Worldcoin resumes services in South Korea after two months of suspended operation 

Vietnamese authorities have dismantled a criminal ring that used cryptocurrency to launder illicit gambling profits, AFP reported, citing local media. The group converted local currency into digital assets such as USDT and Ethereum, routing funds to users for online betting. Operating multi-layered investment websites, the network grew to as many as 20,000 users and managed 25 million accounts, despite Vietnam’s ban on cryptocurrency. In total, the transactions involved were valued at roughly $3.8 billion. Police allege that millions of dollars were funneled into real estate, luxury cars, and cross-border cash transfers. While the money laundering probe continues, the gambling case has already produced convictions. Four Vietnamese siblings who ran the network, along with 39 other defendants, received sentences in Ho Chi Minh City ranging from a three-year suspended term to 13 years in prison. An Indian national identified as the alleged mastermind remains at large.Photo by Amanda Jones on UnsplashThai police foil crypto-themed fraudElsewhere in the region, police in neighboring Thailand busted a South Korean crime syndicate based in Pattaya that allegedly stole more than 20 billion won ($14.2 million) through fraud schemes that invoked cryptocurrency as a lure, along with other scams, the Chosun Ilbo reported. The scam ring reportedly obtained customer data from a lottery tip site and collected money from victims either by posing as agents offering membership refunds or by claiming to provide compensation for leaked personal information, which they disguised as opportunities to buy digital assets. In addition to these schemes, the syndicate ran romance scams and posed as authorities. Thai police arrested 20 members in a June resort raid. Nine more suspects, including ringleaders, remain in custody awaiting extradition. Seoul police said that, in total, 25 members have been caught, 21 of whom are now detained. Authorities believe the network may be linked to other groups in Thailand and are widening the investigation. Europe uncovers $120M crypto fraudCrypto crimes aren’t limited to Asia. In Europe, police arrested five suspects in a Eurojust-led operation that uncovered an online investment scam worth at least €100 million ($116.8 million). Operating since 2018 across 23 countries, the scheme lured victims with platforms promising high returns, then funneled deposits through Lithuanian accounts before disappearing. In a report by the Organized Crime and Corruption Reporting Project, Elliptic Chief Scientist Tom Robinson said such schemes often have little to do with cryptocurrency itself, instead exploiting its technical obscurity and the allure of quick gains. Beyond scams, outright theft from crypto platforms is also climbing. A Chainalysis study found that by the end of June 2025, more than $2.17 billion had been stolen from exchanges and related platforms—already surpassing the total for all of 2024. The firm projects losses could reach $4 billion by year-end. The single largest incident was the February hack of the Bybit exchange, in which thieves took $1.5 billion, roughly 69% of all funds stolen in the first half of this year. Crypto crime turns increasingly violentThe Chainalysis report also flagged a rise in physical attacks, in which criminals use violence or coercion to force individuals to hand over their crypto holdings. The firm warned that 2025 may log nearly twice as many cases as the worst year on record, noting that the attacks often rise and fall with expectations for Bitcoin’s price. In response to these threats, Chainalysis stressed the need for a multilayered approach to crypto security. It advised service providers to strengthen internal controls through regular audits and employee screening, while upgrading wallet infrastructure and other technical defenses. For individuals, the firm said, keeping holdings discreet has become as critical as technical safeguards, especially amid the rise in physical attacks. 

Rising Cryptocurrency Arbitrage Transactions Raise Concerns in South KoreaThe number of arbitrage transactions between South Korean and foreign cryptocurrency exchanges has been experiencing a notable uptick, according to a report by local media outlet Maeil Business Newspaper.In recent developments, foreign actors engaging in price manipulation have been transferring substantial amounts of cryptocurrency assets to Korean exchanges, driving up prices. Subsequently, they transfer these tokens from Korean exchanges back to overseas platforms, capitalizing on the price discrepancies to generate profits.Photo by Maxim Hopman on UnsplashBithumb’s case in H1According to documents submitted to Kim Hee-gon, a member of the ruling political party People Power Party, on Monday, KRW 3.4 trillion ($2.6 billion) worth of tokens were moved from Bithumb, a leading Korean cryptocurrency exchange, to foreign trading platforms during the first half of this year. Although this figure marks a 40% decrease compared to H1 2022’s KRW 5.7 trillion, primarily due to the significant decline in token prices across the cryptocurrency market, it’s noteworthy that the number of transactions has seen a significant increase.Other exchangesGopax, another major exchange in the nation, recorded token outflows totaling KRW 12.3 billion. On the other hand, Upbit, Coinone, and Korbit, which are also prominent exchanges, declined to provide data due to reasons like confidentiality concerns. However, given that Upbit holds an 82.0% share of the Korean crypto market, nearly four times larger than Bithumb’s share (14.2%), it is suspected that the volume of tokens transferred from Upbit to foreign platforms would likely have followed a similar proportion.While the value of tokens sent from Bithumb to overseas operators saw a year-over-year decrease, the number of transactions surged to 231,302, nearly doubling the figure of H1 2022’s 124,048 transactions. The average transaction size was KRW 14.7 million.Even though the overall enthusiasm for cryptocurrencies might have cooled off since last year, the spike in the number of transactions suggests that there’s been a surge in arbitrage trading between Korea and foreign markets.Kimchi premiumEarlier this month, a significant transaction caught the eye of cryptocurrency market observers in South Korea. On September 1, crypto data analytics firm Arkham identified that 170,000 CyberConnect (CYBER) tokens were transferred to Bithumb from a crypto wallet thought to be owned by DWF Labs, a firm specializing in cryptocurrency trading and investment. The timing of the transaction coincides with a period during which the Kimchi premium for CYBER exceeded 100%. The Kimchi premium refers to the crypto price gap between Korean exchanges and their foreign counterparts.The complicating factor here is that DWF Labs is a foreign entity that is managed by a foreign team.The use of corporate accounts is virtually prohibited in the Korean crypto market. The Travel Rule mandates that any transfers of tokens between Korean and international exchanges must go through accounts that have been verified under Know Your Customer (KYC) guidelines. Given these regulations, there are growing suspicions within the crypto community that foreign venture capitalists may have used accounts in borrowed names to conduct sales on Korean exchanges, which are restricted to Korean citizens. However, it’s worth noting that there is currently no legal basis for taking punitive action even if borrowed-name accounts were indeed used.Lawmaker Kim commented on the limitations of current financial regulations aimed at preventing money laundering in the cryptocurrency market. Despite efforts by financial authorities, including the introduction of the Travel Rule, Kim stated that these measures have not been very effective. He emphasized the urgency of enhancing the regulatory framework to curb potential illicit activities involving cryptocurrencies, such as those exploiting market arbitrage opportunities.

Palau proceeds with Ripple to Phase 2 of PSC currency program launchThe Ministry of Finance of Palau has officially initiated the second phase of its Palau Stablecoin (PSC) program, a move aimed at expanding the digital ecosystem and enhancing user engagement.The launch was confirmed by Jay Hunter Anson, a cybersecurity consultant in Palau and adviser to the Ministry of Finance. Taking to the X social media platform on Friday, Anson outlined that “the Republic of Palau Ministry of #Finance seeks to expand accessibility and user participation, reaching a wider audience through educational initiatives.”PSC is a digital currency issued and managed by the Palau Ministry of Finance. It’s pegged to the United States dollar and operates on Ripple’s XRP Ledger. It first emerged that the authorities in Palau were collaborating with Ripple on this project back in July.Photo by Kurt Cotoaga on UnsplashBuilding on phase 1 successIn this next phase, Palau seeks to extend its collaboration with Ripple, leveraging Ripple’s central bank digital currency (CBDC) platform and technical expertise.The Ministry of Finance in Palau had previously announced the success of the first phase of the PSC program earlier this month. This initial three-month phase involved 168 volunteers from government employees who received 100 PSC each to use at local retailers participating in the program. Payments were made through mobile phones by scanning a QR code, and both retailers and volunteers provided positive feedback about their experience with the digital currency.Anson highlighted that the focus of the second phase of the PSC pilot program includes establishing new collaborations for marketing and sustainable development goals. Furthermore, the program prioritizes the development of a digital ecosystem and increased user engagement, with a strong emphasis on regulatory compliance.Anthony Welfare, CBDC Strategic Adviser at Ripple, shared his insights on the launch of the PSC pilot program’s second phase via social media. He underscored the advantages of blockchain-based digital currency, citing reduced transaction fees and the potential to address the environmental impact of money circulation. However, Welfare also acknowledged specific challenges, including the complexity of moving traditional currencies across Palau’s 340 islands and the high mobile data costs in the country.Welfare pointed out a notable feature of PSC, emphasizing that Palau residents can conduct offline transactions using this blockchain-based digital currency, even during power outages.Agile technological adoptionEarlier this month Ripple President Monica Long was featured by the New York Times in an article where she set out expectations for 2024. Long articulated that she believes that “people cannot maintain their faith in a financial system that relies on systems built decades ago to move money.”With the rise of cryptocurrency and blockchain technologies, it’s clear that our financial rails can and will be internet-native, in turn bringing greater accessibility and affordability to financial services for everyone,” Long added.Smaller nations like the Micronesian Republic of Palau have been more nimble in adjusting to the changes that Long refers to. This PSC stablecoin project demonstrates that reality.Palau is not alone. It emerged a few weeks ago that the Solomon Islands had entered into a collaboration with Japanese blockchain technology firm Soramitsu. As part of that project, a CBDC named Bokolo Cash has been unveiled as a proof of concept.