Japanese Exchanges Canvas Regulator to Permit 10x Leverage

South Korean Prosecutors Fail to Recover Do Kwon’s AssetsSouth Korean prosecutors have disclosed that they have been unable to find the millions of dollars that Do Kwon, CEO and Founder of Terraform Labs, made from the crypto business.©Pexels/GratisographyOverseas assetsThe latest development in the case suggests that Kwon may have tried to hide his assets overseas, making it more challenging for authorities to recover those funds.Prosecutors claim that Do Kwon transferred funds from his personal accounts to overseas bank accounts under his mother’s name. Additionally, he allegedly used cryptocurrency to purchase real estate and other assets in the United States, which he then registered under his mother’s name. This tactic is commonly used by those seeking to evade detection and protect their assets from seizure.Binance halt requestSouth Korean authorities are understood to have reached out to global cryptocurrency exchange, Binance, requesting it to halt any withdrawal request associated with Kwon. Binance confirmed to CoinTelegraph that it is cooperating with the request, stating: “We provided Korean law enforcement authorities with the requested assistance. Since we cannot comment on ongoing law enforcement investigations, for any further comment please reach out to the prosecutors.”Blockchain forensicsThe situation surrounding Do Kwon’s case is not uncommon in crypto. Although there are blockchain forensic analysis specialists who collaborate with government authorities in tracing digital assets, the task is not without its difficulties. By analyzing the blockchain, investigators can trace the flow of funds and identify the individuals involved in illicit activities. This technology has already been used in a number of high-profile cases, including the 2014 Mt. Gox hack and the 2020 Twitter hack.Nevertheless, the anonymous nature of blockchain transactions makes it much easier for individuals who engage in fraudulent or illegal activities. However, as cryptocurrency becomes more mainstream, governments around the world are cracking down on those who attempt to take advantage of the system.Tightening regulationIn South Korea, authorities have been working to regulate the cryptocurrency industry and protect consumers from fraud. The government has implemented a number of measures, including requiring cryptocurrency exchanges to register with the Financial Services Commission and banning anonymous transactions. Despite these efforts, however, incidents of fraud and embezzlement continue to occur.The fight against cryptocurrency-related crime is far from over. As the industry continues to grow and evolve, criminals will continue to find new ways to exploit the system. It is up to regulators and law enforcement officials to remain vigilant and adapt to these changes in order to protect consumers and ensure the integrity of the financial system.In the case of Do Kwon, the investigation is ongoing, and it remains to be seen what the final outcome will be. Prosecutors estimate total proceeds of Do Kwon’s alleged crimes to amount to 91.4 billion won ($71 million) while 414.5 billion won ($316 million) has been identified relative to Terraform Labs more broadly.

The Philippines Forging Crypto Reg. Path US Could Learn FromThe Philippines has demonstrated best practice in operating a sensible regulatory framework relative to cryptocurrency while the United States has erred by engaging in regulation via enforcement while responding after the horse has bolted in relation to a string of crypto company collapses. That’s according to Robert De Guzman, Head of Legal Compliance at Philippines-based cryptocurrency exchange Coins.ph.©Unsplash/C BuezaIn an opinion piece published in Forkcast News on Tuesday, De Guzman lays out his view as to what’s required in terms of regulation, while drawing comparisons between the application of regulation relative to crypto in both jurisdictions.The need for “sensible” regulationDe Guzman believes that the crypto industry’s recent failures are a wake-up call for the whole sector. Losses of billions of dollars affected Celsius Network, BlockFi, Voyager Digital, Genesis, and FTX, and led to Silvergate, Silicon Valley Bank (SVB), and Signature banks’ collapse in a week. To maintain consumers’ trust, he believes that sensible regulation is necessary for the crypto exchanges dealing with digital assets.The legal compliance expert cites the FTX collapse. FTX’s Sam Bankman-Fried’s empire was among the largest collapses. FTX pretended to support regulation, but its true nature was an offshore exchange for global clients. Nonetheless, some businesses act on their regulation support by acquiring licenses and complying with central bank audits in the countries of operation.State-level and industry-level regulationThe crypto industry being open to self regulation is one element of the solution, he says. Regulators must proactively protect their consumers from scams and business failures, not just clean up the mess after millions of people have been harmed.Regulatory failuresDe Guzman points the finger at reactionary regulatory action. Regulators filed charges against crypto industry founders after their collapse. Previously, they missed the problems of the largest companies. FTX, based in the Bahamas, was mismanaged, and American regulators only responded after customer issues. Regulations by enforcement, preferred in several countries, wait for failure to happen before taking action. Over-regulation through enforcement pushes platforms offshore, where Wild West-type environments thrive, with clear consequences.Regulators in some countries focus on surface-level questions, like which tokens should be considered securities, while others, like in the Philippines, prioritize execution-level details to protect consumers. Anti-money laundering measures and custody are core issues, with the G-7’s Financial Action Task Force’s Travel Rule likely to be more strictly applied. Active regulation and audits are needed to ensure financial platforms act responsibly with customer deposits. Basic rules need to be put in place through a licensing regime, followed by regulation of market practices like commingling of assets, self-dealing, and trading against customers.The Philippines sensible approach to regulationThe Coins.ph legal guru holds out his home country as exemplary in terms of its approach to regulation. The Philippines’ regulatory regime requires a virtual asset service provider (VASP) license to operate a crypto exchange, as well as additional licenses for other services. The country’s central bank, BSP, directly regulates all crypto exchanges and expands its crypto regulations to adapt to market needs. KYC processes in the Philippines require recognition of valid ID documents from across 82 provinces.Additionally, the BSP expects the industry to cooperate in quarterly audits where they share balance sheet information and disclose digital assets in hot and cold wallets. Regulators in the Philippines are proactive and knowledgeable about the crypto space, which sets a sensible framework based on customer protection.

Korean Parliament to Hold Hearing on Virtual Assets Amid ControversiesThe National Policy Committee (NPC) of the South Korean National Assembly has reached an agreement to conduct a hearing on virtual assets next month. This decision comes following discussions between the ruling and opposition parties, as reported by local news outlet Kukinews.Photo by KS KYUNG on UnsplashHearing dateLawmakers Yoon Han-hong and Kim Jong-min, who serve as administrative secretaries of the NPC, have agreed today to hold the virtual assets hearing on July 11. Yoon is a member of the ruling People Power Party (PPP), and Kim is a member of the opposition Democratic Party of Korea (DPK).During a full session held this afternoon, Lawmaker Kim proposed the idea of a hearing on virtual assets, to which NPC Chair Back Hye-ryun agreed.Growing public interestToday’s meeting was organized to foster a better understanding of the current issues surrounding virtual assets, given the increasing public interest, particularly in light of the recent controversy involving Lawmaker Kim Nam-kook’s alleged ownership of cryptocurrency tokens and the employment of PPP leader Kim Gi-hyeon’s son in a crypto-related company.The NPC intends to finalize the plan for the hearing on June 30, just before the plenary session on the day. The specific focus of the hearing and the participants, including witnesses, will be determined through consultations between the administrative secretaries.