency subsidiary Mercoin has begun supporting XRP trading, enhancing the accessibility of cryptocurrencies on the platform.
Regulatory discussions continue. Japan's Financial Services Agency (FSA) has introduced a new classification system that divides crypto assets into two categories: tokens used for financing or business operations, and general crypto assets. However, these updates are mostly in the discussion phase, with limited specific amendments.
Retail investor participation remains sluggish. Japanese retail investors tend to adopt conservative strategies and are cautious about crypto assets. Even with new market participants, retail capital is unlikely to flow in immediately.
This contrasts with markets like South Korea, where retail participation directly boosts early liquidity for new projects. The institution-led investment model in Japan offers greater stability but may limit short-term growth momentum.
Hong Kong: Expansion of regulated stablecoins and digital financial services
In the second quarter, Hong Kong improved the regulatory framework for stablecoins, consolidating its position as a leading digital financial center in Asia. The Hong Kong Monetary Authority announced that the new stablecoin regulatory legislation will take effect on August 1, and it is expected that the licensing system for stablecoin issuers will be introduced by the end of the year.
The first batch of regulated stablecoins is expected to be launched in the fourth quarter. Companies participating in the Hong Kong Monetary Authority's regulatory sandbox may become pioneers.
The scope of digital financial services has significantly expanded. The Securities and Futures Commission plans to allow professional investors to engage in virtual asset derivatives trading. Licensed exchanges and funds are permitted to provide staking services.
These developments reflect the regulators' intention to establish a more comprehensive and institution-friendly digital asset ecosystem in Hong Kong.
Singapore: Regulatory tightening between control and protection
In the second quarter, cryptocurrency regulations in Singapore tightened significantly. The Monetary Authority of Singapore has completely banned unlicensed digital asset companies from conducting business overseas, indicating a firm opposition to regulatory arbitrage.
The new regulations apply to all entities providing digital asset services to global users in Singapore, effectively mandating the formal issuance of licenses. Simple business registration is no longer sufficient to sustain operations.
This puts pressure on local Web3 companies. They face the choice of establishing fully compliant operational entities or considering relocating to more lenient jurisdictions. This move aims to enhance market integrity and consumer protection, but has limited impact on early-stage and cross-border projects.
China: Internationalization of Digital Renminbi and Corporate Web3 Strategy
In the second quarter, China advanced the internationalization process of the digital renminbi, with Shanghai becoming the center. The People's Bank of China plans to establish an international operation center in Shanghai to support the cross-border application of digital currency.
There is a gap between official policy and actual operations. Although cryptocurrencies are banned nationwide, reports indicate that some local governments are liquidating confiscated digital assets to make up for budget shortfalls, suggesting that the government is adopting a pragmatic approach that differs from its official stance.
Chinese companies demonstrate a similar pragmatic spirit. Some enterprises, such as the logistics group AdanTex, have begun to increase their holdings in Bitcoin. Other companies are using Hong Kong's licensing system to bypass mainland restrictions and enter the global Web3 market, breaking through regulatory boundaries to participate in the digital asset economy.
Market interest in RMB-pegged stablecoins is growing, especially in the latter half of the quarter. The dominance of USD stablecoins and concerns over RMB depreciation have sparked discussions.
On June 18, the Governor of the People's Bank of China publicly articulated the vision for constructing a multipolar global currency system, suggesting an open attitude towards issuing stablecoins. In July, the Shanghai State-owned Assets Supervision and Administration Commission initiated discussions on the research and development of RMB-linked stablecoins.
Vietnam: Legalization of Cryptocurrency and Strengthening Digital Regulation
In the second quarter, Vietnam officially announced the legalization of cryptocurrencies, marking a significant policy shift. On June 14, the National Assembly of Vietnam passed the "Digital Technology Industry Law," recognizing digital assets and outlining incentives for fields such as artificial intelligence, semiconductors, and digital infrastructure.
This marks a historic reversal of Vietnam's ban on cryptocurrencies, making the country a potential catalyst for the widespread adoption of cryptocurrencies in the Southeast Asia region. Given Vietnam's previous restrictive stance, this move signifies a significant adjustment in the region's cryptocurrency policy.
At the same time, the government is strengthening control over digital platforms. Authorities have ordered telecom operators to block Telegram, citing that the app is suspected of being used for fraud, drug trafficking, and terrorist activities. Police reports found that 68% of the 9,600 active channels on the app are related to illegal activities.
This dual approach of legalizing cryptocurrencies while cracking down on digital abuse reflects Vietnam's intention to allow innovation under strict supervision. While digital assets are gaining legal recognition, activities used for illegal purposes are facing harsher law enforcement.
Thailand: State-led Digital Asset Innovation
In the second quarter, Thailand advanced government-led initiatives in the digital asset sector. The Thai Securities and Exchange Commission (SEC) announced a review of proposals allowing exchanges to list their own utility tokens, which is expected to enhance platform operational flexibility.
It is worth noting that the Thai government has announced a plan to issue digital bonds in the country. On July 25, Thailand will issue "G-Tokens" through an approved ICO platform, with a total issuance scale of $150 million. These tokens cannot be used for payment or speculative trading.
This initiative is a rare example of direct government involvement in the issuance of digital assets. Globally, Thailand's approach can be regarded as an early model of public sector-led tokenized financial digital innovation.
Philippines: Dual-track system of strict regulation and innovation sandbox
In the second quarter, the Philippines implemented a dual-track strategy that combines strengthening regulation with supporting innovation in the cryptocurrency sector. The government has imposed stricter controls on token listings, with regulatory authority shared between the central bank and the Securities and Exchange Commission (SEC). Registration and anti-money laundering compliance requirements for Virtual Asset Service Providers (VASP) have been significantly relaxed.
A particularly noteworthy initiative is the introduction of regulations for influencer oversight. Creators promoting cryptocurrency assets must now register with the relevant authorities. Violations may result in penalties of up to five years in prison, making it one of the strictest enforcement regimes in the region.
In addition to these measures, the government has also launched a framework to promote innovation. The Securities and Exchange Commission (SEC) has started accepting "StratBox" applications, which is a sandbox program aimed at supporting crypto service providers in a controlled regulatory environment.