Animoca Indicates Fund Interest From Console Makers

Hong Kong Police Issue Warning as Binance Users Lose Funds to Phishing ScamHong Kong has witnessed a surge in phishing scams targeting Binance users, prompting local law enforcement to issue a cautionary advisory.Photo by Serey Kim on UnsplashCyberDefender warningThe warning was issued by Hong Kong police via its CyberDefender Facebook page on Monday. Over the past two weeks, at least 11 Binance customers in Hong Kong fell victim to phishing scams, collectively losing over $446,000 (equivalent to HKD 3.5 million). These scams primarily involve fraudulent text messages.According to Hong Kong police, these fraudulent text messages claim to be from Binance and ask users to verify their accounts by clicking on a link provided within the message. On Facebook, the warning stated:“Recently, fraudsters posing as Binance sent text messages claiming that users must click the link in the message to verify their identity details before a deadline, otherwise their account would be deactivated.”Upon clicking the phishing link and entering their login credentials to “verify” their accounts, victims unwittingly grant fraudsters full access to their Binance accounts. This modus operandi mirrors the tactics commonly employed in phishing scams.CZ chimes inBinance CEO Changpeng Zhao (CZ) also joined in the cautionary chorus, issuing a warning to customers on his X account.The crypto sector in Hong Kong has been facing challenges recently, largely related to the recent JPEX fraud case. The losses incurred from the JPEX exchange scandal have swelled to an estimated $180 million, with over 2,300 victims filing complaints with local authorities.The JPEX scandal led to multiple arrests in Hong Kong and prompted authorities to intensify their efforts against illegal crypto activities. The Securities and Futures Commission (SFC) of Hong Kong introduced regulations mandating the licensing of all crypto exchanges operating within its jurisdiction earlier this year.To date, only two exchanges, HashKey and OSL, have secured licenses under this regulatory framework. Numerous other crypto exchanges in Hong Kong have submitted license applications, but Dubai-headquartered JPEX, despite heavily promoting its application for a Hong Kong license, failed to submit an application to the local regulator. In the wake of the JPEX scandal, the SFC published a comprehensive list of companies seeking crypto licenses and expanded its list of suspicious platforms.Cyber security firm Kaspersky found earlier this year that phishing related to crypto trading is on the rise in Asia, particularly in the Philippines. Binance’s CZ has had to issue warnings where phishing is concerned on previous occasions. He did so in July when the founder of decentralized crypto exchange (DEX) Uniswap was hacked.In February of last year, CZ came out again to warn users of a massive SMS-related crypto phishing scam. Back in 2018 a serious attempt was made to compromise the credentials of Binance platform users via phishing techniques.As phishing scams continue to pose a significant threat to crypto users in Hong Kong, and with the aftermath of the JPEX debacle still reverberating through the industry, vigilance and caution remain paramount for participants in the region’s crypto ecosystem.

Standard Chartered joins China’s CBDC pilot trialsStandard Chartered Bank has joined the advanced stages of China’s central bank digital currency (CBDC) pilot trials, making it one of the world’s largest multinational banks to partake in such an initiative.Photo by Eric Prouzet on UnsplashEnabling e-CNY exchangeChina initiated its CBDC pilot trials over a year ago, with it being much further ahead of other CBDC initiatives internationally in terms of development. It has now expanded its trials to include more lenders, with Standard Chartered China becoming the latest participant.This development means that Standard Chartered Bank’s users in the Asian nation will soon have access to the digital version of the Chinese yuan by seamlessly integrating its platform with China’s dedicated CBDC app. According to an announcement by Standard Chartered Bank (China) Ltd. on Monday, the bank will be enabled, through partner firm City Bank Clearing Services Co., to offer its clients the ability to purchase, exchange or redeem e-CNY.In its announcement, Standard Chartered China’s President, Zhang Xiaolei, stated:“As an international bank rooted in the Chinese market for 165 years, Standard Chartered is optimistic about the development prospects of digital renminbi.”Joining e-CNY testing programThe e-CNY pilot testing program in China has been extended to 26 cities and provinces. Standard Chartered’s Chinese subsidiary will involve itself with supply chain financing, trade financing and cross-border merchant payments as part of that pilot program.The adoption of CBDCs is anticipated to reduce reliance on physical currency notes while ensuring transparent and tamper-proof transaction histories. China’s CBDC, known as the digital yuan or e-CNY (digital renminbi), has garnered international attention for its progressive approach to digital currency.Broader digital assets sector involvementStandard Chartered’s involvement in China’s CBDC pilot marks a milestone, emphasizing the bank’s commitment to digital innovation. However, the British banking conglomerate has had a broader approach to digital assets beyond this CBDC collaboration. A report by Nikkei Asia last month suggested that the banking group was making a concerted effort to develop its digital assets-related business within the Asian region through its Singapore-based investment arm, SC Ventures.Earlier this month, SC Ventures unveiled Libeara, a platform which plans to offer the first-ever tokenized Singapore dollar government bond fund. Subsidiary companies include digital asset custodian Zodia Custody and institution-first digital asset marketplace Zodia Markets.China has been at the forefront of CBDC experimentation, with initiatives like testing offline payment systems integrated with SIM cards. This innovative approach allows users to initiate CBDC payments by simply bringing their phones close to sale terminals. The trials, initially launched in major cities such as Shanghai, Beijing and Shenzhen, have encouraged residents to embrace e-CNY for everyday transactions.While China’s advancements in CBDC trials are noteworthy, other nations, including India, Japan and the U.S., are also actively engaged in the advanced phases of CBDC-related research and development. These global efforts seek to diversify financial settlement options, providing individuals with a broader range of choices in the evolving landscape of digital currencies.

The Legal Future of South Korea’s Crypto Industry: Necessary Legislation and SystemsA recent National Assembly symposium organized by South Korea’s Digital Asset Policy Forum brought experts together to discuss the challenges and prospects of the implementation of the Virtual Asset User Protection Act at the National Assembly Members’ Office Building in Seoul on Tuesday.Photo by Tingey Injury Law Firm on UnsplashInternational modelsReferences were made to global examples, such as the Markets in Crypto-Assets Regulation (MiCA) — the world’s first standalone virtual asset legislation enacted in the EU — which ensures transparency, disclosure, authorization, and supervision of crypto-asset transactions. However, unlike the capital market, MiCA does not impose regular disclosure reporting requirements or corrections on them. Firms in Japan, on the other hand, are asked to provide disclosure under autonomous regulation through the Japan Virtual and Crypto Assets Exchange Association (JVCEA).Notably, in its recent Policy Recommendations for Crypto and Digital Asset Markets Consultation Report, the International Organization of Securities Commissions (IOSCO) states that it is “seeking to encourage optimal consistency in the way crypto-asset markets and securities markets are regulated within individual IOSCO jurisdictions, in accordance with the principle of ‘same activities, same risks, same regulatory outcomes’.” This principle refers to the concept that any crypto-asset activity that has a similar function and poses similar risks to those in the traditional financial system — such as operating a trading platform or providing custody services — is subject to regulation that ensures equivalent outcomes, as defined by the UK Parliament.The IOSCO report also suggests that crypto-asset service providers (CASPs) should disclose information regarding ownership and control of crypto-assets, issuer and business-related information, issuer management teams, transaction history and operational description of crypto-assets, token ownership concentration, transfer protocols, and a given CASP’s treatment of the client crypto-assets and their respective rights and entitlements during events like hard forks and airdrops.Hurdles to overcomeExperts at the forum reflected these considerations in their sentiments. Han Suh-hee, a lawyer at Barun Law Firm, emphasized that it is important to determine what kind of information should be disclosed. She argued that it is necessary to discuss to what extent information about virtual asset issuers should be disclosed and whether mandating firms to disclose their financial and business conditions is efficient.In particular, Han underlined the need to consider the differences between virtual assets and stocks when establishing a framework for the disclosure of virtual assets holdings. Unlike stocks, virtual assets possess distinctive characteristics like their borderless and decentralized nature, unclear issuer backgrounds, and the ability to conduct peer-to-peer (P2P) transactions.Lee Han-jin, a lawyer at Kim & Chang Law Firm, added that the enactment of Korea’s Virtual Asset User Protection Act was aimed at establishing a system directly targeted at regulating virtual assets and virtual asset service operators (VASPs) — a significant development from the Financial Transaction Reporting Act, which had until now been the only legal framework responsible for regulating VASPs along with other entities like casino business operators. Virtual assets are now subject to a more systematized regulatory approach.However, he said that the Virtual Asset User Protection Act still has its setbacks because it is undergoing a two-stage legislative process. Lee criticized the fact that the same definition of VASPs outlined in the Financial Transaction Reporting Act had been brought over, which limits their identity to transaction intermediaries, wallet operators, and custodians while overlooking their other roles like crypto management, crypto deposits, and crypto collective investments.Lee also pointed out another weakness: the scope of prohibition on using undisclosed information and market manipulation is broader in the Virtual Asset User Protection Act than in the Capital Markets Act. He argued that enforcement decrees should stipulate the definition of insiders and exceptional cases when deliberating on the prohibition of insider virtual asset trading.Lee thus emphasized the need for a clear definition of virtual assets in the Virtual Asset User Protection Act, as it is yet unclear whether they are objects or assets. All things considered, he believes there must be a law that can encompass blockchain-based decentralization, outline the similarities and differences between digital assets and financial products, and accommodate new services that utilize smart contracts.“We are in the process of creating a regulatory system similar to those being adopted in other countries based on their respective markets,” said Lee Seok-ran, head of the Financial Innovation Bureau at the Financial Services Commission (FSC). “Unlike the stock market, which is equipped with regulations to prevent fraudulent transactions and misconduct, virtual assets are traded on multiple exchanges, so we are considering how to interpret unfair trading activities and conduct market surveillance.”She explained that the commission is prioritizing user protection measures and subordinate regulations. “I believe we will be able to create a system for subordinate regulations on disclosure once an overall global trajectory is established. But before that happens, we are working on guidelines for defining unfair trading activities with regulators and the Digital Asset eXchange Alliance (DAXA).” Unfair trading activities associated with virtual assets include not only those conducted on exchanges but also under other circumstances.The FSC officer said that the financial authority is set to establish legal criteria to distinguish cases such as false statements in white papers of crypto projects. She added that enforcement decrees will define both the conditions for restricting deposits and withdrawals on crypto exchanges and the corresponding limits.