Param Labs Secures $7M investment to bolster Web3 gaming infrastructure

FTX, the failed cryptocurrency exchange founded by Sam Bankman-Fried, has taken legal action by filing a lawsuit against four former employees of Salameda, a Hong Kong-based affiliate closely linked to the exchange’s former CEO.According to a Delaware bankruptcy court filing in the United States on Thursday, the lawsuit alleges that five individuals exploited their personal connections to prioritize their asset withdrawals from FTX during a period of uncertainty regarding the exchange’s stability. The defendants in question are Salameda’s former employees — Michael Burgess, Matthew Burgess, Kevin Nguyen, and Darren Wong — as well as Michael and Matthew’s mother, Lesley Burgess, and two companies: 3Twelve Ventures and BDK Consulting.Photo by Bermix Studio on Unsplash Preference period clawbackThe critical withdrawals occurred within the 90-day period leading up to FTX’s bankruptcy filing on November 11, commonly referred to as the “Preference Period.” Under US law, customers who withdrew their crypto assets during this timeframe could potentially face lawsuits from the exchange’s creditors seeking to recover these funds, a process known as a “clawback” under bankruptcy regulations.The total value of these suspicious transfers is estimated at $157.3 million, with more than $123 million of that sum withdrawn after November 7, 2022. Michael Burgess is alleged to have received around $73 million of these illicit withdrawals.The lawsuit claims that the individuals leveraged their connections within FTX Group to ensure preferential treatment over other customers. In a specific accusation, Matthew Burgess is said to have engaged other FTX Group employees to expedite certain withdrawal requests from his FTX US exchange accounts while falsely representing the accounts as his own. 11th hour withdrawalsIn this way, Burgess and the other four defendants managed to get funds out when most other FTX customers couldn’t. The final withdrawals were executed only hours before FTX.com suspended all withdrawals on November 8, 2022, according to the lawsuit. As one commentator on X put it, “FTX employees were manually reviewing large withdrawals & pushing some ahead.”The legal filing also delves into the significant profits the defendants reportedly accrued from trading cryptocurrencies in the months leading up to FTX’s collapse. Even after their apparent departure from the FTX Group, Michael Burgess, Nguyen, and Wong actively traded through entities such as 3Twelve and BDK, with monthly trading volumes ranging from $100 million to $400 million.A noteworthy aspect of this activity is that their trading capital was allegedly derived from the FTX Group. The court filing goes on to claim that “Burgess, Nguyen and Wong received substantial transfers of digital assets and fiat currency from exchange accounts associated with FTX Group entities, including approximately 13.1 million FTT sent to Darren Wong, more than 1 million SOL sent to Michael Burgess, and nearly $4 million USD for ‘bonuses’ between Michael Burgess, Nguyen and Wong.” Retail clawback riskThis legal battle and the allegations against the former Salameda employees are being watched closely by other FTX bankruptcy stakeholders. The FTX Debtor has suggested that it will pursue clawbacks vigorously. That has concerned former retail customers who managed to withdraw assets in the final days before the platform collapsed. Equally, it is a worry for current FTX creditors who may have withdrawn some but not all of their assets before the exchange was shuttered.

Wemade Reports Loss of $30.6M Despite All-Time High Quarterly RevenueSouth Korean gaming company and blockchain giant Wemade disclosed its preliminary consolidated financial statements for the second quarter of this year, revealing an all-time high quarterly revenue of 159.3 billion KRW ($121 million). Despite this revenue, the company faced challenges, experiencing an operating loss of 40.3 billion KRW and ultimately recording a net loss of 29.4 billion KRW.Photo by Christian Wiediger on UnsplashNight Crows driving revenue growthThe Q2 revenue, marking a noteworthy year-on-year growth of 46%, can be attributed to the success of Wemade’s latest mobile game, Night Crows, according to local news outlet Newsis. This massively multiplayer online role-playing game (MMORPG) gained substantial traction since its launch in April. Drawing from this success, the game publisher has strategic plans to take Night Crows a step further by developing a blockchain version, with intentions to present it to global gamers within the current year.More games under developmentExpanding beyond Night Crows, Wemade is actively working on the development of other captivating gaming titles. These include Legend of Ymir, a game inspired by Norse mythology, and This Means War, a massively multiplayer online first-person shooting (MMOFPS) game.With a keen focus on blockchain ventures, Wemade is making significant strides in this domain. In May, the company forged a meaningful partnership by signing a memorandum of understanding (MOU) with Hub71, a prominent global tech hub based in the United Arab Emirates (UAE). Hub71 is undertaking initiatives aimed at nurturing Web3 startups and fostering the growth of blockchain technologies. Moreover, Henry Chang, Wemade’s CEO, attended WebX, the annual Japanese Web3 conference held in Tokyo last month, to call for game developers in Japan to participate in the burgeoning blockchain industry.Chang stated that capitalizing on its technological prowess, Wemade is actively identifying various business opportunities amid the rapid expansion of the global blockchain sector. He emphasized that the company is carefully preparing to make a seamless introduction of the blockchain version of Night Crows this year. According to Chang, Wemade is committed to investing in the creation of new games while strengthening the WEMIX ecosystem. A key element of this ecosystem is the WEMIX token, which supports three pivotal services: blockchain gaming platform WEMIX PLAY, DAO-driven NFT platform NILE, and decentralized finance service WEMIX.Fi.

A recent survey by Turkish crypto exchange Paribu reveals that 99% of Turkish investors are now familiar with digital assets, a significant rise from just 16% in 2020. Digital assets have emerged as the third most popular investment choice in Turkey, overtaking traditional options like real estate. Investors are now nearly twice as likely to consider digital assets over stocks or mutual funds, a trend seen across other Asian nations, where younger investors are favoring crypto over more conventional investments. In Indonesia, for example, digital asset investors reached 20 million this year, far surpassing the 12 million who trade on the country’s stock exchange. In the U.S., a recent Bank of America survey reported a similar trend, with younger investors increasingly gravitating toward digital assets.Photo by Burak Karaduman on PexelsHigh returns and future potential drive interest in digital assetsThe survey shows that Turkish investors are primarily attracted to digital assets for their high return potential, while some view them as the future of finance. Other motivations include fast transaction capabilities, as well as benefits like censorship resistance. According to Paribu’s spokesperson, Nergis Nurcan Karababa, crypto assets may experience higher adoption rates than traditional financial products, as more individuals anticipate mainstream usage of digital assets in the near future. Security a top priority for Turkish investorsSecurity remains a paramount concern for Turkish investors, particularly given the history of hacks and fraud targeting local exchanges. Paribu’s survey, which polled over 2,000 residents and 541 active traders, found that most Turkish investors demand a strong security system from their trading platforms. In recent years, Turkish exchanges have been targeted by hackers, with high-profile breaches impacting investor confidence. In June, an attack on BtcTurk, the country’s largest exchange, reportedly led to a $55 million loss from multiple hot wallets. An earlier collapse of the Thodex exchange in 2021 saw the disappearance of investor funds valued by Chainalysis at $2.6 billion, although local prosecutors cited a lower figure. Thodex’s founder was sentenced to over 11,000 years in prison, underscoring the severity of crypto-related financial crimes in Turkey. Rise in preference for local exchangesDespite security incidents, Turkish investors increasingly favor local exchanges, with 78% indicating a preference for Turkey-based platforms in 2024, up from 63% last year. This trend aligns with a global shift towards domestic exchanges as investors seek platforms regulated by local authorities, providing easier avenues for legal recourse. The collapse of international platforms like FTX has accelerated this trend, and countries such as Nigeria, India and Indonesia have issued new licenses exclusively for local exchanges, restricting foreign entities from operating within their borders. Turkey’s leading position in the MENA crypto marketTurkey ranks as the largest digital asset market in the Middle East and North Africa (MENA) region and is 11th globally in terms of adoption, according to Chainalysis. Between June 2023 and June 2024, Turkey received $137 billion in digital assets, placing it seventh worldwide for total transaction volume. This growing market highlights Turkey’s role as a key player in the global crypto landscape, as well as the increasing integration of digital assets into mainstream financial activities among Turkish investors.