Korean won overtakes U.S. dollar in Q1 crypto trading dominance

Singapore-based decentralized liquidity infrastructure and on-chain funding project Solv Protocol has raised $11 million in funding, bringing its total inward investment to date to $25 million. Taking to Medium on Oct. 14, the project outlined that in this most recent funding round, $11 million had been raised with participation from Nomura subsidiary Laser Digital, Blockchain Capital, gumi Cryptos Capital, OKX Ventures and CMT Digital. Angel investors associated with a number of blockchain projects such as Berachain, Ethena, Mezo, Core, GMX, Curve and EigenLayer also invested. $200 million valuationThis latest funding round was carried out while placing a $200 million valuation on the company. Going forward, the company plans to roll out additional products over the course of the next few weeks, with a view towards further expanding yield opportunities for Bitcoin (BTC) holders. Solv Protocol’s leading product, SolvBTC, was introduced to the market last March as the world’s first-ever yield-bearing Bitcoin. The protocol initially ran on Ethereum, Arbitrum, BNB Chain and Merlin Chain. Since launch, it has been expanded across 10 blockchain networks. The product claims to enable BTC holders to earn additional BTC all the while maintaining Bitcoin exposure. In excess of 20,000 BTC is currently staked within Solv Protocol’s SolvBTC product, accounting for around $1.3 billion in value. The project claims to have 400,000 users, with 80% of their assets allocated to yield-generating strategies.Photo by Traxer on UnsplashMarket opportunitySolv Protocol’s Co-Founder Ryan Chow spoke to the market opportunity that Bitcoin staking presents. Chow stated: “With a market cap of over $1.2 trillion, Bitcoin holds immense growth potential, Bitcoin’s staking rate is currently much lower than Ethereum’s 28%. If we can unlock similar levels of participation, Bitcoin staking could unlock $330 billion in value. We believe BTCFi will drive the next wave of innovation in the blockchain space.” In a series of X posts published on Oct. 14, the project pointed out that the lack of a native yield, limited integrations with core DeFi primitives and fragmented BTC liquidity relative to DeFi are key challenges for Bitcoin, which Solv claims to have resolved. Staking Abstraction Layer (SAL)Earlier this month, Solv, alongside BNB Chain, Ceffu and Chainlink, launched the Staking Abstraction Layer (SAL). SAL is a framework which has been designed to simplify and standardize Bitcoin staking across a number of blockchain networks. Key SAL features include cross-chain compatibility with Ethereum Virtual Machine (EVM) compatible chains, support for liquidity staking tokens (LSTs) and a focus on security and custody with the involvement of crypto custodian Ceffu deemed to ensure that the user’s underlying Bitcoin is secure. Solv has launched three LSTs. These include SolvBTC.BBN, an LST representing staked Bitcoin on Babylon, another Bitcoin staking platform. SolvBTC.ENA is a trading strategy involving Ethena’s basis trading. Meanwhile, SolvBTC.CORE focuses on providing Bitcoin liquidity on CoreDAO, a Bitcoin-aligned EVM-compatible layer-1 blockchain. Bitcoin staking is a more recent development which appears to have considerable potential. As Solv pointed out on X, Ethereum has a 28% staking rate right now, with Bitcoin not coming anywhere close to this figure. Staking platforms on Ethereum like Lido has $23.7 billion in total value locked (TVL) while EigenLayer weighs in at $10.9 billion.

South Korea’s southeastern port city of Busan signed a memorandum of understanding (MOU) on Wednesday with the BDX Consortium led by ITCEN GROUP, a Seoul-based tech company specializing in system integrations. This marks the beginning of the establishment of the Busan Digital Asset Exchange (BDX). Photo by Minku Kang on UnsplashPlans to establish BDX CorporationFollowing the MOU signing, Busan and the BDX Consortium plan to join forces to set up and operate BDX successfully. The two entities are also dedicated to swiftly establishing a private entity, “BDX Corporation,” within the blockchain regulation-free zone in Busan, as part of their ambitious plan to make Busan into a global blockchain hub.  ITCEN GROUP is known to have extensive experience in trading real-world assets (RWAs) such as gold, silver and copper. Other participants of the BDX Consortium include Hana Securities, Hana Bank, OCON and Barunson, who are set to provide RWAs and intellectual properties (IP) to BDX in cooperation with ITCEN GROUP. Following the founding of BDX Corporation, the BDX Consortium is required to provide investment capital to the city of Busan until April, in accordance with its business plan.  A blockchain exchange with its own mainnet based on decentralized governanceThe decentralized governance upon which BDX will operate is an independent framework capable of handling securities settlements, listing assessments and market monitoring. It also serves as an investor protection measure through its mutual check and balance system.  BDX plans to support 24/7 transactions of various assets including commodities, jewelry, IP and carbon credit, all of which will be tokenized into small units for convenient trade.  “This partnership lays the foundation for the BDX launch, which will serve as a cornerstone of the city’s plan to foster the blockchain industry. In close cooperation with local enterprises, Busan will do its best to build and operate the exchange and contribute to the city’s economic growth,” stated Park Hyeong-joon, the mayor of Busan. 

Hacking Attempts on Upbit Reach 160,000 in First Half of the YearThere have been approximately 160,000 hacking attempts on Upbit, Korea’s largest cryptocurrency exchange, in the first half of this year alone, according to a report submitted by Upbit’s operator Dunamu to lawmaker Park Sung-joong of the National Assembly’s Science, ICT, Broadcasting, and Communications Committee.“Cryptocurrency hacking incidents are increasing both domestically and internationally, and hacking attacks on exchanges such as Upbit, which have daily trading volumes exceeding KRW 2 trillion, are a serious issue,” Park said.Photo by Clint Patterson on UnsplashAn uptick in hacking attemptsThe data revealed that the number of cyber breach attempts in the first half of the year totaled 159,061–2.17 times higher than the number of attempts in the first half of last year, which stood at 73,249.Hacking attempts on Upbit have been steadily increasing in recent years, from 8,356 in the second half of 2020 to 34,687 and 63,912 in the first and second half of 2021, respectively. In the first half of last year, there were 73,249, and 87,242 in the second half. Notably, the exchange suffered losses of approximately KRW 58 billion (approximately $43 million) from a hacking attack in 2019.Ramping up securitySubsequently, Dunamu has taken action to enhance security by managing over 70% of its assets in cold wallets and operating hot wallets in a distributed structure instead of a singular one. Hot wallets refer to online crypto wallets, whereas cold wallets are crypto wallets that are offline and disconnected from the internet. Hot wallets offer the advantage of direct deposits and withdrawals, but they have weaker security levels — most known exchange hacks have thus occurred through this medium. On the other hand, cold wallets store private keys on offline sources like external hard drives and portable storage devices, making real-time trading difficult but providing better security and stability.“We have taken various preventive measures since the hacking incident in 2019, such as operating hot wallets in a distributed manner. There have not been any successful cyber breaches to date,” Upbit said.Regarding the role of the Ministry of Science and ICT in managing and overseeing crypto hacking incidents, Park pointed out that this still remains ambiguous. “The Ministry should conduct large-scale white-hat hacking tests and security assessments for crypto exchanges that are frequently faced with hacking attempts, as well as for hospitals and subway systems that manage large amounts of personal information,” he said.