Axie Infinity co-founder suffers $9.5M loss in wallet hack

South Korean digital marketing company FSN’s subsidiary Fingerlabs has been selected as a tenant of the city of Busan’s Blockchain Offshore Firm Development Center. The company confirmed that it moved in recently on Jan. 2.Photo by Héctor J. Rivas on UnsplashFostering growth and collaborationThe Blockchain Offshore Firm Development Center is part of a project conducted by the Korea Internet & Security Agency (KISA) and the Ministry of Science and ICT and operated by Busan to create a special corporate cluster of blockchain firms, thus revitalizing the blockchain industry and nurturing a sustainable industrial ecosystem. "We are excited to be a new tenant at the Blockchain Offshore Firm Development Center,” said Kim Dong-hoon, CEO of Fingerlabs. “We will share our business know-how with other tenants and commit to joint growth. We will also actively participate in various programs provided by the center to contribute to Busan's leap into becoming a digital economy city." Various companies operating blockchain-related businesses outside of Busan were selected to be a part of the development center after a comprehensive overall evaluation of factors like technological facets, marketability and contributions to innovation. Corporate residents have access to various infrastructure and benefits, including facilities and programs at the Busan Blockchain Venture Convention, also dubbed “b-space”. Fingerlabs plans to participate in various programs led by the public sector such as councils, seminars and conferences to help Busan – notably the first regulation-free special zone for blockchain businesses in South Korea – foster its digital economy based on its expertise in the field of Web3.  Innovating Web3 solutionsFingerlabs has grown to become one of the country’s major blockchain companies through its varied services and products, which are provided to corporate clients like SK Planet, Lotte Home Shopping and SK Networks. In particular, it recently launched Bling, a participatory Web3 membership platform that allows businesses to create and manage NFTs that are linked to membership-only benefits. The company also operates a Web3 content distribution hub called Xclusive and Favorlet, an NFT wallet and customer management service. 

Crypto Influencer Arrested in Hong Kong Over JPEX AssociationHong Kong police have taken prominent social media influencer and former lawyer Joseph Lam into custody. Known as “Jolamchok” on Instagram, Lam has been arrested due to his connection with the troubled cryptocurrency exchange, JPEX.According to a report from the South China Morning Post (SCMP) on Monday, law enforcement officials conducted a search of his office, where they seized various items of potential evidence, including a plastic bag containing banknotes.Photo by niu niu on UnsplashCelebrity promotionThe Hong Kong regulator, the Securities and Futures Commission (SFC), recently issued a warning squarely pointing fingers at JPEX for actively enlisting online celebrities like Joseph Lam and over-the-counter (OTC) money changers to promote the platform’s services and products to the Hong Kong public. Hong Kong police are understood to have searched the offices of local OTC exchange service Coingaroo. That action is suspected to be related to the issues that have befallen JPEX.An unverified report suggests that Lam, who is also known as Lin Zuo, may have presented questionable investment “schemes” to a cryptocurrency investment chat group. One of the reported victims was allegedly persuaded to invest 100,000 Hong Kong dollars (approximately $12,800) in cryptocurrencies.In one instance, Lam made claims within the group, stating that people were relentlessly pursuing him for payments and that the amount of money involved was five times higher than usual.“Whatever doesn’t kill you makes you stronger”On September 17, the day before his arrest, Lam shared a news article on his Instagram account, suggesting that he had not been negatively affected by the JPEX investigations. The caption read, “Whatever doesn’t kill you makes you stronger.”Following this development, Lam visited the police alongside his legal representatives to provide the necessary information regarding his involvement with JPEX. In a related development, another crypto influencer, Chen Yi, is understood to have been arrested. Yi is suspected of conspiracy to commit fraud.Liquidity crisisJPEX has publicly attributed its liquidity crisis to regulatory pressures and “third-party market makers.” In response, the exchange increased withdrawal fees and suspended certain operations. They have, however, promised to restore liquidity from third-party market makers promptly and gradually return withdrawal fees to normal levels, with details to follow after negotiations.JPEX maintains that it was being treated unfairly. The exchange also said that it would freeze new trades while existing trades would continue to be active until completion.This arrest and the ongoing issues surrounding JPEX come amid wider concerns in the cryptocurrency sector. A recent report from Bitfinex indicated that capital outflows from the crypto markets amounted to a staggering $55 billion in August alone. This substantial outflow has not only impacted Bitcoin but has also affected the liquidity of Ether and stablecoins, underlining the broader challenges faced by the crypto sector.As the investigation into Joseph Lam’s involvement with JPEX continues, it remains to be seen how this development will impact the ongoing troubles facing the cryptocurrency exchange and the broader crypto ecosystem in Hong Kong and beyond.

Hang Seng Ponders Crypto Product OfferingHang Seng Investment Management Co., the largest exchange-traded fund (ETF) manager in Hong Kong, is considering entering the decentralized ecosystem.According to a report in local news media in Hong Kong on Wednesday, Li Peishan, the firm’s Director and Executive President, stated that Hang Seng is paying close attention to the development of digital assets. She clarified that the company is examining the possibility of including digital assets within its existing investment product offering.Photo by Jonathan Borba on UnsplashCrypto ETF expansionThis news comes shortly after HSBC, one of the largest banks in Hong Kong, introduced Bitcoin (BTC) and Ethereum (ETH) ETFs to its customers, becoming the first bank in the region to do so. This development has opened up possibilities for greater cryptocurrency adoption in the area.While most people in the space recognize that the authorities in the US have gone too far in their clampdown on the digital assets space, it’s interesting to note that recent weeks have seen a plethora of established TradFi players filing Bitcoin spot ETF applications. That list includes the world’s largest asset manager, BlackRock, multinational financial services firm Fidelity Investments, WisdomTree, VanEck, and others.Assessing potentialPeishan stated that while the company does not have a specific plan to develop a crypto ETF, Hang Seng is actively assessing the potential of incorporating digital assets into their existing investment products. She highlighted the remarkable growth in the average daily asset management scale, which has surged by 80% since December and has surpassed HK$12 billion.On June 24, Leung Fung Yee, the CEO of the Securities and Futures Commission of Hong Kong (SFC), emphasized the importance of crypto service providers embracing the next generation of the web and finance. He expressed Hong Kong’s ambition to establish itself as the central hub for crypto companies, fostering innovation within the region.Responding to Yee’s statement, the Hong Kong Virtual Assets Consortium (HKVAC) announced the inclusion of XRP, SHIB, and ADA in its newly developed HKVAC index. The creation of the HKVAC index aims to assist investors in analyzing the potential of cryptocurrencies and gaining insights into their prospects.The digital assets landscape in Hong Kong is evolving rapidly, driven by increasing interest in the asset class and the recognition of their transformative potential. Hang Seng Investment Management’s exploration of the decentralized ecosystem signifies the growing demand for exposure to cryptocurrencies among traditional financial institutions.TradFi IntegrationThe introduction of Bitcoin and Ethereum ETFs by HSBC represents a significant milestone in the adoption of cryptocurrencies within the traditional banking sector. This recent indicator from Hang Seng suggests that we are likely to see more developments unfold within the ETF space in Hong Kong in the not-too-distant future where digital assets are concerned. That view is further endorsed by the findings of a recent report produced by the Hong Kong Stock Exchange, pointing to the yet-to-be-realized potential of crypto ETFs.As the industry continues to mature, the integration of digital assets into traditional investment products is likely to become increasingly common, leading to a more diversified and inclusive financial ecosystem.