Bithumb and Korbit Struggle to Gain Traction Despite Zero Trading Fees

The Enforcement Directorate (ED) — an Indian law enforcement agency — seized 90 crores ($10.5 million) from an online scam app called E-Nuggets with the help of global crypto exchange Binance.  ED is the governmental law enforcement agency responsible for enforcing economic laws and with that, tackling economic crime. According to a report published by Indian English language daily newspaper The Hindu, the online gaming app E-Nugget had cryptocurrencies worth $10 million stored in 70 different crypto wallet accounts spread across the three crypto exchanges.  Local Indian exchanges ZebPay and WazirX also aided the ED in its investigations and subsequent actions. The ED contacted these exchanges to block the wallet addresses and transfer the crypto assets to the agency’s wallet. Photo by Naveed Ahmed on UnsplashCrypto assets seizedThe ED, tasked with upholding such financial crimes, spearheaded the operation against E-Nuggets, an online gaming platform masquerading as a legitimate investment opportunity. Taking to the X social media platform on April 30, the Indian law enforcement agency stated: “ED, Kolkata led a successful operation against a major “online gaming app scam” known as “E-Nugget”. The E-Nugget app, masqueraded as a gaming platform, promised users high returns on their investments. Crypto assets which were taken into possession of ED are transferred into Crypto Wallet of ED.” 70 wallets implicatedWith cryptocurrencies valued at $10 million spread across 70 different wallet accounts on three crypto exchanges, the agency swiftly took action. E-Nuggets enticed unsuspecting investors with promises of substantial returns through its purported gaming interface. However, once investments were made, the platform vanished into thin air, leaving users unable to recoup their funds. The ED's investigation revealed a complex web of deceit, with the agency seizing properties totaling over 163 crores ($19.5 million), comprising cash, cryptocurrency holdings, account balances and office spaces. The scam involved the funneling of funds into digital assets through 2,500 dummy bank accounts, resulting in the discovery of 19 crores ($2.2 million) in cash. A first information report (FIR) filed at the Park Street Police Station in Kolkata, became the catalyst that triggered the ED case that was subsequently registered under the provisions of India’s Prevention of Money Laundering Act (PMLA). Masterminded by Aamir Khan, who was apprehended alongside accomplice Romen Agarwal, the scheme operated under the guise of digital transactions, which, ironically, facilitated its unraveling. Law enforcement agencies adeptly traced, froze and seized the illicit funds as they moved through the digital realm. Public ledger upends scammersCritics often point to the potential for cryptocurrency to facilitate money laundering. However, the inherent transparency of blockchain technology presents significant obstacles to such illicit activities. Notably, in the infamous 2016 Bitfinex hack, where hackers absconded with 119,756 Bitcoin, the culprits were eventually apprehended in 2022 while attempting to launder the stolen funds. The collaborative efforts between Binance, the ED, and local exchanges points to a developing commitment towards combating financial fraud within the cryptocurrency space. This wasn’t the first occasion in which Binance had cooperated with law enforcement on such matters. In October of last year, the company got with the Thai authorities to assist them in crushing a crypto-related scam. By leveraging blockchain's transparency and international cooperation, authorities can effectively dismantle illicit schemes, safeguarding investors and upholding the integrity of the digital asset ecosystem.

The joint virtual asset crime investigation unit of the Seoul Southern District Prosecutors' Office announced the arrest of three executives from South Korean cryptocurrency yield platform Haru Invest, according to a report by local news agency Yonhap. They are accused of embezzling cryptocurrencies valued at over 1 trillion Korean won ($750 million).Photo by niu niu on UnsplashFraud lawsuitThis development comes after approximately 100 investors filed a fraud lawsuit in June against the executives of Haru and Delio, another Korean crypto lending firm.  The three leading executives of Haru, one aged 44 and the other two aged 40, are facing fraud charges for failing to return cryptocurrencies deposited by around 16,000 customers.Misleading promotionsInvestigations uncovered that Haru Invest was offering misleading promotions for its products. Despite assurances that it utilized a risk-free, diversified investment strategy to manage user assets, Haru Invest predominantly allocated the majority of these assets towards concentrated investments from March 2020 to June 2023. Haru Invest had garnered attention from crypto investors, promising an annual return of up to 12%.  Subsequently, on June 13, Haru halted the withdrawal of digital assets without prior notice. The platform is currently in the midst of bankruptcy proceedings.  Delio, having allocated some of its assets with Haru, also came under public scrutiny that same month when it ceased withdrawals just a day following Haru's questionable action.

In a press release published by Business Wire on Nov. 20, American crypto custodian BitGo announced the launch of its Singaporean subsidiary company, BitGo Singapore Pte. Ltd. The company has set out the key features that the BitGo Singapore platform intends to offer going forward. These include secure, regulated cold storage. The platform is offering digital asset custody support in respect of over 1,100 digital assets. BitGo claims that the range of assets supported far exceeds that offered by competitors in the digital asset custodian space. Photo by Joshua Ang on UnsplashRegulatory complianceIn January, the company achieved in-principle approval (IPA) relative to a Major Payment Institution (MPI) license from local regulator the Monetary Authority of Singapore (MAS). By August the company had satisfied regulatory requirements sufficiently to be awarded a full MPI license. The company will also offer clients electronic and voice trading, allowing them to access deep liquidity directly through the digital assets held in cold storage. BitGo had deployed its Go Network to effect automated settlement. It claims that the Go Network mitigates counterparty risk through the use of delivery versus payment (DVP) settlement processes, while enabling access to exchange liquidity. Token management is another area that the firm identified in its press release as a feature of its overall service. Back in September, the company rolled out a streamlined token management service for crypto foundations. Broadening APAC service offeringThe crypto asset custodian has launched this separate subsidiary in Singapore with the purpose of broadening its service offering within the Asia-Pacific (APAC) region. BitGo Singapore CEO Youngro Lee stated that BitGo is “thrilled to launch BitGo Singapore and offer the APAC region a best-in-class suite of digital assets solutions and regulated infrastructure services.”  Lee added that the new regional entity is committed to providing its clients “with the highest quality products and services while maintaining strict regulatory standards,” while also looking forward to “further strengthening the APAC digital assets ecosystem.” In expanding the reach of its service offering, BitGo has engaged in a collaborative approach. It has partnered with companies such as Vancouver-headquartered Lightning Network infrastructure provider Neutron Pay, and crypto market maker Wintermute, who announced in July 2023 the planned establishment of a base in Singapore. Taking to X on Nov. 21, Neutron Pay stated: “We're excited to announce a strategic partnership with @BitGo Singapore, paving the way for expansion of our #Bitcoin and #LightningNetwork services across Asia-Pacific (APAC).” The firm’s CEO Albert Buu said that “by leveraging BitGo's robust custodial infrastructure, we aim to enhance our ability to serve businesses throughout Southeast Asia.”  Wintermute Co-Founder Yoann Turpin offered his own thoughts on the BitGo Singapore announcement, stating: “Having recently expanded our own footprint in the region, we see strong potential for collaboration in addressing the sophisticated needs of institutional players. By working together, we aim to build a more robust environment for institutions and drive meaningful growth across APAC’s digital asset markets.” At the time of writing, 29 crypto-sector firms, including the likes of Circle, Coinbase and Blockchain.com, have acquired full MPI licenses to trade in the city-state of Singapore.