Asia is promoting crypto clarity amid regulatory uncertainty in the U.S., and this could make the region more attractive to investors, according to industry observers.

“Cryptocurrency regulations in Asia have moved along faster and with more clarity — green light or red light — than in the U.S.,” said Ben Charoenwong, assistant professor in finance at the National University of Singapore Business School.

“This has made Asia the premiere location for much of fintech innovation,” said Charoenwong.

Earlier this month, Hong Kong officially opened crypto trading to retail investors and upgraded licenses of two exchanges. HashKey and OSL can now expand their business beyond professional investors to now include retail investors.

“It shows that virtual assets are becoming a recognized asset class with a similar regulatory status as traditional asset classes,” said Lennix Lai, global chief commercial officer at crypto exchange OKX.

“This will further boost investor confidence, making Hong Kong more attractive as a potential global virtual asset hub,” said Lai. OKX is applying for a virtual assets trading license in Hong Kong.

Last year, Hong Kong said it recognizes “the potential of distributed ledger technologies and Web 3.0 to become the future of finance and commerce” and expects to enhance efficiency and transparency with proper regulation.

Rival regional financial hub Singapore has also been a frontrunner in crypto regulation. The Monetary Authority of Singapore granted Blockchain.com a license in August, an upgrade to the in-principle approval it got in October. Another player Ripple received in-principle approval in June. This means that Blockchain.com and Ripple can provide regulated crypto services in Singapore.

Meanwhile, Thailand and Indonesia have banned the use of crypto for payments, but allows it to be traded as a commodity.

"Overall, while the improving trends and fundamentals in crypto continue to sustain optimism, it's a good time to keep a close eye on any potential spillover impacts from macro to broader risk assets and, by extension, crypto," Lawant added.

Bitcoin's renewed downside volatility is consistent with its record of putting interim tops after notable rallies in meme coin SHIB. The self-proclaimed dogecoin-killer surged over 20% in the first 12 days of the month, predominantly on optimism that a layer 2 Shibarium launch would help the cryptocurrency revamp its image as a serious industry player.

Since Aug. 12, the cryptocurrency has pulled back 18%, with prices falling 9% in the past 24 hours alone amid Shibarium's turbulent start. Funding rates in SHIB perpetual futures trading on Binance have crashed to a two-month low of -0.084%, according to data source Coinglass.

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