Fraud Defense Sees Terraform Labs Pursue Access to FTX Wallets

Taiwan Proposes New Crypto Business CategoryWith regulation having trailed the crypto innovation, more recently it seems like every day brings further developments, with the latest installment seeing Taiwan take a significant step forward. Officials in Taipei are proposing the classification of crypto regulations within their own novel business category.Photo by Jack Brind on UnsplashFostering self-regulationThe move aims to potentially allow cryptocurrency-related companies to establish industry associations, ultimately fostering the creation of self-regulatory guidelines. The Ministry of Economic Affairs, in a recent announcement, unveiled its draft amendment to the Standards of Classification of Commercial Group regulations. This proposed amendment centers on the inclusion of a distinct category for digital asset services.An official from the economic ministry informed The Block that the freshly introduced business category outlines the scope of operations within the cryptocurrency sector. This encompasses various activities, such as cryptocurrency to fiat or digital token exchanges, facilitating cryptocurrency transfers, offering services for crypto storage and management, and providing assistance related to cryptocurrency issuance or sales.The official further elaborated that cryptocurrency firms will be permitted to form industry associations once the proposed business category is successfully incorporated into the relevant regulations. Seeking public input, the ministry anticipates finalizing the amendment in collaboration with the Ministry of the Interior in either mid- or late-October.Encouraging trade associationsBy allowing the establishment of industry associations, cryptocurrency companies can proactively devise self-supervisory rules that address industry-specific challenges and concerns. This move is anticipated to bolster transparency, security, and responsible conduct within the cryptocurrency ecosystem.Taiwan’s approach to virtual asset services providers (VASPs) has mandated compliance with anti-money laundering laws since the implementation of anti-money laundering regulations by the Financial Supervisory Commission in July 2021. However, the overall industry remains relatively unregulated within the country.Binance, the world’s largest cryptocurrency exchange, has recently embarked on the process of obtaining registration for anti-money laundering compliance under the FSC.Regulatory guidelines being draftedAs the regulatory landscape evolves, Taiwan’s FSC, which assumed its role as the principal regulator overseeing the crypto industry in March, is actively formulating comprehensive guidelines. These guidelines will cover trading and payment aspects associated with cryptocurrencies for VASPs.An FSC official revealed that the agency plans to unveil the VASP guidelines by the end of September. It’s understood that the guidelines will comprise thirteen regulatory principles. It’s believed that the issuance of crypto assets will be permitted but that stablecoin issuance will be prohibited. One prerequisite for the issuance of digital assets will be a requirement to accompany that issuance with a comprehensive whitepaper, detailing fundamental and necessary information that investors can review, relative to the token offering.Taiwan’s proposition of a novel business category signifies a pivotal move towards enhanced self-regulation and industry cohesion within the cryptocurrency sector. As the regulatory framework takes shape, the introduction of self-regulatory guidelines is poised to contribute to the responsible growth of the cryptocurrency industry in Taiwan.

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.

AEON, a modular payment protocol that aims to standardize and unify crypto payments, has launched a QR code payment system on the BNB Chain, with a view towards expanding crypto payments in Southeast Asia. The project clarified in a press release published on Nov. 11 that its BNB-based QR code payment system has been established in collaboration with Terminus, a payment association project that bridges crypto and real-world transactions through banks, e-wallets and fiat settlement networks. The new service means that merchants can now access AEON’s payment system without having to acquire additional hardware, while crypto payments are settled in fiat currency. AEON believes that the new offering provides greater convenience for users and merchants, while also supporting the BNB Chain ecosystem through the promotion of a seamless payment experience at offline locations throughout the Southeast Asian region.Lara Jameson on PexelsIntegrating with Asian payment networksUsers can now rely on assets such as Bitcoin (BTC), Ethereum (ETH), Tether (USDT), USD Coin (USDC) and Binance Coin (BNB) as a source of funds for payments, which can be made in-store by scanning a QR code via a network of merchants throughout Southeast Asia. Once a transaction is confirmed, funds are converted to fiat currency in real time. The offering minimizes friction for the merchant, making it easy for them to accept crypto as a means of payment. This scan-to-pay feature has now been integrated with national payment networks like VietQR, a money transfer service in Vietnam that enables customers to scan and pay across the mobile apps of the Southeast Asian nation’s banks. Similarly, AEON has integrated with another such service in Thailand known as ThaiQR, which is supported by a number of leading Thai banks.  Connecting Web2 with Web3In an article posted to X last month, Terminus outlined that acting as a “payment association” isn’t just a label but an attempt by the company to take an approach that seeks to connect Web2 with Web3 in a manner previously thought impossible. It believes that it is creating a powerful ecosystem by taking disparate payments providers and joining them together via a cohesive payments association. In bridging Web2 and Web3 Terminus says that it is laying “the groundwork for a future where payments are not only efficient but universally accessible.” Network integrations seem to be key where crypto payment solutions providers are concerned. With that, AEON has been active in bringing about other such integrations beyond this collaboration with Terminus. In September, it entered into a partnership with Singapore’s Alchemy Pay, a crypto-to-fiat payment gateway, with a view towards combining Alchemy’s expertise in payments with AEON’s payments infrastructure and protocol. In October AEON integrated with the TRON layer-1 blockchain network. The collaboration means that decentralized applications within the TRON ecosystem can accept crypto payments over AEON’s payments infrastructure.