Singapore launches BLOOM initiative to advance digital finance infrastructure

Accused of one of the world's largest cryptocurrency scams, Andreas Szakacs, a Swedish national who became a Turkish citizen under the name Emre Avcı, was detained in Istanbul. The alleged international fraud scheme, led by Szakacs, began in 2019 under the guise of OmegaPro, a company dealing in forex and cryptocurrency trading. OmegaPro claimed to generate significant profits for its investors through complex financial algorithms and high-risk leveraged trading. The company, registered in opaque jurisdictions like Saint Vincent and the Grenadines and headquartered in Dubai, promised returns as high as 300% within 16 months, attracting investors from across the globe. High-profile endorsements and lavish eventsTo bolster credibility, Szakacs and his partners, including well-known figures in the finance and crypto sectors like Dilawar Singh and Mike Sims, organized extravagant events. These included the OmegaPro Legends Cup, a football tournament featuring former stars like Ronaldinho, Kaka and Iker Casillas, who were branded as OmegaPro ambassadors. The company also sponsored car races and held opulent conferences in luxury hotels, where gifts and prizes were distributed to participants, further enticing new investors. OmegaPro's operations spanned multiple continents, with representatives in countries such as Colombia, Mexico, the UK and Nigeria. Over time, the company claimed to have attracted 1.5 million investors. However, in late 2022, as withdrawals were suddenly halted, suspicions grew. By July 2023, the company had shut down, leaving an estimated three million investors defrauded and $4 billion unaccounted for.Photo by Xiaoyi Huang on UnsplashAs OmegaPro collapsed, investors from around the world began filing complaints. In France alone, over 1,500 victims have initiated a class-action lawsuit. Similar legal actions have been reported in countries including Mexico, Congo and Myanmar. Despite multiple investigations, the whereabouts of Szakacs and his partners remained unknown—until recently. A tip-off leads to arrest in IstanbulThe breakthrough came on June 28, when an anonymous informant tipped off Turkish authorities about Szakacs' presence in a luxury villa in Istanbul's Acarkent neighborhood. Following an investigation, the Istanbul Gendarmerie identified 18 complainants connected to OmegaPro. On July 9, Szakacs was arrested in a raid on the villa, where authorities found 32 cold wallets containing cryptocurrencies, along with extensive documentation related to OmegaPro’s operations. During questioning, Szakacs denied all allegations, claiming that OmegaPro was a legitimate business that went bankrupt in late 2022, resulting in significant losses for him and his partners. He also refused to provide access to the cold wallets and the encrypted data on his devices. Despite his defense, Szakacs was charged with fraud using information systems and detained by the Beykoz Criminal Court of Peace on July 10. Ongoing legal battles and future implicationsAs the investigation continues, authorities are scrutinizing Szakacs' digital transactions, which reportedly involve $160 million in movements over a single month. His legal team argues that investors knowingly took on risks in the forex market, but the sheer scale of the losses—especially the $103 million claimed by a Dutch complainant representing 3,000 victims—has intensified the case. The outcome of this case could set a precedent for how international crypto-related fraud is handled, particularly in an era where digital currencies and high-risk investments are increasingly intertwined. 

Asian fund acquires majority stake in The BlockIn the wake of certain difficulties experienced following the FTX collapse, prominent crypto publication The Block has secured its future through a strategic sale to Singapore-based venture capital group Foresight Ventures.Taking to the X platform on Monday, The Block’s CEO Larry Cermak announced the acquisition, with Foresight Ventures taking a majority stake in the publication. The deal results in a valuation of the US media group at $70 million. Cermak stated:”This [transaction] gives The Block a fresh start ahead of the bull market and provides us with more capital to build out new exciting products and expand our footprint into Asia and the Middle East.”Cermak also thanked New York-based investment bank Moelis & Company for its help in running the process.Photo by Kelly Sikkema on UnsplashFTX controversyThe sale should allow the firm to move on from a difficult situation which saw it implicated in the activities of convicted fraudster and former FTX CEO Sam Bankman-Fried (SBF). The fallout from the collapse of the FTX exchange in November of last year included the revelation that The Block had relied on undisclosed loans from SBF to sustain its operations.Michael McCaffrey, the former CEO of The Block, resigned last December after it was disclosed that he had borrowed $43 million from SBF’s Alameda Research, a crypto trading company. This financial arrangement was allegedly aimed at supporting the media company and facilitating property acquisitions.Following the conviction of SBF on charges of fraud and money laundering in New York earlier this month, The Block faced challenges and turned its focus towards building a more robust institutional customer base. The media group has been actively engaged in compiling industry deals and offering subscription-based news services.McCaffrey had taken loans totaling $27 million to buy out shareholders and support the media group, with an additional $16 million used for property acquisition in the Bahamas. The financial arrangement with Alameda was undisclosed to the broader team at The Block, as revealed by Bobby Moran, the company’s chief revenue officer at the time.It’s still unclear if McCaffrey has repaid these loans to the FTX Debtor that is currently managing the FTX business. FTX filed for Chapter 11 bankruptcy in November 2022 and with that, it is in the process of being restructured.$56 million investmentAs part of the deal, Foresight Ventures will invest $56 million, securing an 80 percent stake in The Block, according to a source cited by the Financial Times (FT). The investment is a strategic move, especially considering the recent slowdown in venture capital investment in the crypto market.While investors injected approximately $30 billion into crypto projects in both 2021 and 2022, the figure plummeted to $7 billion by the end of September of this year, according to PitchBook.Foresight Ventures CEO Forest Bai confirmed to the FT that The Block will continue to operate as an independent business. Bai stated: “We think The Block is one of the crown assets in the crypto media space. Our view is that the media aspect will continue to drive education and adoption in the space.”

UBS Pioneers Tokenized Money Market Fund on EthereumUnderscoring what is very much an ever-evolving financial sector, large-scale investment manager UBS Asset Management has taken a pioneering step by launching a pilot project for a tokenized money market fund on the Ethereum blockchain.Photo by Bastian Riccardi on UnsplashBlurring the lines of TradFiThe initiative, announced by UBS in Singapore on Monday, promises to streamline the traditionally cumbersome processes of fund subscriptions and redemptions. Additionally it highlights the increasing integration of blockchain technology into traditional finance, effectively blurring the boundaries between the two worlds.The UBS project aligns with Singapore’s Variable Capital Company (VCC) fund structure and falls within the scope of Project Guardian, championed by the Monetary Authority of Singapore (MAS).Structured in this way, UBS believes that the project design lends itself to the ability to bring various forms of real-world assets (RWAs) to the blockchain. Furthermore, it establishes a favorable rapport with regulatory authorities in Singapore, a jurisdiction known for its forward-thinking, crypto-friendly financial regulatory environment.Public blockchain useThis new offering relies upon a smart contract that’s run on the Ethereum public blockchain, encapsulating the money market fund. Through this smart contract use, the subscription and redemption processes can be simplified. That will represent a major change, given that those processes have traditionally been laden with paperwork and delays.In the first iteration, large TradFi firms like UBS considered the use of private blockchains but as Matt Hougan, the CIO of crypto asset manager Bitwise, pointed out, this particular initiative is indicative of a shift towards public blockchains. Hougan stated:“Remember when TradFi projects were built on private blockchains? They are all being built on Ethereum today. Progress.”RWA tokenization potentialThe tokenization of real-world assets has the potential to revolutionize digital asset investments by offering transparency, security, and trust. It not only paves the way for a better understanding of digital assets but also accelerates their adoption. UBS’s pilot project represents another significant move in this direction.With increasing support from regulatory bodies like MAS, the fusion of digital assets with traditional financial structures is likely to witness a myriad of large-scale implementations in the not too distant future.UBS TokenizeUBS harnessed the power of its in-house tokenization service, UBS Tokenize, to seamlessly conduct the controlled pilot of the tokenized money market fund. The initiative falls squarely within the purview of UBS’s global distributed ledger technology strategy, which aims to elevate fund distribution and issuance to greater levels of efficiency by leveraging the capabilities of both private and public blockchains.UBS Tokenize also featured in a separate initiative earlier this year in Hong Kong, facilitating the issuance of digital structured notes on the Ethereum blockchain via the Bank of China Investment (BOCI).The momentum behind the tokenization of real-world assets has been building in recent years, with various protocols focusing on real-world assets consistently outperforming other sub-sectors of decentralized finance.