Terraform Labs co-founder Do Kwon sentenced to 15 years for ‘generational’ fraud

Chinese Prosecutors Issue Warning on NFTsIn recent days, China’s top procuratorial agency, the Supreme People’s Procuratorate of China, issued a warning alongside some guidelines on non-fungible tokens (NFTs).The Supreme People’s Procuratorate is the highest office in China charged with the mandate of upholding legal integrity, safeguarding citizens’ rights, and where necessary, conducting criminal investigations. In a statement published on Monday, the agency set out an advisory, together with additional recommendations, pertaining to NFTs.Photo by Markus Winkler on PexelsNFT status in ChinaWhile all and sundry are aware of a multi-year crack-down by the Chinese authorities on crypto in recent times, exemplified by a ban on crypto trading and the operation of crypto mining facilities within the country’s borders, the status of NFTs has been discussed to a much lesser degree.NFTs remain legal within the country. When the crypto trading ban came into play in 2021, much of the local industry connected with that trading activity disappeared. However, in its place, a newly emergent trend came to the fore in the form of NFTs. With cryptocurrencies perceived as being high risk and sanctioned by the authorities, attention turned to NFTs and there has been a surge of adoption of the digital collectibles within China as a consequence.NFT risksThe procuratorial agency highlighted a number of attributes as well as risks in relation to NFTs in the report that it published. The agency finds the issue of ownership of NFTs as a troublesome one. It cites the fact that NFTs can be replicated and distributed at will on this basis as being particularly problematic. The legitimacy of the right source of the work itself is the decisive factor for the healthy and orderly development of digital works NFT transactions,” it states.It appears that the agency, like many in traditional professional circles before them, have a difficulty recognizing the model of asset ownership that NFTs incorporate. That ownership is not defined by civil law or in accordance with centralized systems but by simply the possession of the requisite private key pertaining to a given NFT within a decentralized system.Blockchain, not cryptoThe agency acknowledged that NFTs do present a novel application of blockchain technology. This is not surprising as while there might be an ongoing clampdown on decentralized cryptocurrencies in China, officials at a national level and in numerous instances within regional administrations, are demonstrating a strategy of leveraging blockchain technology for the betterment of the Chinese economy in the future.Public prosecutor Wang Xia-fen, one of the authors of the report, stated: “It’s widely recognized that digital collectibles have the potential to protect intellectual property rights, boost content creation and enrich the digital economy.” Wang encouraged public prosecutors to “find the distinction between real innovation and criminal activities” where NFTs are concerned.The upshot of its report though, is that the procuratorial agency is uncomfortable with the similarity of many of the attributes of NFTs when compared with decentralized cryptocurrencies. It issued a warning on that basis, emphasizing a need for risk assessment to be carried out and further consideration of the legal risks that are implicated.

Hyperithm, a digital asset management firm based in Tokyo and Seoul, has invested in JPYC Inc., the issuer of JPY Coin (JPYC), the first stablecoin pegged 1:1 to the Japanese yen. First launched in January 2021, JPYC is a legal Prepaid Payment Instrument in Japan that is issued on various blockchains, including Ethereum and Polygon. The total figure for the investment was not disclosed by either party.Photo by Precondo CA on UnsplashInsights from industry leaders"We believe that stablecoins linked to fiat currencies are essential to expanding the cryptocurrency ecosystem. Japan became one of the first countries to officially issue stablecoins after the revision of the Payment Services Act in June," said Lloyd Lee, CEO of Hyperithm. "We expect that the widespread adoption of JPYC will increase the inflow of Japanese capital into the cryptocurrency ecosystem." Noritaka Okabe, CEO of JPYC Inc., explained that the firm aims to create more connections between crypto and everyday life, forging an environment where everyone can participate in innovation and capital liquidity. JPYC Inc.'s strategic evolutionAlthough it is currently issued as a third-party Prepaid Payment Instrument, JPYC Inc. plans to acquire a license to conduct transactions including money transfers and electronic payments in accordance with the revision of the Payment Services Act, which took effect in June 2023. This will serve to strengthen the stablecoin’s trust structure and remove limits on remittances. After acquiring the license, Mitsubishi UFJ Financial Group, a bank holding and financial services company based in Tokyo, will be responsible for JPYC's fiat currency reserves. Pioneering crypto financeFounded in January 2018, Hyperithm provides crypto corporate finance services to institutional and upper-class investors. It is one of South Korea’s 29 companies that are licensed by the Financial Intelligence Unit (FIU) to operate as a Virtual Asset Service Provider (VASP). Notably, it raised $11 million in a series B funding round in 2021, which was led by former clients Hashed and Wemade Tree. The company’s CEO, Lee, was also listed on Forbes’ 30 Under 30 Asia under the Finance and Venture Capital category. 

ClearVue Partners-Backed Crypto Startup Fund Closed at $50MThe CVP NoLimit Fund I, a crypto-centric fund established by China’s ClearVue Partners, a private equity specialist, has been closed out, reaching a funding level of $50 million.Photo by micheile henderson on UnsplashFunding target achievedThe closing of the fund was announced recently by No Limit Holdings, an investment partnership specializing in global crypto assets based in Malta. ClearVue had entered into a joint venture with No Limit Holdings in order to establish the fund. No Limit Holdings was founded by former Binance Chief Strategy Officer Gin Chao. Partnering with Chao in that venture is another former Binance executive, Anatoly Kondiyakov, who served as Binance’s Head of APAC Institutional Sales in Singapore for four years.News of the fund first emerged in October 2022, when the fund promoters started to distribute a pitch deck. It’s understood that the fund was targeting investment into layer one blockchains prior to their native tokens going live.Chao made the following statement relative to the closing of the fund:“We are grateful for the confidence and trust that our partners have placed in us for this first fund, particularly given the breadth of industries our LP base represents and the challenging macroeconomic conditions during this period. At the same time, this has created an ideal window to deploy capital into the exciting opportunities that the current market presents.”Web3 “where the Internet was in the late 90s”ClearVue Partners Founder, Harry Hui, said that the firm was “excited to team up with Gin and the NLH team. They have deep sector expertise and an incredible track record of success.” Hui added that “Web3.0 is where the Internet was in the late 90s and as blockchain adoption increases, we believe there will be significant value creation for both for our investors as well as for our consumer and technology portfolio companies.”The CVP NoLimit Fund I has already invested in more than twenty crypto projects located globally. Two of them have been listed on multiple digital asset exchanges. Meanwhile, the fund’s administrators have suggested that it has established a robust pipeline of investible projects, and that it has the expectation to invest in an additional twenty projects over the course of the next twelve months.Seed-stage focusThe fund has been focusing on early-stage projects and strategic funding rounds, with individual investments of between $250,000 and $3 million. Some of the projects it has backed thus far include Binance.US, crypto and blockchain infrastructure firm Mysten Labs, Singapore-based dApp developer Hogwarts Labs, Connext Labs which claims to be the HTTP of Web3, and decentralized digital asset money market, IQ Labs.Venture capital investment into the crypto and Web3 space broke all records during the last crypto bull market. Naturally, it has suffered a huge decline in its wake. However, the closing out of this $50 million fund demonstrates that ultimately new money will return to the sector.This is further exemplified by a recent announcement by Kraken Ventures, the venture investment wing of the well-known crypto exchange business, setting out that it is raising a second $100 million fund, earmarked for investment within the sector.