Kiln raises $17M to fund APAC growth

Bank of Korea Explores Jeju, Busan, and Incheon for Citizen-Centric CBDC Pilot TestThe Bank of Korea (BOK) is reportedly reviewing three potential locations for a pilot test of a citizen-centric payment system utilizing the Korean Won central bank digital currency (CBDC). Instead of choosing Seoul, the nation’s capital city, the BOK is considering Jeju, Busan, and Incheon for the pilot. That’s according to local tech news outlet IT Chosun.The three cities have been selected as possible testbeds, and discussions with commercial banks are ongoing to move the project forward. Once a city is chosen, the BOK will collaborate with local retailers, including hypermarkets, to test the CBDC payment and distribution system.Photo by Ethan Brooke on UnsplashRegional currency modelThe CBDC test will be limited to a specific area, operating similarly to regional currencies issued by municipal governments to stimulate local economies. The CBDC wallet app will be available to all citizens, but its usage will be restricted to retailers in the designated area. Presently, Jeju, Busan, and Incheon already have their own regional currencies managed by local banks and financial institutions.However, implementing the CBDC system poses technical challenges. In remote tests last year, the BOK discovered that transaction speeds for small transfers were slower compared to traditional payment processing providers in regions outside the Seoul Metropolitan Area.Against this backdrop, the BOK seeks to recruit an unusually large number of tech experts in order to build a large-scale system for small payments. The bank has been actively hiring individuals for this purpose since the beginning of the year.CBDC test next yearWith the test scheduled for next year, the BOK aims to promptly select the test destination based on the system’s expected performance, estimated user numbers, and potential economic impact.While Busan is more or less shunned due to its large population, Jeju is emerging as a preferred choice. However, the final decision has been tentatively postponed due to internal issues within the BOK.Following the pilot test results, the BOK may gradually broaden the scope of the CBDC system. Meanwhile, in a similar development, China began its CBDC pilots in 2020 and has now expanded its CBDC use to 26 cities across 17 provinces.According to a BOK official, the Korean central bank is making seamless preparation for the test and engaging in discussions with commercial banks to explore their operating models and devise effective implementation strategies.

Korean Lawmakers Make Progress on Virtual Asset User Protection BillOn Tuesday, the subcommittee for legal deliberations under the South Korean National Assembly’s National Policy Committee reached a consensus during the first review of the Virtual Asset User Protection Bill, according to Yonhap Infomax.©Pexels/Andrea PiacquadioFirst review phaseThe bill is undergoing a two-phase review process before being legislated. During the first phase, the primary focus was on safeguarding customer assets and preventing unfair transactions. The second phase is expected to concentrate on market order regulations, including the issuance and disclosure of virtual assets.Application of Capital Markets ActSeveral stipulations were included in the approved draft of the Virtual Asset User Protection Bill during the initial review phase. These stipulations include prioritizing the application of the Capital Markets Act to virtual assets that are classified as securities, while excluding central bank digital currencies (CBDCs) from the definition of virtual assets to avoid any potential confusion. The bill also seeks to impose compensatory damages and penalties for any unfair trading practices, and establish a virtual asset committee responsible for investigating any unfair transactions in the digital asset market.The virtual asset committee will also engage in preliminary deliberations regarding the management, supervision, and monitoring of the digital asset market. The committee will carry out tasks assigned to it by the Financial Services Commission (FSC). Furthermore, the Bank of Korea has been granted the right to request data from virtual asset operators since virtual assets, although not currencies, are necessary to consider when establishing monetary credit and financial stability policies.No class action systemHowever, the introduction of a class action lawsuit system was not adopted, and details about inspecting virtual asset operators will be stipulated in a presidential decree rather than a law.Second review phaseFor the second review phase, the FSC will report several matters to the National Assembly. These will involve tasks such as establishing a regulatory framework for stablecoins, security tokens, and utility tokens. In addition, the agency will be responsible for creating a regulatory system for virtual asset valuation, advisory, and disclosure services, as well as an integrated computerized system that provides reliable and reasonable information on digital assets. The FSC will also explore ways to enhance the business conduct discipline of cryptocurrency operators by commissioning research from external organizations.Additionally, the FSC and the Financial Supervisory Service will work on supporting virtual asset exchanges to establish uniform standards for the circulation supply of virtual assets. The regulatory bodies will also enforce the requirement for transparent disclosure and strict internal control on virtual asset operators. Moreover, regulations will be developed to enhance virtual asset usability and remove any obstacles that may impede the development of innovative real-life services.

Suspected Malicious Activity Drains AnySwap Tokens via Multichain ExecutorAccording to an on-chain sleuth known as Spreek, a person is using the Multichain Executor to drain tokens associated with the AnySwap bridging protocol.Multichain is a cross-chain routing network, established and maintained by a Chinese developer team. It supports in excess of 25 blockchains and more than 1,100 tokens.Photo by Marek Piwnicki on Unsplash$100 million outflowThis revelation comes after abnormal outflows of over $100 million from Multichain bridges on July 7, which were flagged by the Multichain team. Spreek’s report via Twitter on July 10 states that the Multichain Executor address has been draining anyToken addresses across multiple chains and transferring them to a new externally owned account (EOA).Evidence provided in the report includes an Ethereum transaction, 0x53ede4462d90978b992b0a88727de19afe4e96f0374aa1a221b8ff65fda5a6fe, which called the “anySwapFeeTo” method on the Multichain Router: V4 contract. This transaction resulted in approximately $15,275.90 worth of anyDAI being minted on Ethereum, sent to the Multichain Executor, burned, and exchanged for the underlying DAI backing the asset.The funds from these transactions were sent to the following address:0x1eed63efba5f81d95bfe37d82c8e736b974f477b. Similarly, on the BNB Smart Chain (BSC), the Multichain Executor used the anySwapFeeTo function to convert $208,997 worth of anyUSDC into Binance-pegged USDC and sent them to the same address. Additionally, 50.80 anyBTC, equivalent to $39,251.43 at the time, was converted into Binance-pegged Bitcoin and sent to the address.In total, approximately $263,524.33 worth of tokens were sent to this address through the anySwapFeeTo method. Spreek suggests that this behavior could be part of the protocol’s normal functioning. However, a different account engaged in similar activity the day before and ultimately sold the drained tokens, indicating malicious intent.Potential exploitSpreek theorizes that the attacker may be exploiting the anySwapFeeTo function by setting fees to an arbitrarily large amount, allowing them to drain users’ funds. The function apparently permits setting any value, enabling the address to choose the total value of the token held in that anyToken.The Multichain incident has puzzled blockchain analysts, as it remains unclear whether it resulted from an exploit or if it was simply large token-holders moving their funds between networks. The mystery began on July 7 when over $100 million worth of tokens were withdrawn from the Ethereum side of Multichain’s bridges and transferred to wallet addresses with no prior transactions. This represented the majority of funds held on each bridge.Hack or rug pullThe Multichain team labeled these withdrawals as “abnormal” and advised users to stop using the protocol. However, they have not disclosed the source or nature of the anomaly. In response to the incident, stablecoin issuers Circle and Tether froze some of the addresses involved in the suspicious transactions. Chainanalysis, a blockchain analytics firm, has commented that the incident appears more like a hack or rug pull rather than a migration.Adding to the complexity, the Multichain team has reported that their CEO is missing, and they have shut down certain bridges due to losing access to some of the network’s multi-party computation network servers. There have been various concerns relative to Multichain since May. The situation continues to evolve, with ongoing investigations and efforts to mitigate any potential damage caused by the suspected malicious activity.