Polymesh’s APAC Digital Asset Regulation Report Highlights Challenges

The Singapore Police Force (SPF) and the Cyber Security Agency of Singapore (CSA) have jointly issued an advisory to raise awareness about the escalating use of cryptocurrency drainers in cyberattacks. The advisory aims to inform citizens about the threat and provide recommendations to protect against such attacks, with a specific emphasis on utilizing hardware wallets for enhanced security. Cryptocurrency drainers represent a form of malware that specifically targets crypto wallets. These malicious tools are often employed in phishing attacks to illicitly extract funds from users' wallets without proper authorization.Photo by Junrui Wu on UnsplashDrainer-as-a-service threatOf particular concern are commercial crypto draining kits, which empower less experienced cyber-criminals with sophisticated malware at no upfront costs. Operating on a drainer-as-a-service (DaaS) model, attackers share a predetermined percentage of the stolen funds with the service provider. The SPF and CSA underscored that crypto-drainer-related attacks typically originate from phishing campaigns. These campaigns commonly involve infiltrating verified social media accounts or dispatching fraudulent emails to users from compromised databases of major service providers. Unsuspecting victims who click on phishing links are redirected to counterfeit trading websites that prompt them to connect their Web3 wallets. Subsequently, a malicious smart contract is injected into the victim's system, enabling hackers to withdraw funds without additional authorization. MS Drainer and Inferno DrainerWhile no such attacks have been reported in Singapore to date specifically, the advisory acknowledges the rising recognition of this threat among hackers. Notably, an off-the-shelf crypto drainer called MS Drainer contributed to hackers stealing $59 million worth of cryptocurrency in 2023. Last month, Singapore-based cyber security firm Group-IB produced a report concerning the Inferno Drainer operation. According to the company’s research, the malware operation led to the theft of $80 million in digital assets globally, until the developers behind it shut it down last November. In December, the Pink Drainer hacking group notched up another victim, to the tune of $4.4 million in LINK tokens. Last week blockchain security firm Scam Sniffer reported that $10 million in digital assets had been stolen in phishing-related incidents over the course of just five days. Hardware walletsTo counteract these threats, Singapore authorities recommend the use of hardware wallets as a security measure against wallet drainer attacks. Additionally, the advisory instructs crypto investors to conduct thorough research before engaging with cryptocurrency services or platforms. Singaporeans are encouraged to report any suspicious incidents related to crypto drainers or phishing attacks to both relevant authorities and crypto service providers. In the event of a security breach, victims are urged to revoke any suspicious token approvals and promptly transfer their remaining funds to a different, secure wallet address to prevent further losses. This proactive approach aims to empower individuals with the knowledge and tools needed to navigate the risks associated with crypto drainers and foster cybersecurity awareness within the cryptocurrency ecosystem. As the threat landscape evolves relative to digital assets, this advisory serves as a valuable resource to educate citizens about the risks posed by crypto drainers.  

Bybit Overhauls Institutional Trading Platform Bybit InstitutionalDubai-headquartered crypto exchange Bybit has announced the launch of its newly revamped institutional trading platform, Bybit Institutional.Bybit outlined details of the refreshed product offering which the company hopes will provide institutional clients with an elevated trading experience, via a blog post published to its website on Wednesday.The revamped Bybit Institutional platform claims to have introduced a host of new features that it hopes will distinguish it from competitor offerings:Photo by Gerd Altmann on PixabayLiquidityThe platform claims to be one of the largest in terms of open interest for crypto derivatives trading. This position allows for high trading volumes, creating frequent opportunities for clients to enter and exit positions. This heightened trading activity allows clients to execute orders without causing significant market price fluctuations.Asset safetyFollowing the spectacular failure of a number of crypto platforms in 2022, a lot of emphasis is being placed on client asset safety in 2023. Proof of reserve audits has been adopted by some platforms as a direct response to these failures. Bybit Institutional is offering that fail-safe in an effort to demonstrate that it maintains cryptocurrency reserves to cover all client holdings.Between routine audits, the use of robust security frameworks, multi-factor authentication, encryption, and other measures, the platform feels that it is prioritizing the security of client assets. Moreover, clients are also offered the option to utilize third-party custodial services for off-exchange settlement of trades and long-term asset storage.Fee structure optimizationThe platform is offering a fee structure that it claims to have tailored to maximize cost-efficiency for institutional traders. A customized fee schedule has been incorporated, based on trading volumes and strategies, and aimed at supporting institutions’ objectives of reducing trading costs while optimizing their returns.Eugene Cheung, Vice President and Head of Bybit Institutional, expressed his enthusiasm for the platform’s refreshed product offering, stating:“We are thrilled to introduce the new Bybit Institutional page, designed to cater specifically to the needs of our institutional clients. With our deep liquidity, commitment to asset safety, and cost-efficient fee structure, we aim to provide a seamless trading experience for institutions of all sizes.”Bybit Institutional has partnered with significant players within the industry in bringing its offering to market, such as Fireblocks, Copper, and Circle.Blockchain LifeThe United Arab Emirates-based exchange is also a participant in next week’s Blockchain Life 2023 event in Dubai, the 11th international forum on cryptocurrencies, blockchain, and mining. Cheung will participate as one of the panelists at the event on October 24. Titled “Crypto Market Outlook: Insights and Forecasts From Top Crypto Exchanges,” the panel of industry experts will delve into the current crypto landscape, emerging trends, and future forecasts.Bybit’s launch of the enhanced Bybit Institutional trading platform is indicative of the interest that exists between a range of market participants in cornering institutional business. UK bank Standard Chartered, through its Singapore-based subsidiary Standard Chartered Ventures and portfolio companies Zodia Custody and Zodia Markets, is also making a concerted effort to muscle in on this market segment.

Mohammed AlKaff AlHashmi, co-founder of the HAQQ Network, has expressed the view that Indonesia has considerable potential to establish itself as Asia’s largest crypto hub. AlHashmi made the comments in a discussion with Crypto.news. HAQQ Network claims to be a scalable proof-of-stake-based blockchain, capable of high throughput. The network is fully compatible and interoperable with Ethereum. The project also focuses on the development of a Sharia-compliant Web3.  While the project is headquartered in Niqa Al Dheeb in the United Arab Emirates (UAE), Indonesia is also a significant market for the company, given that it has just received regulatory approval for the HAQQ Network’s native token from the Indonesia Financial Services Authority (OJK). Islamic Coin (ISLM) is the network’s native token. It is being offered as a Sharia compliant digital currency, with Sharia law being the Islamic legal system that governs the lives of millions of Muslims throughout the world.Photo by Nick Agus Arya on UnsplashGateway marketOffering his thoughts on the Indonesian crypto market, AlHashmi stated: “When we look at Indonesia as a market, I would say it is incomparable. It can be number one to be honest. Because I have seen statistics of growth happening in a very big volume. The volume of trade, transactions and users, I think Indonesia can be very soon one of the top 3 countries in the world.” Indonesia takes on added importance for the HAQQ Network project. The project’s co-founder sees the Southeast Asian nation as a gateway into a broader market given that it has the largest Muslim population in the world. He said that if his project is successful in Indonesia, then there will be no barrier to enter markets in other predominately Muslim nations. The entrepreneur believes that Indonesia is on the cusp of realizing its potential within the crypto sector. He said that Indonesia has a “competitive edge” when compared with other nations. Population size and rapid economic growth feed into that potential, with AlHashmi claiming that Indonesia is primed to become the largest crypto hub in Asia. Smooth regulatory processFrom a regulatory perspective, he also feels that Indonesia is outperforming other jurisdictions. The HAQQ Network project team experienced a smooth process in acquiring regulatory approval for ISLM recently. He believes that although the process was detailed, it was completed quicker than he would expect in other countries.  AlHashmi added that “regulations are flexible enough to enable project owners to do good business to protect the community as well.” Local regulator, the OJK, has expressed an interest in exploring the development of Sharia-compliant crypto assets. Earlier this month, Hasan Fawzi, OJK's executive head overseeing crypto assets supervision, told local media that the regulator is open to advancing Sharia-based cryptocurrencies.  Hasan stated: “Globally and regionally, this is a common practice. It is not unusual to create crypto assets that adhere to Sharia principles.” The OJK executive is particularly interested in tokenization of real-world assets (RWAs). He believes that if this proves to be successful, it could lead to further Sharia-complaint crypto products being launched. The OJK is currently testing tokenized RWAs within a sandbox environment.