South Korea: Busan eyes transformation into blockchain hub with Huobi tie-up

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Busan, South Korea’s economic pulse, has struck an agreement with Huobi Global and Huobi Korea to revamp the city’s distributed ledger infrastructure. Huobi Global made the announcement via a press release on Wednesday, confirming that a memorandum of understanding had been signed.

“The City of Busan is pleased to partner with Huobi to foster the growth of our blockchain ecosystem,” said Busan Mayor Park Heong-joon. “As a blockchain regulation-free zone, Busan offers a conducive environment to develop the latest digital financial technologies, which has attracted many companies from across the world.”

The partnership will see Huobi leverage its deep expertise in the sector to provide research and development opportunities for the fledgling industry. Furthermore, Huobi Global has pledged support for the newly established Busan Digital Currency Exchange through funding and the establishment of a talent pool for the institution.

The newly signed memorandum between Huobi and Busan is not their first rodeo together. The global digital assets exchange had previously opened a local office in South Korea and attained a sizable customer base of residents. The firm has had to jostle for market share among other competing firms like FTX and Binance, all of whom have also set up shop in the country.

Park’s latest deal with Huobi illustrates his efforts to revamp the city’s infrastructure for digital assets and to explore new use cases to improve the lives of his citizens. The city’s efforts at being a hub have fallen below standards as a report disclosed that its “blockchain hub team consisted of fewer than five employees working out of a shared office space.”

While Busan is optimistic, the broader ecosystem cowers in fear

The collapse of Terra in May triggered an inquest by South Korean law enforcement agencies and regulators into local exchanges over their role in the implosion. Financial dealings were scrutinized, and impromptu raids were carried out to uncover any impropriety.

The effects of law enforcement efforts have no doubt dampened investors’ enthusiasm in the country’s digital assets industry. There are widespread reports that South Korean authorities are doubling efforts to capture Terra founder Do Kwon, with the latest being plans to invalidate his passports and four others.

As regulators are in crackdown mode, new entrants into the ecosystem are adopting a cautious approach in a terrain that could see rules change with the stroke of a pen. Before the Terra incident, South Korea was ahead of the pack in digital asset adoption, and its government’s plans to create a vibrant metaverse hub elicited applause from far and wide.

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