Klasha and FOMO Pay join forces on cross-border payments

Do Kwon Loses Fight to Conceal Singapore RecordsDo Kwon, the founder of Terraform Labs has failed in his attempt to deny the United States’ Securities and Exchange Commission (SEC) from accessing company records in Singapore.©Pexels/George BeckerIn February, the SEC filed a complaint against Terraform Labs and its founder in a US court. The move followed an investigation that the agency had carried out into the collapse of a number of digital assets established by the company. The lawsuit claims that both the company and Do Kwon had engaged in fraud, together with the sale of unregistered securities to US citizens.Jurisdictional challengeLawyers for Do Kwon had claimed that in trying to access documents related to the Singapore-domiciled company, the SEC was acting far beyond its jurisdiction. According to court filings, his defense team argued that Do Kwon is a Singapore resident while Terraform Labs is a Singapore-based company that operates on a global basis and not specifically in the United States.The filing pointed to the fact that the Terraform Labs CEO had “limited contact with the US.” “Most of the company’s business is essentially global, and it’s not specifically aimed at the United States,” it stated.His lawyers had filed a request for the SEC to withdraw its documentation request. In a recent hearing, US District Judge Jed Rokoff turned down Terraform’s request. The documents are understood to be held by the Monetary Authority of Singapore (MAS) although the specific nature of the documentation sought remains unclear.The SEC claims that in founding the Terra US dollar stablecoin (TUSD) and associated cryptocurrency LUNA, Terraform Labs and Do Kwon were responsible for wiping out more than $40 billion dollars in value following their collapse. The Luna Foundation Guard (LFG), which was established to provide funds to keep the TUSD stablecoin at a $1 value, is another entity that the SEC intends to access documents from with the court’s permission. Singaporean police had stated last month that they had launched an investigation into the collapse of the TUSD stablecoin.Meanwhile, both the South Korean and US authorities are seeking the extradition of Do Kwon to face related charges. He was arrested last month in the southeastern European country of Montenegro where he was charged with having used forged documentation to enter the country. Although he had denied it on social media, in effect Do Kwon had been on the run from the reach of South Korean authorities over the course of a number of months, spending a portion of that time in Montenegro.Asset huntAn investigation by authorities in South Korea in recent weeks revealed that they were unable to find any assets held in the country owned by the Terraform Labs founder. The trail in chasing down any such assets has led to the United States. It is understood that Do Kwon bought real estate in the United States under his mother’s name. This is a common tactic for those who attempt to evade future confiscation of assets.Earlier this week, South Korean prosecutors confirmed that they are investigating a transfer of funds by Do Kwon to a leading law firm based in Seoul.

Indonesia witnessed a striking decline in cryptocurrency tax revenue for the year 2023, according to local media. 63% decreaseA report by Indonesian business and financial publication Kontan detailed a tax take drop to $31.7 million (Indonesian rupiah 467.27 billion). That tax collection is in sharp contrast to the partial collection period in 2022 when the crypto tax regime was initially introduced. It represents a drop of around 63%. The decline is part of a broader tax reform targeting the "digital economy" implemented in 2022, with the Indonesian government expressing the expectation that the reform would enhance tax collection, fostering a "healthy and fair taxation system."Photo by Nick Agus Arya on UnsplashDeclining transaction volumesDespite bitcoin's impressive surge of approximately 160% throughout 2023, the dip in crypto tax revenue was notable. The decrease is closely tied to a drop in transaction volumes over the same period compared to 2022. A report by CoinDesk Indonesia last week put that trading volume decrease at around 60%. Crypto transactions in Indonesia face dual taxation – a 0.1% income tax and a 0.11% value-added tax (VAT). Additionally, local crypto exchanges are subject to a special tax of approximately 0.04%, contributing to the national digital asset bourse. Disadvantaging local exchangesLocal exchanges in Indonesia, including prominent ones like Indodax, have voiced discontent with the high tax rates, contending that these levies are driving users towards unregulated offshore exchanges. Earlier this month Indodax CEO Oscar Darmawan called on the Indonesian government to review crypto tax rates. Darmawan highlighted that the cumulative taxes on crypto transactions often surpass the trading fees paid by users, posing a risk of users seeking more cost-effective alternatives. Local exchanges suggest that crypto transactions should only be subject to income tax, eliminating the VAT component. This proposal comes as Indonesia's Financial Services Authority (OJK) prepares to implement cryptocurrency regulations in early 2025. The aim is to align the taxation of cryptocurrencies with their market nature, possibly redefining them more as securities than commodities. Inadequate tax regulation can lead to a decline in local market activities, potentially resulting in capital flight to more favorable jurisdictions. Indonesia's situation serves as a reminder of the crucial need for policies that understand and adapt to the dynamic nature of the cryptocurrency sector. India is being similarly challenged. Local exchanges there have also complained of punitive taxation, which resulted in Indian users migrating to offshore exchanges. That scenario led indigenous exchanges to lobby the government to take action. The authorities have duly acted, flagging a number of global exchanges for operating illegally within India. It’s not all bad news for the development of digital assets within Indonesia. The country still ranks highly in terms of crypto adoption within the Asian region. Crypto was also floated as an election issue recently by Gibran Rakabuming Raka, a vice-presidential candidate in the upcoming election. The politician expressed his commitment to accelerating the country's position as a leader in the digital revolution. 

Milk Partners Achieves Integration with OK Cashbag, Elevating Reward Point UtilityMilk Partners, the operator behind a South Korean blockchain-powered platform delivering an integrated service for reward points, announced yesterday that its app, MiL.k, has achieved compatibility with OK Cashbag. This integration is notable as OK Cashbag enjoys a substantial presence in the nation, with a user base exceeding 20 million.Photo by Josh Sorenson on PexelsEnhanced utilization of reward pointsThrough this collaborative initiative, MiL.k aims to facilitate enhanced utilization of reward points for customers of both entities.MiL.k allows point collectors to swap their points across diverse domains like travel, leisure, and shopping, introducing a new approach to utilizing reward points. The company has been forging collaborations with notable companies, including conglomerate Lotte, convenience store chain CU, theater franchise Megabox, travel platform Yanolja, Malaysian budget airline AirAsia, and Indonesian loyalty platform GetPlus.Expanding Web3 servicesThe point exchange service is part of a strategic partnership agreement signed by Milk Partners and SK Planet, the operator of OK Cashbag, in June. Beyond loyalty programs, the two companies plan to maintain collaboration efforts to expand Web3 services. In particular, they will cooperate to enhance the ecosystem of the UPTN blockchain, jointly developed by SK Planet and Ava Labs, utilizing Avalanche Subnet technology.Cho Jung-min, CEO of Milk Partners, said that the utility of MiL.k has increased thanks to its partnership with OK Cashbag, whose points are accepted at numerous retailers both online and in-store. He added that the company will explore more partnerships to provide a wider range of tangible benefits to both corporate partners within the MiL.k alliance and app users.