Ava Labs, the main developer behind blockchain project Avalanche, has become the latest digital-asset firm to expand its management teams in Asia as a regulatory pushback deepens in the US.
(Bloomberg) — Ava Labs, the main developer behind blockchain project Avalanche, has become the latest digital-asset firm to expand its management teams in Asia as a regulatory pushback deepens in the US.
New York-based Ava Labs said it hired Justin Kim, a former investment banker at the Korea Development Bank, and startup veteran Roi Hirata as the heads of its business in South Korea and Japan, respectively.
“The [Korean] government is encouraging large firms to use blockchain technology to tackle operational inefficiencies and bring down the cost,” Kim said in an interview.
Japan historically has been at “the forefront” of crypto and its regulations, especially after the failure of Tokyo-based crypto exchange Mt. Gox, once the biggest Bitcoin exchange, Hirata said in an email response. Mt. Gox lost some customer assets and then went bankrupt in 2014.
Mt. Gox made “a strong foundation” for providing clarities for crypto in Japan, Hirata said. Therefore, he sees a “huge opportunity” for businesses in Japan to adopt blockchain technologies.
The moves follow key partnerships Avalanche launched in Asia and echo similar announcements from other crypto companies that are bolstering their presence in the region.
Digital-asset prime brokerage FalconX announced at the end of February that it is expanding its services into Singapore with several new hires, while Binance, the biggest crypto exchange in the world, acquired a majority stake in South Korea-based crypto exchange GOPAX earlier this year. Meanwhile, digital bank Anchorage Digital said it is slashing 20% of its staff earlier this week, citing the uncertain crypto regulatory landscape in the US as a factor.
After being hit by several industry blowups, including the collapse of the FTX exchange, the crypto sector is now being affected by concerns in the US over the solvency of a few crypto-friendly banks.
Many crypto startups in the US are struggling to find new banking partners after Silvergate Capital Corp., a go-to bank for crypto, announced a plan to wind down operations and voluntarily liquidated last week. Venture capital-focused Silicon Valley Bank collapsed later that week, while Signature Bank, another bank known for its ties with crypto, was subsequently shutdown by New York state regulators.
Ava Labs has already helped the Avalanche blockchain secure several major partnerships in Asia with companies including Alibaba Cloud and Tencent Cloud. Kim said that his focus this year is to launch new partnerships for Avalanche with conglomerates in South Korea. Avalanche, a blockchain similar to Ethereum, caught attention recently when investment giant KKR said it has put a portion of its private equity fund in a tokenized version running on Avalanche.
“Korea is actually trying to do exactly that, so that’ll grant investors new opportunities in terms of investment, but at the same time, that actually sort of lowers costs” for private equity firms, Kim said. “Korea is opening regulations and doors to a lot of those opportunities.”
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