South Korea’s GDAC Suffers $13M hack

Temasek Cuts Pay Following FTX AutopsySingaporean state-owned investment firm, Temasek Holdings, has announced a reduction in compensation for executives responsible for the company’s investment in the now-defunct cryptocurrency exchange FTX. Temasek, once the second-largest outside investor in FTX, faced scrutiny after the collapse of the exchange.Photo by Emilio Takas on UnsplashNo misconduct findingOn May 29, Temasek released a statement confirming the completion of its internal review of the $275 million investment loss incurred from FTX. The review determined that there was “no misconduct” within the company. However, both the investment team and senior management took “collective accountability” and experienced a reduction in their compensation.While acknowledging the inherent risks associated with any investment, Temasek emphasized the importance of continuing to invest in new sectors and emerging technologies to understand their potential impact on the business and financial models of existing portfolios. They recognized the need to adapt to an ever-changing world and explore avenues that could drive future value.It’s worth noting that the $275 million loss from the FTX investment constituted only 0.09% of Temasek’s portfolio value, which stood at over $293 billion at the time of the collapse.Temasek maintained that it conducted extensive due diligence before investing in FTX, emphasizing its commitment to a thorough review process. Chairman Lim Boon Heng stated in a May 29 interview with Bloomberg that there was fraudulent conduct intentionally hidden from investors, including Temasek. The negative outcome of the investment has been disappointing for the company and has had a significant impact on its reputation.Reputational damageSingapore Deputy Prime Minister Lawrence Wong echoed similar sentiments, highlighting the financial loss and reputational damage caused by the FTX collapse during a parliamentary meeting in November 2022.During the due diligence process, Temasek reviewed FTX’s financial statements, assessed regulatory risks related to financial service providers in the cryptocurrency market, and sought legal advice. The company also engaged with individuals who had firsthand knowledge of FTX, including employees, investors, and industry participants.In recent news, Temasek addressed and dismissed rumors about a $10 million investment in Array, a developer of algorithmic currency systems based on smart contracts and artificial intelligence. The company clarified that such reports were incorrect, refuting the circulating news articles and tweets.Temasek’s internal review process is certainly a move towards transparency and accountability. It indicates a willingness towards addressing the matter. That said, there are FTX creditor groups who fervently disagree with Temasek’s analysis.Class action lawsuitEarlier this year a number of FTX creditors filed a class action lawsuit against a number of venture capital (VC) firms, including Temasek. The FTX customers maintain that Temasek and others played a role in a conspiracy to defraud them. Venture capital firms have countered with the view that they themselves were victims as a consequence of the FTX collapse, suffering multi-million dollar losses.The fact remains that VCs get much further involved than merely handing over a check. They get involved with marketing, operations, and many other facets of the businesses of their portfolio companies. Meanwhile, other creditors suggest that Temasek has a responsibility to do right by the 1.4 million FTX creditors (a disproportionate number of them being Singapore-based) and to invest in a restructured FTX business, an option that represents the best opportunity for FTX customers to recover their funds.Temasek may have reached certain conclusions by way of their internal report on the matter but this is not likely to be the final analysis relative to its involvement in the fall of FTX.

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.

Nexon Korea Intensifies its Blockchain Focus with Nexon UniverseSouth Korean gaming giant Nexon Korea is moving its dedicated blockchain division to its recently renamed subsidiary, Nexon Universe. According to local news outlet Newsis, this subsidiary, initially known as Nexon Block and founded last year, will welcome approximately 80 employees from the parent company’s blockchain group. The leader at the helm of Nexon Universe will be Kang Dae-hyun, who serves as the Chief Operating Officer (COO) at Nexon Korea.Photo by Shubham Dhage on UnsplashNFT-powered MapleStory UniverseNexon Korea’s blockchain division has so far been overseeing the MapleStory Universe project, an NFT-powered ecosystem that utilizes MapleStory’s intellectual property.The objective of MapleStory Universe is to establish an environment that facilitates the seamless movement of NFTs, which represent in-game characters and items, throughout its ecosystem. Beyond this, the project is dedicated to forging connections with other NFT initiatives, aiming to become part of the broader global blockchain community.In August of last year, COO Kang participated in a blockchain conference to highlight Nexon’s ongoing transformative endeavors. The transition of offline games to online platforms marked Nexon’s first evolution, while the second ambition revolves around the expansion of its gaming ecosystem using the capabilities of Web3, Kang said.Turning in-game items into NFTsAmong these strategic moves is the development of MapleStory N, the first game within the MapleStory Universe. This desktop-based MMORPG is currently under development and incorporates blockchain technology. MapleStory N will allow gamers to earn items during gameplay, which can subsequently be transformed into NFTs. The fees collected from in-game economic interactions will be distributed as rewards to both contributors within the MapleStory Universe ecosystem and Nexon.Nexon’s blockchain collaborationsAs part of the MapleStory Universe creation, Nexon joined hands with Ethereum scaling blockchain protocol Polygon. In particular, Nexon employs a Polygon Supernet, which empowers developers to tailor a blockchain to suit their gaming requirements.Furthermore, Nexon made its entry into the realm of Japanese gaming blockchain Oasys in April, acting as a validator. Oasys, established in February of last year, aims to popularize play-to-earn (P2E) games. Notable validators include Bandai Namco Research, Sega, Ubisoft, Yield Guild Games, KDDI, and Softbank.Adding to its array of collaborations, Nexon forged a memorandum of understanding (MOU) with blockchain wallet company Haechi Labs in May, within the context of the MapleStory Universe undertaking. Nexon Korea’s strategy includes leveraging Haechi’s “face wallet,” which simplifies the process of establishing and overseeing blockchain wallets for users. This is expected to offer a seamless and user-friendly experience for newcomers to the field.