Crypto fraud hits 20% of Korean investors, global trend shows seniors most vulnerable

Hong Kong’s SFC Issues Warning Against Unlicensed Crypto PlatformsIn a move to safeguard its financial ecosystem, the Hong Kong Securities and Futures Commission (SFC) issued a stern warning recently, cautioning against the activities of unlicensed cryptocurrency exchanges involved in what it termed “improper practices.”In a statement published to its website on Monday, the regulatory authority underscored the gravity of engaging in unlicensed operations within the crypto trading sphere, categorizing such activities as a “criminal offense” under Hong Kong jurisdiction.Photo by Chi Hung Wong on UnsplashDeceptive tacticsFurthermore, the SFC exposed the deceptive tactics employed by certain unlicensed crypto trading platforms, which misleadingly assert that they have submitted license applications to the commission. The reality, however, is quite the opposite, as these platforms remain unregulated.The warning coincides with the SFC's ongoing establishment of a novel regulatory framework for overseeing retail crypto trading. Notably, the SFC made it clear that applicants who fail to adhere to pertinent regulations might find themselves ineligible for licensing under the newly instituted regime.This initiative from the SFC aligns with the broader efforts undertaken by Hong Kong authorities to instill effective oversight and regulation within the cryptocurrency market. The primary objective remains the protection of investors’ interests and the preservation of the integrity of the overall financial system.Platforms must demonstrate ability to complyThe SFC emphasized, “VATPs (Virtual Asset Trading Platforms) which consider themselves eligible for deeming under the transitional arrangements are reminded that the SFC may decide that deeming is inapplicable if it does not see a reasonable prospect for the VATPs to successfully show that they are capable of complying with the applicable legal and regulatory requirements.”This development follows closely on the heels of Hong Kong’s recent announcement outlining plans to grant licensed cryptocurrency platforms the permission to cater to retail investors within the new regulatory framework.These comprehensive guidelines encompass critical facets such as cybersecurity protocols, asset custody safety standards, and the segregation of client assets. This regulatory evolution commenced on June 1, synchronizing with the launch of the novel licensing regime for virtual asset platforms.Drawing attention to the growing influence of the sector, it’s worth noting that in April, cryptocurrency exchange OKX registered an astonishing surge of over 10,000 new user sign-ups within a mere month of launching its operations in Hong Kong.Web3 implementationIn a recent tweet, Chris Lee, former CEO of both the Huobi and OKX crypto exchanges, said that “if Hong Kong wants to implement Web3 well, it still needs to complete the basic requirements, such as Web3 foundation laws and bills.” Lee added that “Hong Kong’s competitors will always be itself, not New York or Singapore.”The Hong Kong SFC’s warning to unlicensed crypto platforms is another step in creating the right foundation for Web3 in the city. It underscores the concerted effort to maintain a regulated and secure environment for cryptocurrency transactions within the Chinese autonomous territory.As the regulatory landscape continues to evolve, industry participants are gradually being compelled to adhere to the stipulated legal and compliance requirements in an effort to foster a robust crypto ecosystem.

South Korean gaming publisher Wemade attended this year’s Taipei Game Show – the largest gaming exhibition in Taiwan – from Thursday to Sunday, where it showcased its upcoming games Night Crows and Fantastic 4 Baseball, according to news site Bridge News.Photo by Mateo on UnsplashUnveiling upcoming blockbustersAt the event, Wemade operated an exclusive booth with game demos and promotional videos. There was also a cosplay of characters from the Night Crows game and a special performance by the TSG Hawks' cheerleading team, the Wing Stars. The TSG Hawks is a professional baseball team that joined the Chinese Professional Baseball League (CPBL) last year. The Wing Stars are led by the famous Korean cheerleader Ahn Ji-hyun. In addition, Lee Jung-wook and Lee Kun-hee, the CEOs of Night Crows developer Madngine, and Fantastic 4 Baseball developer Round One Studio, took to the stage to interact directly with gamers. "Night Crows is the first MMORPG developed with Unreal Engine 5, and you can enjoy top-notch visuals with Mad Engine's unique know-how," said Lee Jung-wook. "We promise to provide new fun and stable services to our global users." "While developing Fantastic 4 Baseball, we put a lot of thought into capturing the essence of baseball and making the players' faces and batting forms look realistic," Lee Kun-hee added. "We plan to bring the game to the global market when the Taiwanese baseball league begins." Market-dominating releasesNight Crows has been popular among gamers in South Korea, where it launched in April last year, topping the popularity and revenue rankings on major app markets. The global version of the game utilizes blockchain technology to implement an advanced tokenomics ecosystem. Global pre-registration will open on Jan. 11. On the other hand, Round 1 Studio’s Fantastic 4 Baseball is a realistic baseball game where players can create their own team with famous players from various leagues, including the CPBL. The demo version includes single-player and home run derbies. Both games are slated for global release in March.

SEC Opposes Motion to Dismiss Terraform Labs LawsuitLawyers representing the United States Securities and Exchange Commission (SEC) have responded to a motion to dismiss the lawsuit filed by Dentons, the lawyers representing Singapore-based Terraform Labs and its Founder Do Kwon.Photo by Miguel Á. Padriñán on PexelsCourt filingAccording to its arguments, set out in a court filing lodged to the District Court of the Southern District of New York on Thursday, the SEC’s counsel claims that the additional documents provided by Dentons lack sufficient grounds for dismissing the case.It claims that the internal SEC emails presented by Dentons are irrelevant to the current lawsuit. The SEC asserts that the parameters of an “investment contract” are clearly defined by the Howey test and argue that TerraUSD ($UST) should be classified as a security.The reliance by US regulators on the Howey test, a legal test case that implicated citrus grove contracts that date back to 1946, has proven to be controversial. Naturally, there could have been no consideration of the digital innovation that digital assets present today almost eighty years ago. Notwithstanding that, the SEC maintains that the principle factors of what constitutes an investment contract are covered by the case regardless.During the court hearing held on June 15, Dentons submitted supplementary documents to strengthen their motion to dismiss the lawsuit. The primary focus of the hearing was to determine whether the digital assets developed by Terraform Labs should be categorized as securities based on the criteria of an “investment contract.”Dentons maintains that the algorithmic stablecoin, $UST, should not be considered a security and emphasizes its practical purpose rather than its classification as an investment contract. To support their motion, Dentons included additional documents such as the US House Financial Services Committee hearing on digital asset regulation and stablecoin issuance, the SEC’s request for a restraining order against Binance.US, and the Hinman emails from the SEC vs. Ripple lawsuit.Judge to decideThe defense lawyers highlighted what they perceive as a “regulatory gap” in classifying crypto assets as securities, particularly as the US Congress engages in discussions about regulatory frameworks for digital assets and stablecoin issuance. Furthermore, they argued that the SEC is exceeding the scope of securities laws and relying on internal emails related to “investment contracts” to determine the security status.A decision on the motion to dismiss will be arrived at by July 14. Judge Jed Rakoff, who is presiding over the case, will be responsible for that, once he’s weighed up the merits of the arguments presented by both parties.It is noteworthy that Dentons has previously represented Kwon in challenging the US SEC’s subpoena during the investigation of the Mirror Protocol in 2021, as well as in a class-action lawsuit in the Singapore High Court in 2022. The law firm also provides representation to Terraform Labs in other legal matters.In a separate development, the Basic Court in Podgorica, Montenegro, has granted bail for Kwon and former Terra Chief Technology Officer Han Chang-joon. However, Kwon has recently been taken into custody for extradition in Montenegro while the court deliberates on South Korea’s extradition request for the Terra founder.As the legal proceedings continue, the outcome of the motion to dismiss will have significant implications for the ongoing dispute between Terraform Labs, Do Kwon, and the SEC.