Upbit Singapore Gains In-Principle Approval for Major Payment Institution License

Singapore-regulated Telcoin, a developer of financial applications for mobile users, has successfully restored user balances following an exploit that saw approximately $1.2 million worth of funds transferred from affected accounts.Photo by Martin Sanchez on UnsplashUnauthorized withdrawal of assetsThe incident, which occurred in late December, was attributed to an error in the interaction between Telcoin's digital wallet and a proxy contract on Polygon. In a blog post which was published on Wednesday, the company shared a full post-mortem analysis report which it commissioned Hong Kong-based blockchain security firm BlockSec to carry out, relative to the exploit. The fault in the proxy contract's implementation caused a technical conflict that allowed for the unauthorized withdrawal of assets. Fortunately, no admin keys were compromised, ensuring that the broader Telcoin ecosystem remained unaffected. In response to the security breach, Telcoin took action by immediately freezing the use of its application as a precautionary measure. The team initiated an investigation and committed to releasing updates promptly to address the issue and restore normalcy. The identified address associated with the exploit was 0x35d2775e5f95596509951b140d68fc5b9185ff98. TEL token freefallDespite the initial market turbulence, with the price of the Telcoin (TEL) token plummeting, the cryptocurrency has demonstrated resilience. On Dec. 25, TEL fell from a peak price of $0.00235146 to $0.00122535, representing a 48% decrease. At the time of writing, the price has slightly rebounded, trading at $0.001335. Nevertheless, it's still down 40% over the course of the past month's trading. In a social media direct message to CoinDesk recently, Telcoin's founder and CEO, Paul Neuner, expressed pride in how his team responded to the issue, stating: “Making the decision to preemptively restore affected user wallets from our company treasury was a no-brainer, and I’m proud of the team for making that happen in record time.” Regulatory standingTelcoin's regulatory standing played a crucial role in instilling confidence during this challenging time. Although headquartered in Tokyo, the company is regulated in Singapore as a Major Payment Institution (MPI) by the Monetary Authority of Singapore (MAS). The firm is also registered and regulated in other global markets, including Canada and Australia. Telcoin maintains offices in Singapore, Tokyo, Dubai and Los Angeles. The company had been active in trying to shape regulation in the United States in 2023, with company executives having made repeated visits to Washington D.C. to meet with Financial Services Committee members and staffers on Capitol Hill. In April of last year, the company extended its service offering to the European market, starting out initially in Lithuania.It appears that the restoration of Telcoin's application services led to a significant boost in user confidence. The company reported a 400% increase in deposits compared to the previous month. Users responded favorably to Telcoin's swift resolution of the security breach, with a ratio of $3.60 being deposited for every $1 withdrawn in the first day since the service restoration. Telcoin's measures, collaboration with security experts and the surge in user deposits appear to have resulted in a resilient recovery. The saga highlights the importance of prompt and transparent responses in maintaining trust in the face of crypto security issues.  

Crypto Travel Rule solutions provider CODE obtains ISO/IEC 27001 certificationCODE, a Travel Rule solutions provider and joint venture co-founded by Korean cryptocurrency exchanges Bithumb, Coinone and Korbit, announced on Tuesday (local time) that it has obtained ISO/IEC 27001 certification for information security management systems (ISMS).Photo by Scott Graham on UnsplashEnhanced cybersecurity and operational resilienceThe ISO/IEC 27001 is a standard by which companies can develop, implement, maintain and improve their ISMS to carry out robust risk management, cybersecurity and operational excellence as required by institutions like the European Union’s General Data Protection Regulation (EU GDPR).“CODE will provide a service environment that encourages confidence in our corporate members and the overall market starting with the acquisition of this information security management system certification,” said Lee Sung-mi, CEO of CODE.Consecutive effortsAs a Travel Rule solutions provider, CODE has been ramping up efforts to strengthen its compliance and information security capabilities. The company’s ISO/IEC 27001 certification comes shortly after it obtained ISO 37301 certification from the Korea Compliance Initiative (KCI). ISO 37301 is a standard for compliance management systems (CMS) that assesses organizations based on their compliance with laws, regulations, codes of conduct and more to exercise good governance, transparency and accountability.

In an interview with local media, Hong Kong legislator Johnny Ng called for the Chinese autonomous territory to implement a national Bitcoin reserve. Ng made the comments in a discussion with Hong Kong-based state-owned Chinese language media outlet, Wenweipo. The legislator believes that there is an opportunity for Hong Kong to take advantage of China’s “one country, two systems” approach to governance, which gives it the freedom to implement such a reserve despite mainland China remaining much less enthusiastic where Bitcoin and cryptocurrencies are concerned.Photo by Kanchanara on UnsplashSpot Bitcoin ETF impactThe Hong Kong Legislative Council member suggested that as a first step, Hong Kong needs to assess the impact that spot Bitcoin exchange-traded funds (ETFs) in the United States have had. Spot Bitcoin ETFs were launched in the U.S. in January. The leading spot Bitcoin ETF, IBIT, provided by asset manager BlackRock, has achieved a growth rate five times faster than any other ETF launched in the past. El Salvador and the Kingdom of Bhutan are examples of nations that have made Bitcoin a significant component within their national reserves. A recent report suggests that El Salvador currently holds 6,000 Bitcoin which it purchased at an average price of $45,465. In November, Arkham Intelligence reported that Bhutan was holding Bitcoin with a dollar value which had exceeded $1 billion at that time. Ng also referred to a move by individual states in the U.S. towards holding Bitcoin as a reserve asset. In August, the state of Wisconsin increased its holdings of shares in BlackRock’s spot Bitcoin ETF, IBIT. Last month, the state of Pennsylvania introduced a bill to make Bitcoin a strategic asset. Ohio has proposed similar legislation while Alabama’s State Auditor, Andrew Sorrell, has suggested that his state should establish a Bitcoin reserve. Reducing price volatilityNg believes that furthering the Chinese autonomous territory’s dealings relative to Bitcoin could prove beneficial, given that Bitcoin has the potential to play a role in attracting more talent and investment to Hong Kong. Additionally, he feels that the development of Bitcoin reserves at state level could help in reducing the price volatility of the asset as it goes through the process of global adoption. The Hong Kong lawmaker also believes that there is an opportunity for the Chinese antonymous territory to benefit from first mover advantage, stating that “the value of Bitcoin will be more stable, causing more and more other countries to follow suit and reduce their holdings of traditional assets.” Ng's latest interview follows a similar comment he made on X in July, where he suggested that Bitcoin is worth considering as an official financial reserve for a country. David Bailey, CEO of Bitcoin Magazine, took to X stating: “Hong Kong making moves, SBR here we go. President Trump must make the Strategic Bitcoin Reserve his top priority the day he enters the White House.”In recent days, soundings from Japan and Russia suggested that neither of these countries was prepared to establish Bitcoin reserves. However, just like with the advent of the Bitcoin ETF in the U.S., following Trump’s expression of interest in the establishment of a strategic Bitcoin reserve, the level of consideration of the matter has increased considerably among governments around the world.