India’s judiciary turns down plea to formulate a crypto regulatory framework

Bybit Extends Service Offering to Include LendingDubai-headquartered crypto spot and derivatives trading platform Bybit announced on Tuesday that it has expanded the range of services it offers to now also encompass crypto lending.Photo by Traxer on UnsplashHourly interestIn the announcement which has been published to the platform’s website, the company set out the nature of the Bybit Lending product. “With Bybit Lending, users can deposit their unused cryptocurrencies into Asset Pools, which will be lent out to borrowers,” the service update outlines.Expanding on the features that the new service offering brings with it, the crypto platform outlines that customers will have the ability to accrue interest on an hourly basis. That interest will be calculated at a variable rate, with a variance in the rate depending upon the level of borrowing activity. “In extreme cases where there are no borrowers at all, the interest rate could drop to 0%,” the company clarified.Low risk claimsBybit points out that “loaned assets are kept safe by Bybit’s strict risk management system, enabling you to earn returns with peace of mind.” While this is comforting to hear, it remains to be seen to what extent crypto market participants will take this statement at face value.2022 proved itself to be a graveyard for most of the leading crypto lending firms, and with that, such failures also proved to be a graveyard for the hard earned funds of retail market participants in their hundreds of thousands. Many are dubious about the integrity and sustainability of the crypto lending model, at least at a retail level.Withdrawal restrictionsBybit added that the product facilitates flexible redemptions. However, in an accompanying note, it added that the withdrawal of funds is dependent upon “ the funds in the Asset Pool [not being] fully lent out and you have not exceeded your Daily Withdrawal Limit.”It’s important to note that as many of the failed crypto lenders were getting further and further into difficulty in 2022, they added more arduous withdrawal limits and withdrawal conditions as a mechanism to stem the bleeding that was the outward flow of deposits against a backdrop of a deficit in customer funds held by these platforms.In further marketing of the product on Twitter, the company is claiming that customers can benefit from interest rates of up to 16.46%. While one could take the view that limited promotion of exceptionally high interest rates is harmless, the lesson learned from recent crypto lender failures is that such platforms were offering excessive and unsustainable interest rates as a mechanism to reel in retail deposits, only to later proceed to mismanage those funds.Competing offeringsBybit is not alone in offering this service. While a plethora of lending services exited the market via bankruptcy, exchanges such as OKX and KuCoin have their own variations on lending. OKX extends a loan facility to platform users proportionate to digital assets the user has deposited on the platform. Seychelles-based KuCoin offers a lending service across a broad spectrum of crypto assets.The intent of US based platforms Coinbase and Kraken in this regard has been retarded due to the actions of US regulators. Kraken fell foul of the Securities and Exchange Commission (SEC) relative to its staking service and paid a $30 million fine as a consequence. Meanwhile, Coinbase shelved plans to launch lending-based services in September 2021 having been warded off the idea by the SEC.

Hacking Attempts on Upbit Reach 160,000 in First Half of the YearThere have been approximately 160,000 hacking attempts on Upbit, Korea’s largest cryptocurrency exchange, in the first half of this year alone, according to a report submitted by Upbit’s operator Dunamu to lawmaker Park Sung-joong of the National Assembly’s Science, ICT, Broadcasting, and Communications Committee.“Cryptocurrency hacking incidents are increasing both domestically and internationally, and hacking attacks on exchanges such as Upbit, which have daily trading volumes exceeding KRW 2 trillion, are a serious issue,” Park said.Photo by Clint Patterson on UnsplashAn uptick in hacking attemptsThe data revealed that the number of cyber breach attempts in the first half of the year totaled 159,061–2.17 times higher than the number of attempts in the first half of last year, which stood at 73,249.Hacking attempts on Upbit have been steadily increasing in recent years, from 8,356 in the second half of 2020 to 34,687 and 63,912 in the first and second half of 2021, respectively. In the first half of last year, there were 73,249, and 87,242 in the second half. Notably, the exchange suffered losses of approximately KRW 58 billion (approximately $43 million) from a hacking attack in 2019.Ramping up securitySubsequently, Dunamu has taken action to enhance security by managing over 70% of its assets in cold wallets and operating hot wallets in a distributed structure instead of a singular one. Hot wallets refer to online crypto wallets, whereas cold wallets are crypto wallets that are offline and disconnected from the internet. Hot wallets offer the advantage of direct deposits and withdrawals, but they have weaker security levels — most known exchange hacks have thus occurred through this medium. On the other hand, cold wallets store private keys on offline sources like external hard drives and portable storage devices, making real-time trading difficult but providing better security and stability.“We have taken various preventive measures since the hacking incident in 2019, such as operating hot wallets in a distributed manner. There have not been any successful cyber breaches to date,” Upbit said.Regarding the role of the Ministry of Science and ICT in managing and overseeing crypto hacking incidents, Park pointed out that this still remains ambiguous. “The Ministry should conduct large-scale white-hat hacking tests and security assessments for crypto exchanges that are frequently faced with hacking attempts, as well as for hospitals and subway systems that manage large amounts of personal information,” he said.

Wemade’s NILE Launches Ticket NFT Sales for Blockchain-Assisted Golf TournamentNFT Is Life Evolution, better known as NILE, commenced the sale of ticket NFTs for the WEMIX Championship 2023, a women’s golf tournament in South Korea, on the NILE Marketplace at noon (local time) on October 18. NILE is a decentralized autonomous organization (DAO) and NFT platform, which operates on the WEMIX3.0 mainnet of South Korean blockchain game developer Wemade.Photo by Robert Ruggiero on UnsplashWEMIX Championship 2023The WEMIX Championship 2023, touted as the world’s first blockchain-assisted golf tournament, will take place from November 18 to 19 at Haeundae Beach Golf and Resort in Busan. The sports event will see participation from 24 players who are members of the Korea Ladies Professional Golf Association (KLPGA), including the top 20 athletes with the most WEMIX points, as they vie for victory in the season-ending competition.Ticket NFTs for perksThe competition is leveraging blockchain technology across all its operations. Specifically, NILE is introducing Real World Event NFTs, which consist of two main types: “ticket NFTs,” which serve as admission tickets and vouchers, and “prize NFTs,” which are awarded to the competition’s winners.Ticket NFTs are dynamic NFTs that provide a range of benefits depending on the selected tier. These benefits encompass souvenirs, food vouchers, and access to VIP-reserved facilities. There are two tiers to choose from: GROUND and NILE Suite. Golf enthusiasts can purchase these NFTs using WEMIX dollars (WEMIX$) through either the WEMIX Wallet or the una Wallet.In addition, ticket NFT holders can verify their NFTs on the decentralized communication platform, PAPYRUS, to join a special channel dedicated to the WEMIX Championship 2023, where spectators can stay informed about the latest competition news and engage in real-time interactions with one another.Looking ahead, Wemade plans to introduce additional sports events that utilize blockchain technology, aiming to provide fresh and engaging experiences while fostering a culture where both athletes and fans can fully enjoy sports competitions.