South Korea sanctions North Korean tech workers for cybercrimes and crypto theft

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. 

Taiwan Crypto Trader Strikes it Lucky in Tax Receipt LotteryA trader on Taiwan’s MaiCoin Max crypto exchange has struck it rich in an unexpected way, winning a grand prize of 10 million NTD (approximately $310,000) in the country’s monthly national tax receipt lottery.Photo by Nick Fewings on UnsplashFrom 6 cents to $300KWhat makes this story, which was reported by CoinDesk on Friday, even more surprising is that the trader had paid a mere 2 NTD (equivalent to $0.06) in fees on the exchange as they engaged in relatively small trades.The lucky individual, who chose to remain anonymous, didn’t earn this windfall through traditional trading profits or by accumulating tokens. Instead, their fortune came from Taiwan’s unique approach to tax compliance.For crypto exchanges like MaiCoin, every trade conducted on their platform technically counts as a taxable event. This means that active traders can amass numerous virtual “lottery tickets” each month through their trading activities and transaction fees.Uniform invoice lotteryTaiwan introduced its tax receipt lottery system, known as the uniform invoice lottery, back in the 1950s as an innovative method to encourage tax compliance among consumers. While tax authorities worldwide struggle to capture revenue from cryptocurrency holders, Taiwan’s approach allows them to indirectly benefit from the earnings generated on crypto exchanges.For every transaction made by an individual, whether that should occur on a crypto exchange or elsewhere, the individual is issued with a tax receipt. An electronic copy is also registered with Taiwan’s tax authority. Essentially, every receipt then becomes a lottery ticket as the tax authority then runs a draw on an ongoing basis where taxpayers can earn cash prizes.This particular win involving a Taiwanese crypto trader has drawn attention from the broader public. Paul Huang, a Research Fellow at the Taiwanese Public Opinion Foundation, took to X (formerly Twitter) on the subject, stating:”Who says retail users can’t profit from trading cryptos? Taiwan’s largest crypto exchange @MAX_exch announced some user made a tiny trade that paid $2 NTD ($0.06 USD) in fee on platform, the tax receipt ended up winning 10mil ($310k USD) in Taiwan govt’s invoice lottery!”The recent $310,000 jackpot represents the largest prize ever won by a crypto trader through this lottery. Nevertheless, Taiwan’s tax receipt lottery typically produces smaller windfalls, with the country collecting over $7 billion in sales tax revenue in 2021, and a significant proportion paid out in lottery winnings.Critics argue that this system may not be the most efficient way to boost tax compliance, but Taiwan maintains one of the world’s most effective tax regimes, consistently generating impressive revenue relative to its GDP. Additionally, stories of remarkable lottery jackpots serve as excellent public relations for the scheme.There’s little doubt that cryptocurrencies have brought about significant challenges for tax authorities worldwide. In this particular instance, Taiwan’s tax receipt lottery stands as a unique and intriguing approach to fostering compliance while occasionally making crypto traders unexpectedly wealthy.

Crypto Exchange Loss Deters Temasek from Investing in Crypto FirmsSingapore’s state-owned investor Temasek has ruled out investing in crypto companies for now, following a $275 million loss in the bankrupt US crypto exchange FTX.Photo by Plato Terentev on PexelsRegulatory uncertainty concernsTemasek’s Chief Investment Officer Rohit Sipahimalani said in a CNBC interview on Tuesday that the regulatory uncertainty in the crypto sector made it very difficult for the fund to make another investment in an exchange.“There’s a lot of regulatory uncertainty in this environment. And I do think that it will be very difficult for us to make another investment and exchange in the middle of all this regulatory uncertainty,” Sipahimalani said.He added that Temasek was not interested in investing in cryptocurrencies, but rather in exchanges that could generate fee-based revenue without taking balance sheet or trading risks. In May, it was reported that Temasek had invested in algorithmic currency system, Array. However, the global investment company was quick to deny those reports.“We’ve never been looking to invest in cryptocurrencies. Even the investment in FTX, we’ll be talking about investing in an exchange, which allowed us to get fee-based revenue without thinking [of] balance sheet risk or any trading risks,” he said. However, he said that Temasek would not be comfortable investing in exchanges given the way things are right now, and that it would depend on the right regulatory framework and investment opportunity.“If you have the right regulatory framework, and we are comfortable with it, and you have the right investment opportunity, there’s no reason for us to not to look at it,” he said. Temasek’s FTX investment was part of its early-stage investment strategy, where it invests in new disruptive technologies and tries to find the next winners, Sipahimalani said.But the strategy backfired when FTX filed for bankruptcy in November, with more than 1.4 million creditors and billions of dollars in liabilities, according to bankruptcy filings.Reputational damageTemasek wrote down its $275 million investment in FTX to zero soon after the collapse of the exchange. However, the bigger concern for the company is the posting of its worst returns since 2016 amid macroeconomic and geopolitical challenges. In the financial year ending in March 2023, the investing behemoth posted a $7.3 billion loss.The FTX loss sparked criticism from Singapore’s Deputy Prime Minister and Finance Minister Lawrence Wong, who called it “disappointing” and damaging for Singapore’s reputation. And that is the greater issue for Temasek relative to FTX.The amount of that particular loss is not that significant, given the size of the company and the scale of losses incurred elsewhere. The issue has been the reputational damage that the company has experienced as a direct consequence. Temasek maintains that it carried out competent due diligence, as have all of the venture capital investors who have all had their FTX investments wiped out.Further details on that due diligence are likely to emerge as Temasek, alongside many other leading investors in FTX, is being sued by creditors on the basis that they gave credence to what transpired to be a fraud. Temasek announced in May that it would cut the salaries of the staff responsible for the FTX investment, after conducting an internal review of the deal.