With the recent appointment of former Google executive Tom Yang as Global Marketing head, centralised cryptocurrency exchange Gate.io has signalled the next phase of its global brand and expansion strategy.
While regions of interest include countries as far reaching as Turkey, Japan and Brazil, the world’s sixth-largest CEX also sees the UK and European Union as key places of growth.
Despite spot trading on digital assets is already available to UK and EU customers, Yang hopes to build “a more localised, personalised service” in the regions it intends to target.
Regulation key to expansion
Malta is seen as a stepping stone for Gate’s expansion into the European markets.
The Mediterranean archipelago has been a crypto hotspot for some years, following the introduction of a raft of crypto-friendly bills including the Virtual Financial Asset Act and the Malta Digital Innovation Authority Act.
For Yang, regulation is key to international expansion: “Regulation brings certainty and weeds out the bad actors, which will lead to a maturing market and establish crypto as a worthy alternate class of assets.”
With 27 member states in the European Union, keeping track of the regulatory idiosyncrasies of each country poses logistical risks for Gate.io and its competitors, but things may get easier down the line.
The Markets in Crypto-assets (MiCA) proposals seek to unify regulation pertaining to consumer protection, effectively bringing all 27 member states under one regulatory umbrella.
As for the UK, while the regulators are generally pro-crypto, they have sounded warnings around certain marketing practices of high-risk assets, including “refer a friend” discounts and new-joiner bonuses.
On that, Yang said: “I think the key is to discourage 'lazy marketing' and 'misleading' tactics from questionable operators.”
Future proofing
The existing regulatory challenges sound manageable, if slightly burdensome, but given the recent controversy over how Coinbase treats custodially held funds, perhaps the biggest hurdles are yet to come.
In a year that has seen customers get stung time and again by centralised crypto lenders including Celsius, Vauld and BlockFi, scrutiny over how user funds are stored and secured will undoubtedly increase.
Gate.io, for its part, recently announced its second proof-of-reserves audit, and is one of the few crypto exchanges to do so.
The first audit was conducted in May 2020 by third-party accounting firm Armanino, showing that Gate.io had user funds collateralised by Bitcoin at 104%.
Gate.io’s network token GT was changing hands at US$4.98 at the time of writing, with a market capitalisation of US$390.3mln.