Hong Kong’s SFC appeals to digital asset investors to verify licenses

The U.S. Department of Justice has filed a civil complaint to seize roughly 127,271 Bitcoin linked to an alleged fraud scheme tied to Prince Group, a multinational conglomerate based in Cambodia. That’s according to a press release from the U.S. Attorney’s Office for the Eastern District of New York. The digital assets are currently valued at approximately $14.18 billion and are now in the custody of the U.S. government. Prince Group chairman Chen Zhi, now indicted by U.S. authorities, has been named as the mastermind behind the operation. FBI Assistant Director in Charge Christopher Raia said Chen oversaw an international crypto investment scam connected to a labor trafficking network that defrauded thousands of victims worldwide.Photo by Kanchanara on UnsplashOperations across 30 nationsSince 2015, Chen Zhi has headed the Prince Group, which operates in more than 30 countries. Under his direction, the group allegedly established scam compounds across Cambodia that promoted fraudulent crypto investment scams. The operations targeted victims through social media and messaging platforms with false promises of high returns. According to the allegations, funds were stolen and laundered rather than invested, and perpetrators often built trust over time before carrying out the fraud. Authorities in Vietnam have uncovered a comparable case that did not involve the seizure of cryptocurrency. According to Tech in Asia, Hanoi police confiscated assets worth $34 million from Nguyen Hoa Binh, chairman of the tech company NextTech. The seized property includes 597 gold bars, deeds to 18 properties, and two vehicles. Investigators allege that Binh and nine associates raised funds for the AntEx cryptocurrency project by selling 33.2 billion tokens to 30,000 investors in 2021, collecting around $4.5 million. The defendants are said to have taken part in fraudulent appropriation of assets and accounting violations. Tepid business climate in VietnamThese incidents come as Vietnam’s government works to define its stance on digital assets. According to a Cointelegraph report published earlier this month, the Vietnamese Ministry of Finance said that since the announcement of the country’s five-year digital asset trading pilot plan, no companies have applied to participate. Sharing this update, the vice minister of finance expressed hope that this pilot would launch before 2026. The report points to strict requirements as a likely reason for hesitation. Licensed crypto asset service providers must hold at least 10 trillion dong, about $379 million, in capital. They are also required to back all digital assets with real and tangible assets only, and the framework explicitly prohibits using fiat currencies or securities as backing. These rules leave few options that would attract retail or institutional investors. Gemini eyes Southeast Asia as adoption growsMeanwhile, global firms continue to look to Southeast Asia as activity increases. Dow Jones Newswires reported that Gemini, the American crypto platform founded by the Winklevoss brothers, plans to expand its footprint across the region. In an interview, Saad Ahmed, Gemini’s head of Asia Pacific (APAC), said the company was strengthening its regional operations. A Chainalysis study provides context, showing that the APAC region recorded the fastest growth in on-chain activity compared to other markets in the 12 months ended June. The region saw total crypto transactions rise to $2.36 trillion from $1.4 trillion a year earlier. Although Ahmed did not share investment figures, he said Gemini’s Singapore headquarters has grown to about 65 employees, up from 15 in the final quarter of 2023. He added that the expansion reflects the company’s view of Singapore as a key base for its operations in Asia and globally. Recent criminal discoveries and tightening regulations reveal how Southeast Asia’s crypto scene remains nascent. Governments are stepping up enforcement and shaping new frameworks even as global firms expand across the region, motivated by growing adoption. How policymakers and market players respond to these early tests will define the next phase of digital asset growth in Asia. 

Renault Korea Establishes Metaverse Space for Car EnthusiastsRenault Korea Motors made an announcement on Friday that it will establish the Renault Korea Hub, an immersive automotive experience located within a metaverse, according to a report by Korean news media Dailian. The company intends to commence operations of this unique venture in the upcoming autumn season.Photo by Richard Horvath on UnsplashThe Sandbox and Korean brandsThe Renault Korea Hub will operate within K-verse, a designated area of Korean brands within The Sandbox, a metaverse platform based on blockchain technology.The Sandbox metaverse has recently announced its latest Korean brand partners, and as part of this development, a land sale event is being organized where their adjacent land will be raffled off. The event is named “Hallyu Rising.” Hallyu or the Korean Wave is a cultural phenomenon that has experienced a significant surge in global popularity since the 1990s, mainly thanks to its pop songs and TV shows.During the land sale event, users have the chance to acquire land adjacent to various prominent brands associated with Korean culture. This will be made possible through raffles and auctions facilitated by the metaverse platform. Other notable partners besides Renault Korea are Channel A, a TV broadcasting network; Netmarble, a game publisher; and CJ ENM, an entertainment company.Unique experiences for car enthusiastsThe Renault Korea Hub, the first of its kind in Korea, will provide a unique space for automobile enthusiasts to indulge in a diverse array of experiences and games. As per the automaker’s announcement, visitors will have the chance to engage in activities like developing their own vehicle designs.Visitors will have the opportunity to experience Renault Korea’s vehicles in voxel form, allowing them to explore the technology, design philosophy, and stories associated with each vehicle. A voxel can be understood as a 3D counterpart to a 2D pixel, representing a value on a regular grid in 3D space.Renault Korea CEO Stéphane Deblaise stated that the carmaker intends to continue its pursuit of diverse Web 3.0-based activities centered around metaverses and non-fungible tokens (NFTs). He said the automaker’s projects aim to establish a connection between customers’ mobility experiences and their digital lives. Deblaise also highlighted that these projects will undergo further development through the integration of artificial intelligence (AI) technologies.Storytelling contestEarlier this month, Renault Korea introduced the storytelling contest titled “create your SM6,” which concludes today. This campaign inspires customers to utilize emerging AI technologies to design their own SM6 vehicles and transform them into NFTs. The SM6, Renault Korea’s midsize sedan, initially debuted in 2016 and has undergone subsequent facelifts to enhance its features and aesthetics.The top ten performers in the storytelling contest, who create captivating renditions and stories featuring the SM6, will be rewarded with utility NFTs and KLAY, the native token of the Klaytn network. The first-place winner will receive a prize package consisting of 1 million KRW ($750) worth of KLAY, along with six SM6 NFTs.The announcement of the winners is scheduled to take place between May 31 and June 9. Following the announcement, the airdrop of rewards will be conducted from June 30 to July 7.

Hong Kong’s insurance regulator is drafting rules that would bring insurers’ cryptocurrency exposure under a risk-based capital framework. According to Bloomberg, the Insurance Authority of Hong Kong is preparing a risk-based capital framework that would impose a 100% risk charge on insurers’ crypto holdings. The proposal distinguishes among crypto exposures, assigning stablecoin investments risk charges based on the fiat currency backing the Hong Kong-regulated token rather than applying a uniform treatment. The regulator is also considering capital incentives to channel insurers’ investment into infrastructure projects supporting Hong Kong or mainland China, including those listed or issued within the city. The Insurance Authority said the regime is designed to bolster the industry while promoting broader economic development. A public consultation on the rules is scheduled to run from February to April, ahead of any legislative submission.Photo by Vlad Deep on UnsplashStablecoin licensing focuses on robust reservesSeparately, the Financial Services and the Treasury Bureau is advancing other regulatory initiatives in the digital asset space. Secretary Christopher Hui indicated that the first batch of stablecoin licenses is expected to be issued early next year. According to the Hong Kong Economic Times, Hui noted that the government had received 36 stablecoin license applications by the end of September, following the implementation of the Stablecoins Ordinance in August. Regulators are prioritizing applicants that demonstrate strong reserve management, price stability, and robust anti–money laundering (AML) controls. Hui added that the government is currently collaborating with the Securities and Futures Commission (SFC) to finalize licensing rules for virtual asset trading platforms and custodial service providers, with proposals expected to reach the Legislative Council next year. StanChart and Ant’s tokenized depositsWhile regulators refine the rulebook, the traditional banking sector is moving forward with the technology underpinning the digital pivot. Standard Chartered has collaborated with Ant International to launch a tokenized deposit solution on Whale, Ant’s blockchain-powered treasury management platform. As reported by Tech in Asia, the solution enables real-time transfers in Hong Kong dollars, offshore yuan, and U.S. dollars. This initiative falls under the umbrella of Project Ensemble, a program launched by the Hong Kong Monetary Authority in March 2024 to shape the city’s tokenization ecosystem. Market headwindsThese developments follow the crypto sector’s entry into Hong Kong’s equity market. According to Bloomberg, HashKey Holdings, a licensed exchange operator, listed on the Hong Kong Stock Exchange on Dec. 17, raising HK$1.6 billion ($206 million). While shares initially debuted above the offer price, they had fallen approximately 15% to HK$5.69 by Dec. 22. The lackluster performance coincides with a broader pullback in the crypto market. Bitcoin is currently trading below $89,000, roughly 30% off its October peak. Institutional caution is also evident in global flows. According to CoinShares, crypto investment products recorded $952 million in net outflows for the week ending Dec. 20. Ethereum and Bitcoin products led the exit with outflows of $555 million and $460 million, respectively. Conversely, altcoins XRP and Solana bucked the trend, seeing inflows of $62.9 million and $48.5 million. James Butterfill, head of research at CoinShares, attributed the negative sentiment to delays regarding the CLARITY Act, a U.S. bill designed to clarify digital asset regulation, and continued selling by whale investors.