Hong Kong firms move forward with staking services

OKX collaborates with Polygon Labs on layer-2 network launchSeychelles-incorporated OKX, one of the world’s largest cryptocurrency exchanges, has collaborated with blockchain development firm Polygon Labs to unveil the testnet for its latest zero-knowledge layer-2 network, named “X1.”Photo by Shubham Dhage on UnsplashIntroducing “X1”The company announced initial details on X1 via a press release published on Tuesday. This Ethereum-based ZK network has been constructed using the Polygon Chain Development Kit (CDK), with OKX playing a pivotal role as a core contributor to the CDK. Substantial engineering resources are being invested by OKX to strengthen the Ethereum scaling solution.The new network will serve to bolster the utility of OKX's native token, OKB. OKB will be used for X1’s gas fees. There has been a lot of chatter about the utility of exchange tokens following the collapse of FTX, as that platform was over-reliant on its native token in propping up the exchange. Similarly, critics are speculating that a comparable dynamic may be at play at Binance, relative to its native token BNB.Likely buoyed by news of this development, OKB observed a 10% unit price increase on Tuesday. However, that move has retraced downwards in the meantime.ZK proof technologyX1 has been designed with ZK proofs, a method through which one party can convince another that a particular claim is true without disclosing details of the claim itself. In this way, X1 ensures high security and scalability while mitigating transaction costs. The network seamlessly aligns with Ethereum, facilitating the secure deployment of EVM-based dApps and connectivity with a wide array of smart contracts, wallets and tools. OKX underscores X1’s status as its new native network.Chief Innovation Officer of OKX, Jason Lau, expressed optimism about X1, deeming it integral to the firm’s efforts in guiding users into the realm of Web3. Lau emphasized the scalability and accessibility of X1, especially for developers who can leverage it to construct user-friendly Web3 applications while maintaining interoperability with other networks.The collaboration with Polygon Labs marks another milestone in the evolution of Polygon’s CDK. Launched in August, the CDK enables the development of layer-2 blockchains on Ethereum, emphasizing zero-knowledge proofs. Networks deployed using the CDK gain the ability to connect to a shared ZK bridge, fostering interoperability.Sandeep Nailwal, co-founder of Polygon, underscored the significance of X1’s adoption of Polygon CDK technology, envisioning a future where CDK-deployed chains interoperate and coexist within a larger network of ZK-powered layer 2s in the Polygon CDK ecosystem. The CDK has gained traction, with various Layer 2s, including Immutable zkEVM, IDEX, Palm Network and Astar zkEVM, currently in development using this technology.Industry trendA trend is developing among crypto exchange platforms and their involvement in establishing layer two networks. Earlier this year, U.S. crypto platform Coinbase introduced the Base network, an Ethereum layer-2 network that focuses on offering a safe, low-cost and developer-friendly mechanism to build on-chain.Last week, it emerged that another leading U.S.-based crypto platform, Kraken, is on the lookout for a development partner to enable it in building out its own layer-2 blockchain network. According to those reports, it’s understood that Kraken is considering partnering with Polygon Labs, Matter Labs or the Nil Foundation.As this OKX-Polygon Labs collaboration progresses, the industry will continue to observe how X1, with its innovative technology stack and seamless integration with Ethereum, contributes towards broader Web3 development.

In an effort to safeguard crypto investors from falling prey to misleading advertisements, the Securities and Exchange Commission (SEC) of Thailand has intensified its scrutiny of promotional campaigns within the crypto sphere. Photo by Dave Kim on UnsplashBroker agent eventsOn April 29, the Bangkok Post reported that the SEC has raised concerns regarding the potential violation of local regulations through introducing broker agent (IBA) events. These events, the SEC clarified, may breach regulations as IBAs are only permitted to promote digital token services to deter speculation on cryptocurrencies, categorized as high-risk assets. IBAs, acting as local conduits for partner digital asset exchanges, typically earn commissions by onboarding clients within a specific market. Such practices are common for exchanges or brokers that don't directly operate in certain markets. Deputy Secretary-General Anek Yooyuen conveyed the commission's unease over crypto exchanges offering preferential treatment to onboard users. Yooyuen stated: "When operators organise sales promotions by offering rewards to entice people to use the service, this could encourage use of the service without considering the investment risks. This is especially the case for cryptocurrencies.” Warning of consequencesHe cautioned that failure to adhere to these guidelines would result in “punishment according to the law.” While cryptocurrency exchanges are legal in Thailand, they must secure local approval. Notably, last month, Thailand even greenlit asset management firms to launch private funds, offering Bitcoin exchange-traded funds (ETFs) exclusively to institutional and ultra-high-net-worth investors. Nonetheless, the country recently prohibited the sale of cryptocurrency lending products and mandated that exchanges prominently display risk warning messages. International regulatory trendThis move by the Thai SEC mirrors actions taken by regulators in other major crypto markets. For instance, the United Kingdom's Financial Conduct Authority (FCA) issued 450 alerts for illegal crypto ads in 2023 alone. Similarly, Spain’s principal securities market regulator, the National Stock Market Commission, denounced fraudulent crypto asset promotions in November 2023, emphasizing companies’ obligations to adhere to local laws. Thai advertising guidelines mandate businesses and advertisers to substantiate the “facts” presented in their campaigns, failing which could lead to legal repercussions. A recent incident provides a case in point. Hackers hijacked advertisements on Etherscan, redirecting users to phishing sites aimed at draining crypto wallets. Scam Sniffer, a blockchain investigation firm, attributed the widespread phishing campaign to the inadequate oversight by advertisement aggregators. The company made the following statement on the matter: “Etherscan aggregates ads from platforms like Coinzilla and Persona, where insufficient filtering could lead to exposure to phishing attempts.” The wallet drainer scam involves enticing users to counterfeit websites and coercing them to link their crypto wallets, enabling scammers to siphon funds into their own wallets without user authentication or consent. This is not the first time that the authorities in Thailand have homed in on crypto-related advertising. In August 2023, the Southeast Asian country’s Ministry of Digital Economy and Society (MDES) outlined that it had engaged with social media firm Meta, owner of Facebook, informing it that its response to the proliferation of fraudulent platform ads relative to crypto had been inadequate. 

Xangle and CertiK Team Up to Promote Mass Adoption of Web3CrossAngle, the operator of the virtual asset data analysis platform Xangle, announced on Wednesday that it has teamed up with CertiK, a global blockchain security ranking platform, to promote the mass adoption of Web3 technologies and contribute to the formation of a secure and transparent blockchain ecosystem.Photo by Shubham’s Web3 on UnsplashStrengthening security and data insightsCertiK is a security-focused ranking platform for analyzing and monitoring blockchain protocols and DeFi projects. Through this new partnership, Xangle will gain access to Skynet, CertiK’s Web3 security analysis platform that monitors and visualizes on-chain and off-chain data with cutting-edge technology, along with other API data. In turn, CertiK will receive access to Xangle’s cryptocurrency reference price API and on-chain data analyses.CertiK’s industry analysis reports will also be regularly featured on Xangle’s research platform. Xangle’s research reports are well-regarded throughout the industry and have been featured on local and international financial information platforms such as Bloomberg Terminal, CoinMarketCap, Yonhap Infomax, and FnGuide.Positive outlooks“We are delighted to partner with CertiK, a global leader in Web3 security. We are already anticipating great synergy with our strong capabilities in on-chain data analysis,” said Jake Lim, Chief Business Development Officer (CBDO) of Xangle. “We believe that this collaboration between our two companies will accelerate the mass adoption of Web3 technologies.”Jason Jiang, Chief Business Officer (CBO) of CertiK, added that the partnership is expected to not only enhance security and transparency in the blockchain ecosystem but also help set new industry standards.This partnership between CertiK and Xangle reflects the growing importance of security and data analysis in the rapidly evolving Web3 landscape, as both companies work together to drive its widespread adoption.