China Sees Further Metaverse Development Through Nanjing City Initiative

A recent survey in South Korea found that 20.3% of crypto investors have fallen victim to financial losses. Conducted by the Korea Financial Consumers Protection Foundation in late December, the survey polled 2,500 adults aged 19-69, with respondents able to select multiple loss categories. Investors in their 60s were most vulnerable, reporting a 25.3% loss rate. Exchange-related problems constituted the majority of incidents (72.8%), followed by online chat room scams (44.7%) and investment fraud (35.5%).Photo by Growtika on UnsplashExchange failures lead lossesAmong exchange-related losses, 40.6% of users couldn't sell assets due to system failures, while 11.5% lost digital assets through exchange hacking. Overall, exchange technical issues accounted for 52.1% of reported losses, with another 20.7% losing assets when exchanges closed completely. Chat group scam victims experienced various forms of fraud: 23.2% paid for worthless or false information, while 21.5% suffered financial losses through market manipulation or proxy trading schemes. Investment scams included fake crypto projects or fraudulent firms (18.0%), deceptive exchanges (10.3%), and other scams (7.2%). Most victims (75.1%) reported losses under 10 million won (approximately $6,945), with 34.6% losing less than 1 million won. Due to these relatively small amounts, 67.7% took no action following their losses. Of the 32.3% who sought help through various channels, 73.9% were unable to fully recover their funds. Problem worsening across Asia and beyondThis problem extends beyond South Korea. In neighboring Japan, police reported 19,038 crypto fraud cases in 2023, with damages totaling 45.26 billion yen (about $300 million), according to Chainalysis, citing Japanese National Police Agency data. These figures surpass 2022 numbers, indicating continued growth in fraudulent activities. A recent case highlighted by the Fukushima Minyu Shimbun involved a Soma City woman in her 50s who lost approximately 116.6 million yen ($780,000) to scammers impersonating police officers. The fraud began with a fake customer service call, followed by deceptive claims about fraudulent accounts and threats of arrest, which led her to create cryptocurrency accounts and transfer funds before eventually reporting the scam. Elderly at highest risk as fraud surgesThe FBI's Internet Crime Complaint Center's 2024 report further confirms this trend, documenting 149,686 crypto fraud complaints in the U.S. with $9.3 billion in reported losses—66% higher than in 2023. Notably, people over 60 were the most affected demographic, consistent with the Korean study's findings.

KuCoin affiliate applies for license in Hong Kong amid identity mix-upIn a recent development on the Hong Kong crypto scene, VAEXC Limited, a cryptocurrency exchange, has submitted an application for a crypto trading license. The move had sparked a misunderstanding as some reports suggested the application was submitted by a Binance-linked company when in fact, it turns out to be a KuCoin-affiliated entity.Photo by Stella P on UnsplashReporting confusionA report published in October by the South China Morning Post (SCMP) asserted that a newly established crypto exchange named HKVAEX appeared to be connected with global crypto platform Binance.In the meantime, it emerged more recently that an application for a trading license had been submitted by the similarly named VAEXC Limited. While many reports confused this entity with what is believed to be a Binance-linked company, subsequent reports have emerged to confirm that the application pertains to an entity associated with the Seychelles-incorporated cryptocurrency exchange, KuCoin.In response to these initial wayward reports, a HKVAEX spokesperson confirmed that the company is in the process of preparing a licensing application in Hong Kong but that it has yet to do so. The spokesperson stated:“We are still in the preparatory stages for the application” . . . “VAEXC is an entirely separate applicant, and our operations are completely independent.”Leveraging KuCoin technologyThe SFC updated the list of virtual asset trading platform applicants on Nov. 27, disclosing that Hong Kong VAEXC Limited submitted its application on Nov. 25. Operating under the name VAEX, the exchange places a strong emphasis on security and regulatory compliance, positioning itself as a next-generation, trusted virtual asset exchange.Backed by a team with extensive industry expertise and leveraging KuCoin Tech, VAEX aims to offer a secure, reliable, stable and user-friendly platform for crypto asset trading and management. In celebration of VAEX’s launch, KuCoin conducted a public testing campaign, featuring a 15,000 USDT prize pool for eligible KuCoin users and participants.Despite the recent scandals in Hong Kong’s crypto scene — including an alleged fraud at the JPEX crypto exchange and more recently still, an alleged Ponzi scheme orchestrated by unlicensed crypto exchange Hounax — the regulatory stance in Hong Kong remains unwaveringly positive where digital assets are concerned.Introduced in June, regulations in Hong Kong mandate cryptocurrency exchanges to apply for a Virtual Asset Service Provider (VASP) license from the SFC by June 2024 or face de-registration. Notably, unregistered exchanges are permitted to operate during the interim transition period.KuCoin’s investment arm, KuCoin Ventures, has also been active in Hong Kong. In March, the firm led a $10 million investment in CNHC, a Hong Kong-based stablecoin issuer. Three months later, amid a changing regulatory environment in 2023, the platform confirmed a tightening of its compliance procedures with the introduction of mandatory know-your-customer (KYC) identity checks.Meanwhile, it’s unclear as to what plans Binance has to expand in Hong Kong if any. The leading global exchange is facing very challenging legal issues in the United States currently. That could have a bearing on its plans in Hong Kong, while it remains unclear as to what level of involvement it has with HKVAEX.

Internet-only Kbank offers virtual accounts for fractional art investorsKbank, a neobank based in South Korea, announced on Tuesday (local time) a new service for its customers interested in art investment. According to a report by local news outlet Newsis, Kbank has introduced virtual accounts for clients investing in securities that allow fractional ownership of artworks. These virtual account numbers will mirror the mobile phone numbers of securities subscribers, making them easy to remember and use. Subscribers will utilize these accounts to deposit funds for placing bids on fractional shares of art pieces.Photo by Precondo CA on UnsplashYayoi Kusama’s pumpkinThis unique bidding event, a first in the nation, is scheduled to run until Dec. 22. It will feature “Pumpkin,” a 2001 artwork by renowned Japanese contemporary artist Yayoi Kusama. Artnguide, a platform operated by Yeolmae Company, is managing the event. Yeolmae Company has secured regulatory approval to issue security tokens backed by the artwork.Total of 12,320 sharesThe event offers a total of 12,320 shares, with each share having a par value of KRW 100,000, which is approximately $77. An individual participant in this event is allowed to place bids for a maximum of 300 shares.In the Korean crypto market, Kbank is well-known for providing banking services to Upbit, the nation’s largest fiat-to-crypto exchange. In Korea, legal regulations mandate that any virtual asset service provider offering trading in Korean won must secure bank accounts from a local bank.Kbank’s recent initiative highlights the internet-only bank’s active engagement in the blockchain industry. Presently, Kbank provides its virtual account services to 16 companies, and it is focused on expanding its partnership base. Looking ahead, the bank plans to diversify its financial offerings, exploring innovative approaches like security token offerings to broaden its services in the evolving financial landscape.