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D&D nukes NFT ban, ‘Kill-to-Earn’ zombie shooter, Illuvium: Zero hot take — Web3 Gamer

Is play-to-earn really dead or will the dead rise again? Teen makes $1.6M playing Yuga Labs’ NFT game, and first impressions of Illuvium: Zero.

In this inaugural edition of Cointelegraphs monthly Web3 gaming column, we highlight some of the top stories and events in the blockchain gaming space over the past few weeks, as well as upcoming releases.

Fortnite player sells Dookey Dash prize

It has been a little over a month since NFT behemoth Yuga Labs, the company behind Bored Ape Yacht Club (BAYC) and other top NFT collections, rolled out the skill-based game and NFT mint, Dookey Dash. 

Sent on a quest by a dog called Gary, players have to navigate through the sewers, dodging obstacles and collecting power-ups in pursuit of a golden key.

For three weeks, holders of Sewer Pass NFTs competed for the top spot on the leaderboard and different prizes. Though BAYC and sister collection Mutant Ape Yacht Club holders could claim a free pass, buying one wasnt cheap. The floor price currently stands at 2.4 Ether (ETH) ($3,888)

Thats a lot to play Temple Run in a toilet.

Yuga Labs reported the game was played more than 7.5 million times, equivalent to 80 years of game time and an average of about 28 hours per pass. Over 9,000 pass holders used $APE to purchase boosts, about one-third of active players. That said, it is not clear how many individual people played the game. Only 51% of the Sewer Passes have unique owners, meaning a whole lot of people are hoarding multiple passes. 

A bonus round of the game, Dookey Dash: Toad Mode, closed its leaderboard on March 1. 

The top prize, The Key, went to Kyle Jackson, better known as Mongraal on Twitch and YouTube. The 18-year-old professional Fortnite player, no doubt treasuring the very important loot he had just acquired, promptly listed The Key for sale on OpenSea.

Though he wanted 2,222 ETH ($3.6 million) for it, he ultimately sold it this week for 1,000 ETH ($1.6 million) to American scrap metal CEO Adam Weitsman.

According to Spencer Tucker, Yuga Labs new chief gamer officer, the game is just the beginning of how the company is thinking of connecting the dots between NFTs, gaming and community engagement. 

We want these things to be fun and weird, while also continuing to push the boundaries of what people perceive of the NFT industry, he said.

More than a jpeg, its all about utility, innovation, creating interactive experiences and hopefully onboarding new players to the web3 space. 

Dookey Dash
Dookey Dash gameplay. Source: Yuga Labs

Dungeons & Dragons reverses NFT ban

Wizards of the Coast, the publisher of Dungeons & Dragons (D&D), was forced to walk back proposed changes to its Open Game License (OGL) in January. For more than two decades, its OGL has allowed people to make D&D derivative projects, like graphic novels and plays.

Among the now-dropped changes was a ban on NFTs and other blockchain integrations. Ironic, considering Wizards of the Coast is owned by Hasbro, which itself debuted a Power Rangers NFT collection on the Wax blockchain last year.

The company also sought to introduce royalties payable by content creators of a certain size and new powers for Wizards to terminate the license of projects.

The drama impacted U.S. company Gripnr, which is building a D&D game with NFT integrations called The Glimmering. Its CEO and co-founder, Brent McCrossen, said he was  thrilled that the updates had been reversed and that the published rules and lore of D&D had been moved to a Creative Commons license, making it freely available for use in perpetuity.  

We were not going to simply pack up our belongings and head home, he said.

NFTs and other potential emerging technologies are not a valid reason for revoking the OGL. We will object in a similar manner to any potential future attempts to restrict blockchain use; it is fundamental to GRIPNRs core business, he added.

While the Wizards of the Coasts ban hasnt ultimately panned out, it follows similar moves to ban NFT mods from Minecraft and Grand Theft Auto servers. 

Yet whereas Grand Theft Auto makers Rockstar Games sent out cease and desist letters to builders shortly after the ban was announced, Mojang Studios which is owned by Microsoft doesnt seem to be enforcing it, as NFT games still exist on Minecraft servers.

D&D
Cover art from the D&D Players Handbook. Source: Wizards of the Coast

Square Enix to Launch NFT-based game Symbiogenesis

Elsewhere on the dark and violent crossroads between traditional and Web3 gaming, Square Enix has released more details about its upcoming NFT game. Symbiogenesis was first announced in November as an Ethereum-based game. Its since switched to Polygon and plans to launch in Spring this year. 

Among traditional game makers, Square Enix has been one of the most bullish on Web3. Its president, Yosuke Matsuda, doubled down on that position in his New Years letter in January where he predicted the growth of a more mature blockchain gaming market over the coming year.

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The game will be set on a fantasy floating continent and players will have to unlock storylines through NFTs, which can be bought, traded or earned through completing missions. 

Other AAA gaming studios in East Asia are also getting involved in Web3 projects. But while theyve generally been more willing to experiment than their U.S. counterparts, there are still some holdouts. 

The rumor in Kyoto is that the powers that be at Nintendo HQ arent keen on NFTs, despite some vague public statements of interest so dont expect Pokemon NFTs any time soon.

And even the crypto-curious firms remain cautious. Nobody is risking their most valuable IP just yet, preferring to test out the response with lesser-known titles.

Final Fantasy
Final Fantasy XVI, one of Square Enixs flagship titles, is set to come out later this year. Source: Square Enix

Wagyu Games rolls out kill-to-earn zombie shooter

One of the most highly anticipated Web3 games of the past few months, Wagyu Games rolled out its first-person shooter zombie game, Undead Blocks, at the end of February.

With all the hallmarks of a classic zombie shooter including a multiplayer mode Undead Blocks claimed around 2,500 active daily players during its beta. 

But the full launch now includes kill-to-earn features for NFT holders. Players can earn in-game token ZBUX for slaying the living dead, which can be traded or used to buy NFT weapons and upgrade. The game also has a second token, UNDEAD, for governance that can be staked for rewards.

The company has been hyping up the rewards for players at a time when other games are becoming more cautious in their approach to rewards and tokenomics. There are plenty of contenders out there vying to become the project that proves theres a sustainable way to share rewards with players, but nobodys done it yet.
Play-to-earn has also fallen out of favor as a driver of growth. A Blockchain Games Alliance survey in 2021 found 67.9% of gaming professionals predicted play-to-earn would be a significant growth driver. A similar survey in January saw that number drop to just 22.5%.

Undead Blocks
Undead Blocks gameplay. Source: Twitter/Immutable

Hot take Illuvium: Zero

In January, Illuvium rolled out the private alpha for Illuvium: Zero, a building sim based around collecting and processing natural resources on Illuvium land NFTs. The Aussie companys third game followed quickly on the heels of the December private beta release of Overworld.

Think SimCity BuildIt but more purple. 

Reviewing an alpha is arguably a grossly unfair thing to do. Alpha versions of games are still in their early days. Theyre supposed to have glitches and lack full gameplay. The fact that its almost as good as BuildIt (not to be confused with non-mobile versions of SimCity) says far more about BuildIt than it does about Illuvium.

Read More: Better than Axie Infinity: Kieran Warwicks 2032 plan for Illuvium

But it follows similar principles. Theres a select set of buildings you can add to your land, some of which require unlocking by building other buildings. You can then use these buildings to extract resources and store them. Im curious to see what these resources will ultimately be used for. 

Despite numbers being capped at 6,500 players, Illuvium says that the game has been the most popular of the three it has released, potentially due to its availability on mobile devices and the use of NFTs that players have already invested in.

Regarding future versions of Illuvium, the team has several plans to enhance graphics and gameplay, said co-founder Kieran Warwick.

Illuvium: Zero
Illuvium: Zero gameplay. Source: Illuvium

Whats coming up

Gods Unchained mobile version Gods Unchained announced plans for a mobile version in February. Its currently rolling out the pre-alpha to active community members and requesting feedback. The test period will end on March 22.

Chain Monsters Looking a little bit Pokmon-esque, the early access version of Chain Monsters will hit the Epic Games Store on March 6. Also available on iOS and Android, players can explore the open world of Ancora, catching and battling monsters.

Illuvium: Beyond Illuviums fourth game will be a card-collecting game where players earn points based on how their cards are customized and by completing milestones within their collections. 

Otherside Second Trip Yuga Labs will launch a Second Trip to the Otherside at some point in late March, featuring updates to avatars and other new features. It will be followed by a second experience, Legends of the Mara, which will be a stand-alone 2D experience powered by Apecoin.

Got tips, questions or comments? Please direct all vitriol, abuse and declarations of love to me on Twitter @quinnishvili. 

$3M OKX airdrop, 1-hour due diligence on 3AC, Binance AI — Asia Express

OKX reimburses $3M to users after alleged market manipulation incident, Binance unveils AI generated NFTs and FTX Japan users made whole.

Our weekly roundup of news from East Asia curates the industrys most important developments.

OKX airdrop after token trading fiasco

OKX will airdrop 3,014,381 Tether (USDT) to users who suffered losses as a result of the Celestial (CELT) token trading incident, the cryptocurrency exchange announced on March 1. On Feb. 26, Celestial revealed the development of a novel blockchain game, followed by extensive social media campaigns promoting the projects alleged backing by OKX. Shortly afterward, the price of CELT pumped nearly 100% in two days before plummeting over 60% after OKX clarified it had no affiliation with the project other than a $100,000 investment from OKX Ventures in November 2021. 

“On Feb. 27, many influencers on social media promoted the [CELT] project by claiming that it was the Son of OKX, such actions were not authorized by the OKX exchange.”

After an investigation, OKX concluded that there was evidence of malicious market manipulation associated with the incident. The exchange explained shortly afterward that it froze 714,381 USDT held in five accounts suspected in the market manipulation and clawed back 1.3 million USDT from Celestial developers.

Combined with 1 million USDT of its own money, OKX will airdrop a total of 3 million USDT to users who purchased CELT between Feb. 25, 12:00 pm Hong Kong time and Feb. 28, 12:00 pm Hong Kong time and suffered losses. The airdrop will be delivered to affected users within the next 48 hours. 

Price action of CELT tokens before and after the alleged insider trading incident. (CoinMarketCap)
Price action of CELT tokens before and after the alleged insider trading incident. Source: CoinMarketCap

Although experts disagree on its supposed transparency, OKX has also decided to double down on its proof-of-reserves (PoR) model. On March 2, the exchange stated that its upcoming PoR report would enhance transparency by allowing anyone to download the full liability Merkle tree and that users can verify all client deposits are accounted for and claims it guarantees solvency by comparing net equity,” via novel zero-proof methods.

In its most recent update, OKX claimed that it held $8.6 billion worth of Bitcoin (BTC), Ether (ETH) and Tether on the exchange. OKXs next monthly PoR publication will take place on or around March 20.

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Binance and AI NFTs

On March 1, cryptocurrency exchange Binance launched a novel AI product dubbed Bicasso. Binance CEO Changpeng Zhao (CZ) said you can turn your creative visions into NFTs with AI by uploading an image with a limit of 50MB and a description of the uploaded picture.

There is currently a waitlist as AI NFT minting was limited to a maximum of 10,000 collectibles. CZ has apparently taken an interest in exploring AI after the popular chatbot ChatGPT reached 100 million users just two months after its launch. 

Demo Bicasso NFTs generated by CZ (Binance)
Demo Bicasso NFTs generated by CZ, Source: Binance

FTX Japan nearly completes withdrawals 

FTX Japan users have withdrawn almost all of their assets since withdrawals reopened on Feb. 21, the Japanese subsidiary of bankrupt cryptocurrency exchange FTX revealed in a Feb. 28 update. According to FTX Japan, the exchange had 80 Ethereum and 28.48 Bitcoin left unclaimed, worth $793,000 at the time of publication, among other residual assets. 

Previously, FTX had disclosed that it held 6.672 billion Japanese yen ($48.83 million) in users assets before regulators halted exchange in November as part of international bankruptcy proceedings. As Japanese law required exchanges to segregate client assets from their own, many users reported being able to withdraw their FTX Japan balance in full, albeit first transferring their account to Liquid Japan, a related entity. 

“We would like to sincerely apologize for causing great concern to our customers in connection with the bankruptcy of our parent company, FTX Trading Limited. We have resumed withdrawal and withdrawal services from Liquid Japan from Feb. 21, but services related to normal transactions have been suspended. Thank you for your understanding.”

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Russia and Chinas blockchain friendship

The Credit Bank of Moscow (MCB) has issued the first blockchain letter of credit for more than 100 million Chinese yuan ($14.5 million).

In international commerce, sellers in one country typically ship purchased goods to buyers in another country and present a letter of credit to the intermediary bank for payment. According to the bank, the advantage of a digital bank guarantee is that the beneficiary does not need to wait for the paper version and make a separate request to the bank to confirm the authenticity of the issued document.”

The letter of credit is minted on MCBs Masterchain blockchain network and is displayed to all three parties of international commerce. It cannot be altered or falsified.

This is the first digital letter of credit in the market which was issued in yuan, through the Masterchain system, said Natalya Bahova, director of the international and structured finance department at MCB. Most foreign trade contracts are serviced in Chinese currency, and the demand for payments in yuan is only growing.

The decision will be especially relevant for large groups of companies that have many subsidiaries that accept letters of credits in large quantities and on a regular basis.

BitFlyer CEO wants to reinstate himself 

Yuzo Kano, the co-founder of BitFlyer Holdings, wants to return as CEO and take Japans largest cryptocurrency exchange public, according to a Feb. 26 Bloomberg report. Kano, who owns 40% of BitFlyer, stepped down in 2019 after the exchange was ordered to adopt stronger Anti-Money Laundering measures. Since then, the exchange has been embroiled in a drama culminating in a proposed sale to Singaporean fund ACA Partners in 2022, which Kano derailed.

The blockchain executive alleges that ACA and current management worked together to sell the exchange on the cheap, which is why he quashed the sale. BitFlyer currently has three million accounts and handles more Bitcoin transactions than any other exchange in Japan. If he returns, Kano aims to introduce stablecoins, build a token-issuance operation, and potentially open up its Miyabi blockchain technology to the public. He plans to bring forth a reinstatement proposal at a shareholder meeting next month. 

Former BitFlyer CEO Yuzo Kano. (Beyond Blocks Tokyo)
Former BitFlyer CEO Yuzo Kano. Source: Beyond Blocks Tokyo

Voyagers 1-hour due diligence on 3AC 

According to bankruptcy court documents published on Feb. 28, now-broke cryptocurrency broker Voyager Digital barely verified the now-also-broke Three Arrows Capitals operations and financial standing before extending it a line of credit in early 2022. The Mr Brosnahan mentioned is the chief commercial officer of Voyager and Mr Whooley is Voyagers Treasury director:
 

“On February 28, 2022, the first and only diligence call was held between Voyager and 3AC. Mr. Brosnahan recollected that call lasting 30 minutes, while Mr. Whooley recollected it lasted an hour.”

Executives who attended the call said 3ACs co-founder Kyle Davies and employee Tim Lo both participated. During the questions and answers session, Brosnahan concluded that 3AC only managed its founders assets, was involved in some venture projects,” and, among other items, would not take a position larger than 1-3% of circulation of any given altcoin, to protect its liquidity. In a subsequent follow-up, 3AC provided a one-page document with the firms logo stating the firms net asset value was $3.729 billion. No other evidence or accompanying financial statements were presented:

3AC's AUM letter (Voyager)
3ACs assets under management letter provided as part of due diligence. Source: Voyager

We all know how that ended: 3AC filed for bankruptcy in June and Voyager Digital made a similar filing in July. Voyager lent a total of $654 million to 3AC that it has yet to recoup after the former suffered severe trading losses as a result of the ongoing crypto winter. The loan accounted for nearly 60% of Voyagers lending portfolio. 

Hong Kong crypto frenzy, DeFi token surges 550%, NBA China NFTs — Asia Express

Our weekly roundup of news from East Asia curates the industry’s most important developments. Hong Kong moves bullish On Feb. 20, the Securities and Futures Commission (SFC) of Hong Kong launched a consultation on its proposed regulatory requirements for digital asset trading platforms. The SFC requires the licensing by June of all cryptocurrency exchanges operating […]

Our weekly roundup of news from East Asia curates the industrys most important developments.

Hong Kong moves bullish

On Feb. 20, the Securities and Futures Commission (SFC) of Hong Kong launched a consultation on its proposed regulatory requirements for digital asset trading platforms.
The SFC requires the licensing by June of all cryptocurrency exchanges operating in Hong Kong or soliciting services from Hong Kong investors.

In addition, the SFC said it would seek feedback on whether licensed platform operators should be allowed to provide services to retail investors and what measures should be implemented to ensure suitability and token inclusion when establishing business relationships with customers.

Currently, retail trading of cryptocurrencies is banned in Hong Kong. The announcement that the special administrative region of China was dipping its toes back into crypto immediately set off bullish reactions from everyday users and executives alike. Brian Armstrong, CEO of the cryptocurrency exchange Coinbase, wrote:

“America risks losing its status as a financial hub long term, with no clear regs on crypto, and a hostile environment from regulators. Congress should act soon to pass clear legislation. Crypto is open to everyone in the world and others are leading. The EU, the UK, and now HK.”

To be fair, he wrote that in response to a tweet suggesting retail trading would be allowed from June 1, which is not the case, but the sentiment remains. At the same time, Cameron Winklevoss, co-founder of the cryptocurrency exchange Gemini, said in a tweet:

My working thesis atm is that the next bull run is going to start in the East. It will be a humbling reminder that crypto is a global asset class and that the West, really the US, always only ever had two options: embrace it or be left behind. It cant be stopped. That we know.”

Shortly afterward, cryptocurrency exchanges Gate.io and Huobi Global stated that they would apply for crypto exchange licenses in Hong Kong. Both exchanges said they would comply with the relevant regulations in order to be able to offer services to Hong Kong clients. Crypto users and stakeholders alike have until March 31 to partake in the SFC consultation.

FTX Japan customers withdraw $49M

On Feb. 21, FTX Japan, the Japanese subsidiary of troubled cryptocurrency exchange FTX, resumed withdrawals for its customers after assets were frozen for approximately three months as part of international bankruptcy proceedings.

Customer funds, which were managed separately in compliance with Japanese laws and regulations, were revealed as being worth 5.6 billion Japanese yen ($41.58 million) in digital currencies and 1 billion yen ($7.43 million) in fiat currencies as of Feb. 20.

The company also reported its own net assets to be around 10 billion yen ($74.3 million) in September 2022, which increased to 17.8 billion yen ($132.2 million) in the last update on Nov. 21.

Since reopening withdrawals, over 6.6 billion yen ($49 million) in crypto and fiat has left the exchange. To withdraw, users were required to verify their account balance and transfer their assets to Liquid Japan, another cryptocurrency exchange previously acquired by FTX.

As tabulated by FTX Japan, 3,453 individuals and 94 corporate accounts were eligible to withdraw their balances. There were 1,947 fiat withdrawals and 5,697 total crypto withdrawals. A total of 7,026 accounts were transferred from FTX Japan to Liquid Japan. They were the lucky ones, as due to bankruptcy proceedings the vast majority of FTX customers, including users of FTX US, are still unable to withdraw their assets.

The withdrawal process varies in complexity based on customers' circumstances.
The withdrawal process varies in complexity based on customers circumstances. Source: Liquid Japan

NBA China wants to mint more NFTs

On Feb. 21, the National Basketball Associations Chinese subsidiary announced a partnership with Alibaba-owned Ant Financial. Among many items, the two entities will carry out comprehensive cooperation regarding NBA video content, program broadcasting, joint membership and the creation of a miniseries.

In addition, both NBA China and Ant Financial wish to further pursue the joint development of nonfungible tokens and to launch multimedia NFT drops to fans.” Since last year, NBA China has minted a series of Chinese New Year basketball-themed NFTs using the latters Ant Chain.

A NBA China NFT
A Mengniu Dairy and NBA China NFT (Sohu)

Tencent Clouds great leap forward to Web3

Tencent Cloud, the cloud business brand of Chinese internet giant Tencent, announced on Feb. 22 that it would support the development of the Web3 ecosystem and provide technical support to developers to promote its digitalization.

Firstly, Tencent Cloud unveiled a new product, dubbed “Metaverse-in-a-Box,” that the internet giant says will act as a one-stop solution that integrates infrastructure, products, software development kits and low-code solutions to be used primarily in games and media entertainment.

Tencent Cloud VP Poshu Yeung made the announcement in Singapore.
Tencent Cloud vice president Poshu Yeung during the announcement in Singapore. Source: Tencent

In addition, the firm signed a memorandum of cooperation with Ankr, Avalanche, Scroll and Sui to further those goals. For Ankr, this means the joint deployment of a series of blockchain API services for remote procedure call nodes on Tencent Cloud. As for Avalanche, it will join forces with Tencent Cloud to provide developers with efficient and fast node settings. Finally, Tencent Cloud will assist developers with building practical projects on Scroll and create cloud game development tools with Sui. Tommy Li, vice president of Tencent Cloud, said:

Tencent Cloud Metaverse-in-a-Box meets the needs of customers and developers for different scenarios, helping them obtain better real-time interactive experience, larger-scale communication and more secure access services, and quickly build online and video virtualized and virtualized metaverse scene applications.”

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DeFi token rises 550% after Huawei shill 

In a 30-second video posted by Huawei on Feb. 21, the Chinese telecom conglomerate showcased DeFi protocol Defactor. During the video, co-founder Alejandro Gutierrez said the project is about creating a bridge between traditional finance with DeFi, exploring the tokenization of real-world assets and building partnerships with start-ups and large corporations like.

In the eyes of crypto investors the statements Gutierrez made were anything but ordinary. Immediately after the video was published, Defactor (FACTR) tokens recordeda gain of over 550% in less than three days, trading at $0.14 apiece at the time of publication. Defactor is currently part of Huawei International Scale-Up Program in Ireland.

China’s 180M digital yuan airdrop, Devastation in Turkey, Laos’ CBDC: Asia Express

Our weekly roundup of news from East Asia curates the industry’s most important developments. China airdrops 180 million digital yuan to celebrate Lunar New Year  According to state-owned media Global Times, Chinese cities airdropped a total of 180 million digital yuan (e-CNY) worth $26.6 million to boost consumption during the Lunar New Year celebrations between […]

Our weekly roundup of news from East Asia curates the industrys most important developments.

China airdrops 180 million digital yuan to celebrate Lunar New Year 

According to state-owned media Global Times, Chinese cities airdropped a total of 180 million digital yuan (e-CNY) worth $26.6 million to boost consumption during the Lunar New Year celebrations between Jan. 22 and Feb. 5. Nearly 200 digital yuan activities were launched during the festival, and commercial institutions also participated in these promotions, covering various sectors such as mobile communications, supermarkets, transportation and tourism.

Data from Meituan, a popular Chinese food delivery platform, showed that its 20 million digital yuan vouchers given out in partnership with the city of Hangzhou government were claimed in less than 10 seconds. China has prioritized the development of its central bank digital currency (CBDC) as part of its digital economy transformation, with numerous local party officials receiving key performance indicator targets regarding their efforts to promote the currency.

Chinas state-owned television also hosted a metaverse event for its Lunar New Year program this year. Source: FuXi. 

Asia-Pacific crypto exchanges donate to Turkey

In an act of international solidarity, cryptocurrency exchanges operating from several countries in the Asia-Pacific region were quick to react to a series of devastating earthquakes that struck Turkey and Syria on Feb. 6, with death tolls exceeding 12,000 at the time of publication. Singaporean exchange OKX said it would donate 1 million lira to the relief effort, while Binance stated it would airdrop $100 in BNB to Turkish users with addresses listed in the affected region. Cryptocurrency exchange MEXC Global also announced it would donate 1 million lira to help with earthquake relief. Meanwhile, Justin Sun, an adviser at crypto exchange Huobi Global, pledged 2 million lira for relief efforts. Donations are currently not available to Syrian residents due to sanctions. 

While the [proof of address] method has its limitations and inaccuracies, it is the best method we have available for us to locate potentially impacted users. We estimate the total donations will be around $5 million USD (or 94,000,000 TRY), Binance stated.

Laos made-in-Japan CBDC 

On Feb. 7, the Bank of the Lao Peoples Democratic Republic (PDR) and Japanese fintech company Soramitsu joined forces to launch a proof-of-concept for a CBDC in the country. The project, dubbed DLak (Digital Lao Kip), follows a feasibility study of a blockchain-based payment infrastructure in Lao PDR, which took one year to complete and was initiated by the Japan International Cooperation Agency. 

The proof-of-concept will first be issued to a commercial bank, sent to individuals for payments at stores and collected by the Bank of the Lao PDR from the commercial bank. 

According to the Lao central bank, the objectives of the study are financial inclusion, cross-border remittances and the advancement of payment systems. 

Soramitsu has been selected by the Ministry of Economy, Trade and Industry of the Japanese government to conduct feasibility studies on CBDC in several countries, including Lao PDR, Fiji, Vietnam and the Philippines. The company has developed a digital currency for the National Bank of Cambodia and is actively involved in proof-of-concept tests for major Japanese enterprises and open-source projects.

The DLak proof-of-concept inauguration event. Source: Soramitsu

Binance halts dollar deposits and withdrawals

Binance has announced it will temporarily suspend all U.S. dollar bank transfers starting Feb. 8 for its non-U.S. international customers. The firm says that only around 0.01% of its monthly active users utilize the transfer option, but acknowledges it still represents a bad user experience.” 

According to Binance, the suspension will only affect U.S. dollar bank transfers for users outside of the Binance.US exchange and will not impact other methods of buying and selling cryptocurrencies. Although the firm did not state a particular reason, Cointelegraph reported on Jan. 22 that Binances SWIFT banking partner, Signature Bank, banned USD SWIFT transfers below $100,000 to limit exposure to the crypto sector. The exchange is reportedly looking for a new banking partner and will have an announcement for affected users in the next couple weeks.

Damus censored in China 

On Feb. 2, just one day after the launch of the decentralized social network Damus, developers claimed that their app was removed from Chinese app stores because it includes content that is illegal in China. A message to developers read:

According to the CAC, your app violates the Provisions on the Security Assessment of Internet-based Information Services with Attribute of Public Opinions or Capable of Social Mobilization. If you need additional information regarding this removal or the laws and requirements in China, we encourage you to reach out directly to the Cyberspace Administration of China.

Previously, Damus reached the top 10 in terms of free social media apps on the App Store in the U.S.

The social network, which operates on the decentralized network Nostr, emphasizes user control and privacy, with no centralized servers. Although banned in China, the app is still available anywhere else in the world. On Feb. 7, developers teased a new feature that will allow users to earn satoshis, the smallest denomination of Bitcoin (BTC), based on their post engagement.

Huobi lists FTX debtors coin

On Feb. 5, Huobi announced the exclusive listing of FUD (FTX Users Debt) token issued by DebtDAO. FUD is a Tron-based bond token issued on behalf of creditors of bankrupt cryptocurrency exchange FTX with an initial issuance and liquidity of 20 million FUD with a fair-price range of 0 to 5 Tether (USDT). As a contract with DebtDAO, FUD holders are entitled to secondary offerings and airdrops after FTX restores its database or confirms the actual debt of the creditor.

After the airdrop, DebtDAO says it will conduct a 1:1 debt buyback for FUD holders. However, after a wild price surge to $113, Huobi stated the very next day that it would burn 18 million FUD tokens to maintain parity. Justin Sun, an adviser at Huobi, claimed that early users received 10x return after the burn event. 

Binance returns to South Korea with acquisition

On Feb. 3, Bloomberg reported that Binance acquired a majority stake in the South Korean cryptocurrency exchange Gopax. While terms of the deal werent disclosed, users reported a 14.91 million Binance USD (BUSD) withdrawal from Binances $1 billion Industry Recovery Initiative around the same time of the announcement.

Binance previously exited the South Korean market in 2021, citing low usage and volume, but claims it is returning to the market to help customers of the ailing Gopax exchange. In November, Gopax halted withdrawals and interest payments for its decentralized finance yield product GoFi after its broker, Genesis Global, suspended withdrawals due to unprecedented market conditions. As part of the acquisition terms, Gopax CEO Lee Jun-haeng reportedly resigned and sold his entire 41.22% stake in the exchange. 

Gopax CEO Lee Jun-haeng. Source: Daum

Huawei NFTs, Toyota’s hackathon, North Korea vs. Blockchain: Asia Express 

Our weekly roundup of news from East Asia curates the industry’s most important developments. Huawei moves to trademark its NFTs According to a Jan. 28 report by Sina News, Chinese telecom giant Huawei has recently filed for eight trademarks related to its Huawei “YunYunBao” nonfungible tokens (NFT) series. The trademarks include digital collectibles in the […]

Our weekly roundup of news from East Asia curates the industrys most important developments.

Huawei moves to trademark its NFTs

According to a Jan. 28 report by Sina News, Chinese telecom giant Huawei has recently filed for eight trademarks related to its Huawei “YunYunBao” nonfungible tokens (NFT) series. The trademarks include digital collectibles in the scientific instruments, furniture, education, jewelry, advertising and telecom sectors. Last April, Huawei unveiled its YunYunBao NFTs, featuring characters inspired by its namesake cloud service. Huawei NFTs are minted on its proprietary Huawei Petal Chain, which the telecom giant says has over 1,000 nodes and can handle over 50,000 transactions per second. 

A Huawei cloud NFT. Source: Huawei

Toyota sponsors blockchain hackathon

In a Feb. 1 Medium post, Sota Watanabe, the founder of Japanese blockchain Astar Network, announced that Astar had received a sponsorship from Japanese automobile manufacturer Toyota for its latest Web3 hackathon. Astar is currently a parachain built on the Polkadot blockchain. 

According to Watanabe, over $100,000 in prizes will be distributed to projects that develop “intra-company DAO [Decentralized Autonomous Organization] support tools for this hackathon which Toyota employees may actually use in the future.” The hackathon will run from Feb. 14 to March 25.

The Toyota hackathon prize structure. Source: Hakuhodo

“Needless to say, Toyota is the largest company in Japan and one of the world’s leading international companies, Watanabe wrote. We are very excited to be hosting the Web3 Hackathon on Astar with Toyota. During the event, we aim to develop the first PoC DAO tool for Toyota’s employees. If a good tool is produced, Toyota employees will interact daily with products on Astar Network.”

North Korea devastates crypto

On Feb. 2, blockchain forensic analytics firm Chainalysis revealed that North Korean hackers stole an estimated $1.65 billion out of the $3.8 billion funds siphoned from decentralized finance (DeFi) protocols in 2022. For context, North Korean-related entities only stole $299.5 million in 2020 and $428.8 million in 2021. The firm also warned that despite the United States Treasury Department imposing sanctions on cryptocurrency mixer Tornado Cash on Aug. 8, North Korean hackers have increasingly turned to other digital asset mixers, such as Sinbad, to launder stolen funds. Chainalysis said:

North Korea-linked hackers tend to send much of what they steal to other DeFi protocols, not because these protocols are effective for money laundering they’re actually quite bad for money laundering given their increased transparency compared to centralized services but rather because DeFi hacks often result in cybercriminals acquiring large quantities of illiquid tokens that aren’t listed at centralized exchanges. The hackers therefore must turn to other DeFi protocols, usually DEXes, to swap for more liquid assets.”

On Jan. 29, decentralized finance analyst Zachxbt claimed he had traced another 17,278 Ether (ETH) worth around $27.18 million  laundered by North Korean hackers in the aftermath of the $100 million Harmony Bridge hack last June. According to Zachxbt, the funds were then moved to 14 wallet addresses spread across four exchanges. On Jan. 24, the U.S. Federal Bureau of Investigation confirmed that North Korea’s Lazarus Group was the mastermind behind the attack. 

North Korean hacking activities have seen a sharp rise as part of the countrys desperate push to earn foreign currency reserves amid sanctions. Source: Chainalysis

No Binance metaverse for now 

In an ask-me-anything session on Jan. 14, Changpeng Zhao, CEO of cryptocurrency exchange Binance, said that the firm “is more open to just investing in other virtual reality or metaverse games,” as the firm is not a game-builder and doesnt have a game building team. 

“Nobody really knows what metaverse means. Everybody has a different concept of it,” the crypto executive said, according to a transcript published on Jan. 27.

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Instead, Zhao says that Binance will focus its “next big product” on releasing multiple proofs-of-reserves and proofs-of-solvencies to increase its transparency. The exchange has set a goal of 1 billion users passing Know Your Customer verification for the new year. 

Huobi denies data sharing allegations 

Digital asset entrepreneur Justin Sun has responded to allegations that his exchange Huobi provided client information to Chinese tax authorities. The TRON founder tweeted that Huobi “doesn’t share any client information to tax authorities unless it follows international judicial assistance procedure.”

Previously, Sun praised the introduction of a new 20% Chinese cryptocurrency income tax as “a clear indication that the Chinese government views cryptocurrencies as a legitimate form of wealth and wants to ensure its proper taxation.” 

Although based in the Seychelles, Huobi has a sizable number of staff working in mainland China, who reportedly revolted against the firm’s stringent new labor policies early this month. 

Huobi founder’s new ventures

After selling his entire stake in Huobi to Suns About Capital last October, Chinese businessman Lin Li has dedicated his time to managing Hong Kong blockchain investment holdings firm New Huo Technology. On Jan. 30, New Huo launched a staking technical support service, dubbed “Sinohope Staking,” that will first serve the Cosmos community before expanding into Ethereum, EOS and ChainLink. 

According to developers, Sinohope Staking will provide “multi-node deployment, real-time monitoring of node operation process, 7*24h online support, 3-layer wallet structure and multiple signature technologies” for users interested in staking their assets on public blockchains. New Huo says it will help clients set up their stake nodes and monitor their operations “without handling or holding any clients’ assets,” and claims clients will retain “100%” of their staked cryptocurrencies during the process. 

Bitzlato allegedly defiant despite sanctions

The co-founder of Hong Kong-based cryptocurrency exchange Bitzlato says the platform will reopen after being shut down by United States authorities last month.

In a Jan. 31 YouTube interview, Russian national Anton Shurenko said that the exchange would open later at an unspecified time and claimed up to 50% of funds held in seized hot wallets would be available for withdrawal at that time. In addition, the supposed founder claimed he had no idea why his company was singled out. 

On Jan. 18, Bitzlato was shut down after an investigation by law enforcement officials, including the U.S. Department of Justice, revealed that the exchange imposed lax Know Your Customer rules and allegedly laundered over $700 million worth of illicit funds via crypto-fiat transactions. Shurenko’s fellow co-founder, Anatoly Legkodymov, was arrested in Miami around the same day. After revelations that Binance was one of the top counterparties to Bitzlato, the exchange froze a number of accounts related to the entity.  

According to recent reports, Spanish police have detained three executives from the firm, namely the CEO, a sales executive and the marketing director.

Despite its notoriety, many users in the crypto community say they’ve never heard of Bitzlato before the incident. Source: Twitter

Bithumb in turmoil, Binance’s 47K law requests, Axie players down 85%: Asia Express

Our weekly roundup of news from East Asia curates the industry’s most important developments. Bithumb in turmoil  On Jan. 25, Yonhap Infomax reported that South Korean authorities had requested an arrest warrant for Kang Jong-Hyun, chairman and owner of cryptocurrency exchange Bithumb, over embezzlement allegations. That same day, the Financial Investigation Second Division of the […]

Our weekly roundup of news from East Asia curates the industrys most important developments.

Bithumb in turmoil 

On Jan. 25, Yonhap Infomax reported that South Korean authorities had requested an arrest warrant for Kang Jong-Hyun, chairman and owner of cryptocurrency exchange Bithumb, over embezzlement allegations. That same day, the Financial Investigation Second Division of the Seoul Southern District Prosecutors Office accused Jong-Hyun and two Bithumb executives of embezzlement, conducting fraudulent transactions and breach of trust. 

A leaked photo of Bithumb chairman Kang Jong-Hyun. Source: Korea Post English
A leaked photo of Bithumb chairman Kang Jong-Hyun. Source: Korea Post English

Authorities said that Kang played a key role in manipulating the stock prices of Bithumb affiliates Inbiogen and Bucket Studio through the issuance of convertible bonds.

Bithumb is one of the largest cryptocurrency exchanges in South Korea. Its previous chairman, Lee Jung-Hoon, was found not guilty last month of a $70 million fraud charge related to his activities at Bithumb. Park Mo, Bithumbs former largest shareholder, died on Dec. 30 while under investigation for allegedly embezzling funds from Bithumb and related companies. The firm is also currently probed by the National Tax Service over tax compliance incidents. 

Binances 2022 annual report

In its annual report released on Jan. 19, cryptocurrency exchange Binance revealed that the firm received more than 47,000 law enforcement inquiries throughout the year. The exchange said such requests were processed at a record time and that it was the first among blockchain firms to join the National Cyber-Forensics and Training Alliance, a nonprofit cybercrime fighting unit based in Pittsburg. 

In response to the inquiries, Binance said it increased the headcount of its security team by more than 500% and hosted 70 law enforcement workshops around the globe in 2022 to help fight blockchain-related financial crime.

In the event of security incidents, Binance also stated it would tap into funds from its $1 billion SAFU (Secure Asset Fund for Users) user insurance program to compensate for losses. The exchange also tightened requirements such as NFT listings. Starting Feb. 2, Binance will delist all NFTs listed before Oct. 2 that had an average daily trading volume of less than $1,000 between Nov. 1 and Jan. 31.

In January 2022, we announced that SAFU was worth
$1B. Due to market conditions in 2022, that value
dropped to $735m. As of November 2022, we topped the
SAFU balance back to $1B. We made a promise to our
users, along with the larger crypto ecosystem, that SAFU
would always maintain a sizable level.

The exchange received 14 licenses and regulatory registrations in 2022. Other highlights include its $1 billion pledge for an industry recovery fund amid FTXs collapse and investing $500 million into Web3 and blockchain firms through Binance Labs. Although it does not have a fixed corporate office, the exchanges governing jurisdiction is the Hong Kong International Arbitration Center for legal disputes. Its servers are also reportedly located in Japan. 

Jurisdictions where Binance received regulatory clearance in 2022. Source: Binance.
Jurisdictions where Binance received regulatory clearance in 2022. Source: Binance

Axie Infinitys declining numbers 

The latest data from the website Active Player reveals that the number of players of the popular monster battle P2E game Axie Infinity, developed by Vietnamese gaming studio Sky Mavis, fell to 432,001 in the past month. This represents the lowest level seen since November and means the game has lost approximately 85% of its player base over the past year. 

Axie Infinity's popularity has dwindled in recent months. Source: ActivePlayer.io
Axie Infinity’s popularity has dwindled in recent months. Source: Active Player

Initially a groundbreaking GameFi success, Axie Infinity has fallen on hard times as the crypto winter took a toll on its play-to-earn dynamic, which was exacerbated by the infamous Sky Mavis Ronin bridge hack last March. New features, such as the much-anticipated Land Gameplay release on Dec. 28, did not appear to reverse the declining trend. At the time of publication, about $3.85 million worth of Axie NFTs changed hands in the past 30 days, compared with $639.5 million in November 2021. 

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City of Busans crypto exchange

As first reported by local news outlet News 1 Korea, the city of Busan is working to establish a decentralized digital assets exchange scheduled for operations this year. According to municipal officials, the exchange will include buying and selling of tokenized intellectual property rights for films and games, as well as trade in gold, precious metals, agricultural and livestock products, ships and real estate. The Busan Digital Asset Exchange Establishment Promotion Committee plans to coordinate with domestic financial companies and conduct system tests in the near future. 

Bybits Genesis exposure 

In a Jan. 20 Twitter thread posted by Ben Zhou, CEO of Singaporean cryptocurrency exchange ByBit, the blockchain executive clarified the exchange positions after questions arose regarding an alleged $151 million exposure to bankrupt crypto lender Genesis Global. As told by Zhou, the exposure amount is limited to Mirana, the investment arm of ByBit, and that $120 million of collateralized positions out of the $151 million exposure amount had already liquidated.

Zhou claims that Mirana only manages some ByBit company assets and that clients funds are separated. In addition, Zhou said that ByBit Earn products dont use Mirana. Genesis Global froze withdrawals last November, citing unprecedented market conditions, and filed for bankruptcy on Jan. 20, reportedly owing $3.5 billion to over 50 creditors. 

Bitzlatos trail of dirty money

According to a Reuters report on Jan. 24, cryptocurrency exchange Binance allegedly helped move $346 million in Bitcoin for now-defunct Hong Kong cryptocurrency exchange Bitzlato. Binance was also reportedly one of the largest counterparties to the exchange. On Jan. 23, Europol stated that $19.5 million were seized in enforcement actions against Bitzlato.

Last week, the United States Department of Justice announced a major international cryptocurrency enforcement action against Bitzlato for the latters alleged role in laundering $700 million in funds tied to dark web marketplace Hydra and Russian illicit finance. Its founder, Anatoly Legkodymov, a Russian national and resident of China, was arrested in Miami on Jan. 18 on charges of operating an unlicensed money transmitter. The exchange has since been shut down. 

Samsung’s Bitcoin ETF, $700M bust, Coinbase exits Japan: Asia Express

Our weekly roundup of news from East Asia curates the industrys most important developments.

Samsungs new Bitcoin ETF

On Jan. 13, Samsung Asset Management, a wholly-owned subsidiary of the namesake South Korean conglomerate, successfully listed the Samsung Bitcoin Futures Active ETF on the Hong Kong Stock Exchange. According to local news outlet Edaily, the ETF debuted under the ticker 3135:HK and seeks to replicate the performance of spot Bitcoin by investing in Bitcoin futures listed on the Chicago Mercantile Exchange (CME).

The ETF will also simplify the procedures for investors seeking exposure to regulated Bitcoin products in the Asia-Pacific time zone. Park Seong-jin, head of Samsung Asset Managements Hong Kong office, commented: 

Hong Kong is the only market in Asia where Bitcoin futures ETFs are listed and traded in the institutional market. It will be a new option for investors who are interested in Bitcoin as a competitive product that reflects their experience in risk management and risk management.

Also read: How to prevent AI from annihilating humanity using blockchain

North Korean hackers launder 41K ETH

As revealed by blockchain sleuth ZachXBT on Jan. 16, hackers linked to the North Korea-backed Lazarus Group moved close to 41,000 Ether ($63.5 million) from the Harmony bridge hack to Railgun, a platform that uses zero-knowledge technology to obfuscate blockchain transactions.

Funds were allegedly deposited to three different cryptocurrency exchanges after leaving Railgun. The same day, Binance CEO Changpeng Zhao said the exchange, along with Huobi Global, had frozen a portion of the stolen funds and recovered 124 Bitcoin ($2.59 million).

Nomad Bridge TVL before and after the exploit.
Nomad Bridge TVL before and after the exploit. Source: DefiLlama

Last June, the Nomad cross-chain bridge was drained of over $100 million after suspected North Korean hackers targeted the login credentials of Nomad employees in the Asia-Pacific region. After gaining control of the protocol, the hackers deployed automated laundering programs that moved the stolen assets late at night.

Lazarus Group has been linked to a series of high-profile decentralized finance incidents last year, including the $600 million Axie Infinity Ronin hack, as the sanctions-ridden country turned to hacking and ransomware to make up for its shortfall of foreign currency reserves. 

Bitzlato busted for laundering $700M+

According to a Jan. 18 statement from the U.S. Department of Justice, Hong Kong cryptocurrency exchange Bitzlato was shut down by U.S. and E.U. authorities over allegations that since May 2018 the exchange has processed $700 million in funds linked to illicit activities, including millions in ransomware proceeds. Prosecutors alleged that illicit funds made up a significant part of its trading volume, with Bitzlato only processing around $4.58 billion worth of cryptocurrency transactions since its inception. 

Bitzlato website taken down after authorities' raid.
Bitzlatos website has been taken down following enforcement action. Source: Bitzlato

Anatoly Legkodymov, a Russian national and majority shareholder of Bitzlato, was arrested in Miami on Jan. 17 on charges of conducting an unlicensed money-transmitting business. He faces a maximum penalty of five years in prison if convicted. 

Legkodymov was allegedly an OG in the early Bitcoin community. Source: Telegram.
Legkodymov was apparently an OG in the early Bitcoin community. Source: Telegram

Legkodymov, who lives in Shenzhen, China, allegedly implemented minimal Know Your Customer requirements on Bitzlato users, specifying that neither selfies nor passports [are] required, and allowing users to signup using information belonging to straw man registrants. Authorities said that Bitzlato became a safe haven for illicit transactions and served as the largest counterparty to dark web marketplace Hydra Market. 

Hydra Market users exchanged more than $700 million in cryptocurrency with Bitzlato, either directly or through intermediaries, until Hydra Market was shuttered by U.S. and German law enforcement in April 2022. Bitzlato also received more than $15 million in ransomware proceeds.

Coinbase leaves Japan

In a Jan. 18 statement, cryptocurrency exchange Coinbase said it would cease operations in Japan, citing difficult marketing conditions. According to the exchange, users Japanese yen and crypto assets were segregated, and all customers will have until Feb. 16 to withdraw their crypto holdings. Alternatively, users can also liquidate their digital assets and withdraw yen to their fiat bank. 

Any remaining crypto holdings held on Coinbase on or after Feb. 17 will be converted to JPY. In the month following Feb. 17, Coinbase will send any remaining JPY to a Guaranty Account at the Legal Affairs Bureau in accordance with legal requirements. If customers do not take any action before Feb. 16, they will have to coordinate with the Legal Affairs Bureau to retrieve their JPY balance.

Coinbase first began its expansion into the Japanese market in 2018. Another crypto exchange, Kraken, ceased operations in Japan on Dec. 28, citing weak market conditions. Earlier this month, Coinbase said it would lay off another 20% of its staff amid the ongoing crypto winter. 

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Hodlnauts angry creditors

On Jan. 13, Bloomberg reported that creditors of Singapore cryptocurrency borrowing and lending platform Hodlnaut refused a corporate restructuring plan and opted for the liquidation of remaining assets. Last August, Hodlnaut suspended all withdrawal, deposit and token swap services. The firm is currently facing a police probe after allegedly misrepresenting its exposure to the Terra USD stablecoin (USTC) and losing investors $190 million in the subsequent Terra ecosystem collapse. 

Japan clarifies NFT tax rules

As first reported by local news outlet Coin Post, Japans National Tax Agency released a document on Jan. 13 summarizing the general tax treatment of nonfungible tokens, or NFTs, in the country. Specifically, NFTs are taxed if an individual creates a digital collectible and sells it to a third party and when individuals resell it to another person.

In both cases, sales represent the transfer of viewing rights related to digital art and are classified as business income during primary sales and transfer income during secondary sales, where capital gains rules apply. Moreover, in the event that NFTs were hacked or stolen, individuals can claim either a miscellaneous loss deduction or can include the lost NFT as part of expenses if it was a business asset. 

30,000 e-CNY airdrop prizes claimed in 15 secs 

According to a Jan. 18 report by local news outlet Hangzhou Wang, the City of Hangzhou, in partnership with Chinese food delivery platforms Meituan Dianping and Eleme, airdropped a series of digital yuan central bank digital currency (e-CNY CBDC) vouchers for residents. Once claimed, users could then cash them in at the namesake platforms to purchase deliverables for the upcoming Chinese New Year on Jan. 22.

The only catch? All of the 30,000 e-CNY vouchers were claimed within 15 seconds of launch. Since late last year, the e-CNY has expanded into utilities such as paying for taxes, and local transportation, as well as being included in The Peoples Bank of Chinas M0 calculations

Huobi employees revolt, GameFi lives, Antminer on steroids: Asia Express

Our weekly roundup of news from East Asia curates the industrys most important developments.

Huobis disgruntled employees

According to local media reports, cryptocurrency exchange Huobi Global has terminated all year-end employee bonuses and benefits, as well as axed its entire core development staff located in mainland China. The laid-off staff will be instead switched to advisory contracts that do not receive protection under Chinese labor laws. Employees also claim that their leftover paid vacation days and sick leave days for 2022 were set to zero without prior notification. 

Moreover, executives allegedly imposed a messaging ban on all major Huobi employee chat groups. In response, employees reported formed a 400-member strong rights maintenance group and have since sought the advice of counsel in the labor dispute. One employee reportedly wrote: 

I love my company and my job; at the same time, I support all decisions that benefit the company, and I know that with economies recessionary everywhere in the globe, Huobi management staff must tighten their belts, and I can understand the lack of year-end bonuses. That said, I cannot accept the unreasonable swap of employment contracts. I will fight this to the end.

However, it appears that employees still received the short end of the stick. On Jan. 6, Cointelegraph reported that Huobi laid off 20% of its workforce while denying insolvency rumors. But at the time of publication, sources say that the exchange is operating at a loss of $10 million per month.

Founded by Chinese entrepreneurs Leon Li and Du Jun in 2013, Huobi relocated its registrar to Seychelles following Chinas Bitcoin ban. Last October, its founders reportedly sold 100% of their stake to Chinese blockchain personality Justin Sun, who also founded the Tron network and is the CEO of BitTorrent. Sun claims merely to be an adviser to Huobi, currently the 17th-largest cryptocurrency exchange worldwide by 24-hour trading volume. 

MOBA games 100,000 downloads 

Approximately one month after launch, SuperpowerSquad (SPS) has been downloaded from Google and Apples app stores more than 100,000 times, a spokesperson for the multiplayer online battle arena (MOBA) blockchain game told Cointelegraph.

The spokesperson said that the BNB Chain-based game, which had been in development for over two years, seeks to become a complete GameFi blockchain ecosystem, and the next steps include cross-bridge integrations and expanding the native token SQUADs utility to its second and third blockchain games in development.

SPS Gameplay. Source: Superpower Squad.
Superpower Squad is a multiplayer battle arena blockchain game. Source: Superpower Squad

The firm has already completed its mainnet and token launch and developed a built-in in-game wallet address that allows users to collect NFT hero rewards and digitized items. SPS currently has around 3,000 daily active users. The company is registered in the British Virgin Islands, with its core development staff based in Hong Kong and Singapore. 

Bitmain unveils 122 TH/s Bitcoin miner

On Jan. 11, Beijing-based application-specific integrated circuit manufacturer Bitmain launched the new Antminer S19j Pro+. The company claims that the new Bitcoin miner is 10% more potent than the S19j Pro, with a hash rate of 122 terrahash per second. The firm states its now a truly global Antminer:

In addition to its excellent performance is its adaptability to most global data centers, with a new input voltage range of 220-277V. Given that the industrial electrical voltage in the United States is 277V, Kazakhstan 220-230V, and Russia 220V, the voltages in these three countries are within the coverage of 220-277V.

Although pricing has not been disclosed, the S19j Pro predecessor currently costs $1,842 without shipping via computer hardware retailer Newegg.

A Bitmain ASIC miner
A Bitmain ASIC miner. Source: Newegg

Digital yuan included in M0 figures

According to a Jan. 10 local news report, the Peoples Bank of China in December began including its digital yuan central bank digital currency (e-CNY) in official M0 money supply figures. Official data revealed that over 13.61 billion Chinese yuan ($2 billion) worth of e-CNY has been issued since the pilot program began in January last year. Over the past year, state developers have rolled out features such as offline and no-electricity-required payments. However, some officials say that adoption remains below expectations

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Researchers quantum digital signature

As reported by the Chinese technology website Lianmenhu, researchers Chen Zengbing and Yin Hualei at Nanjing University have successfully signed a digital file using a quantum digital signature framework. Using a combination of one-time hash and one-time pad encryption principles, researchers reportedly increased the signing rate by a factor of hundreds of millions. Unlike classical signatures, such as signing a document with a pen or public key encryption, quantum signatures are verified via quantum mechanics and theoretically cannot be forged. The university said: 

The team demonstrated the worlds first full-featured quantum security network experimentally, realizing the protection of all elements of information security and providing a technically complete network and quantum safety base for the digital economies and digital currencies.

WangYis Lunar New Year metaverse

On Jan. 10, Shanghai Securities News reported that Chinese internet giant WangYi has partnered with state broadcaster China Central Television (CCTV) for a metaverse night special on the latters 2023 Chinese New Year program. 

For this operation, WangYi mobilized its LeiHuo, FuXi, Entertainment AI Lab, and WangYi Blockchain departments, utilizing digital twinning, blockchain, AI digital art, and AI sound technologies, to create the first Chinese New Year metaverse concert that can support tens of thousands of audiences, the outlet reported.

The WangYi metaverse platform reportedly features a 30 km digital water space where users can follow the official CCTV New Years program, participate in concerts and launch fireworks. WangYi also said it would spread its audience across multiple parallel universes (i.e. servers) to reduce lag and enhance multiscreen streaming. 

WangYi Metaverse
WangYi’s Chinese New Year metaverse. Source: WangYi

Thailand SEC probes Zipmex

On Jan. 11, Cointelegraph reported that Thai cryptocurrency exchange Zipmex is facing a probe by the countrys Securities and Exchange Commission alleging a breach of local rules.

On Dec. 2, Thai VC fund V Ventures announced that it had acquired the exchange for $100 million. On July 20, the company paused user withdrawals just moments after its CEO denied financial trouble rumors. The exchange has asked for a credit protection extension in Singapore pending the acquisition.

Your guide to crypto in Toronto: Crypto City

Toronto embraced digital assets sooner than most and is home to more crypto projects than anywhere else in Canada.

Contents

Overview
Crypto culture in Toronto
Where can I spend crypto in Toronto?
Crypto projects and companies in Toronto
Torontos crypto controversies
Toronto crypto education and community
Notable crypto figures from Toronto

Overview

The city lies at the center of the so-called Golden Horseshoe, a large urban area around the shore of Lake Erie that 9.76 million people about a quarter of all Canadians call home. Consistently rated among the worlds most livable cities, Toronto, much like Vancouver on the west coast, is notable for its ethno-cultural diversity brought on by waves of immigration. Its within a short flight of the capital Ottawa, as well as Montreal to the north and New York to the south. Toronto is seen as the countrys financial and cultural capital.

Toronto was where Ethereum founder Vitalik Buterin grew up
Toronto was where Ethereum founder Vitalik Buterin grew up. Source: Pexels

Playing home to notable battles between indigenous peoples in the late 1600s, French traders from the mid-1700s and the British later that century, Toronto has seen a lot. In 1834, around the time of a failed rebellion against the British, it was incorporated as Toronto, which was a First Nations name, and the city became a destination for slaves escaping the American South. In the late 1800s, the city became a railway hub. Today, it is served by Pearson International Airport.

As a global hub of business and culture, Toronto resembles a northern version of New York, to the extent that many movies set in New York are filmed in the city due to their similar appearance. Winter weather can be formidable, with freezing rain in 1999 requiring the army to be called in for road clearing. The city is well-known as the birthplace of Ethereum and today hosts a majority of Canadas blockchain companies.

Crypto culture in Toronto

Vitalik Buterin, an elongated Toronto young man who looked brainy in a very literal way, had attended Anthonys first meetup and later brought to him an idea for a blockchain platform he called Ethereum.

So writes author Ethan Lou in his memoir, Once A Bitcoin Miner, much of which takes place in Toronto. Anthony Di Iorio, an early Bitcoin investor, started a crypto meetup named after his software company Decentral in a redbrick house in Torontos historical fashion district this is where the young Buterin walked in with his idea for Ethereum, which is, of course, another story entirely.

With the founding of Ethereum, Toronto cemented its position in the crypto canon. By 2018, Canadian startup blog BetaKit wrote there was a divide in Canada between the areas that embraced the cultural aspects of crypto on one side, and the financial aspects on the other.

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Before NFTs: Surging interest in pre-CryptoPunk collectibles

While Toronto and Waterloo are understood to be lively crypto hubs, Vancouver is known for companies that privilege crypto-collectibles over currency, and blockchain art over tokens. 

This makes sense, considering Toronto is a city oriented primarily toward finance, while Waterloo, the birthplace of BlackBerry, is a tech hub an hours drive away. Thats where Buterin attended university briefly and was the home of the author of this article for nearly 20 years.

Toronto's famous Bitcoin sign at Decentral headquarters
Torontos famous Bitcoin sign at Decentral headquarters. Source: Decentral

In 2014, Decentral opened a physical location on the prominent Spadina Avenue, making it and its large Bitcoin sign something of an institution and a way in which Bitcoin touched the lives of average Torontonians. Featuring a Bitcoin ATM, the spot became almost a Bitcoin embassy in the city, hosting meetups and other events. 

As a financial hub, Toronto regularly plays host to blockchain conferences including the annual Blockchain Futurist Conference, the largest in the country. In 2022, the event coincided with ETH Toronto. The year also saw the Web3 & Blockchain World summit, AIBC Toronto and the Cardano Summit 2022. A quick browse of Meetup.com will reveal that there are dozens of cryptocurrency-, blockchain- and NFT-themed meetups in the city and surrounding area. 

The corporate nature of the city means there is more funding available than in most other comparable destinations, explains Charlie Aikenhead, senior vice president of marketing at WonderFi. And unlike south of the border in the United States, there is a general sense of regulatory certainty, which encourages a willingness to bet on the industry.

Canadian investors and citizens seem to have a more favorable view of the industry and have less worries about customer protections than other countries.

Where can I spend crypto in Toronto?

According to Coinmaps, there are a number of businesses in the city and surrounding areas that happily accept cryptocurrency as payment. In addition to crypto ATMs and various shopping outlets specializing from sportswear to TV antennas, one can have their teeth repaired at Downtown Dental Hygiene Clinic, with the same service available for their homes at B & B Cleaning Service. Down the street from both, Grossmans Tavern is happy to exchange beer for bits, while Toronto Brewing will sell you all you need to make drinks at home. Even cryotherapy is available at Vital Cryotherapy Toronto.

Coffee can be purchased at the nearby Snakes and Lattes board game cafe a few blocks away, while Urban Living Suites offers a good nights rest for crypto tourists roaming the streets without loonies or toonies what locals call $1 and $2 dollar coins, featuring a loon and two polar bears, respectively. Online services such as those offered by WebRocker Web Design are also available. 

While crypto acceptance is by no means the norm, it is notable to say that it appears very reasonable that one could go cashless and survive on cryptocurrency for the majority of their needs by seeking out crypto-friendly businesses in the region.

If one is determined, about anything can be purchases with crypto in the Toronto region
If one is determined, just about anything can be purchased with crypto in the Toronto region. Source: Coinflip

Crypto projects and companies in Toronto

Toronto has the largest concentration of blockchain startups in the country, to the extent that startupill.com published a list titled 82 Best Toronto Cryptocurrency Startups. Among the biggest ones include exchanges Coinsquare, CoinSmart, Tokens.com, Bitbuy, BitSwap, 3Commas, Coinberry and Coinlet among several others. Angel.co also lists 39 Top Blockchain / Cryptocurrency Startups in Toronto in 2022, many of which appear to be actively hiring.

On the mining side, Hut8 Mining is perhaps the most established player, being listed on the Toronto Stock Exchange with a market cap above $400 million. Bitfarms is also listed at a market cap of just under $200 million. DigiMax, Digihost and Cryptoster are also involved in mining. 

Andrew Kiguel, CEO of Tokens.com and former CEO of Hut8 Mining, explains that the mix of crypto companies and several large universities is the secret sauce to the citys industry success, which, he says, has a young and sophisticated crypto population.

There are several large universities, and many crypto companies are headquartered here. As a result, theres a large, active crypto community, he says. There are regular meetups and businesses that have launched in the city. It has a young and sophisticated crypto population. 

The crypto environment is generally cooperative and friendly. There is a large talent pool in Toronto seeking employment in crypto. Many crypto companies were launched in Toronto, and others, such as Galaxy Digital and Hive, were financed out of Toronto.

In addition to exchanges and mining, Toronto also hosts many financial services and advisory companies specializing in cryptocurrency. These include Signal, a market intelligence firm, Bitcoinblack, which provides crypto-backed credit cards, and payment transfer company Biquiti.

Jaxx Wallet, which allows users to easily manage cryptocurrency holdings via smartphone, is also based in Toronto.

Lower cooling costs are one positive note for the crypto mining industry un Canada
Lower cooling costs are one positive note for the crypto mining industry in Canada. Source: Pexels

Torontos crypto controversies

Earlier in 2022, authorities seized a Lambo and $2 million from local 23-year-old Crypto King Aiden Pleterski, whose company AP Private Equity Limited was accused of being a $35-million fraud according to court documents. Pleterski was allegedly renting out a lakeside mansion for $45,000 per month even as some locals say they lost money earmarked for their grandchildrens education. 

In early 2020, a Los Angeles billionaire named Josh Jones became a victim of a so-called SIM-swap attack, according to Ryk Edelstein, founder of 5-L Technologies, in Montreal. The attacker took $45 million in Bitcoin but was eventually tracked down to nearby Hamilton via a PlayStation username and IP address, where authorities found a teenager who later pleaded guilty. A friend, who witnessed the arrest, later recounted the story to local news: 

He told me, after the SIM swap, that he thought he got only $1 million. But when he looked at the total amount and saw it was $45 million, he panicked.

The city has seen a few crypto crimes from investment scams to sim-swaps
The city has seen a few crypto crimes from investment scams to SIM-swaps. Image: Pexels

Toronto also served as part of the stage for the infamous case of QuadrigaCX, whose late founder, Gerald Cotten, lived in the city while running the exchange. He reportedly died in India in 2018, seemingly taking the private keys to nearly $200 million with him to the grave which victims have later fought to exhume in a search for answers. In June 2020, the Ontario Securities Commission officially concluded that QuadrigaCX was a fraud and a Ponzi scheme.

Toronto crypto education and community

If you want to be a blockchain dev, at George Brown Universitys Casa Loma campus, you can participate in a one-year full-time Blockchain Development Program, which comes with a mandatory on-the-job training element. Tuition is only about $5,000 per year.

Toronto Metropolitan University offers a course called Blockchain for Business, which promises to help fill a knowledge gap for professionals seeking essential knowledge in the ways in which blockchain technology works and how it can be applied effectively to solve business problems. York University has a dedicated Blockchain Academy and offers a Certificate in Blockchain Development, which is more geared toward building than understanding, through its School of Continuing Studies. 

Torontos chapter of the International Institute of Business Analysis has provided its members with educational seminars on Blockchain Fundamentals, and Intellipaat provides a 27-hour IBM Blockchain Course. BlockGeeks also offers some free online courses.

There is also CryptoChicks, a nonprofit that has grown from Toronto to encompass chapters around the world helping thousands of women around the globe to learn and invest in blockchain, build new careers and businesses.

Notable crypto figures from Toronto

Vitalik Buterin (at least sometimes when he visits family, including father Dmitry Buterin), Ethereum co-founder Anthony Di Iorio; Author of Once A Bitcoin Miner and occasional Magazine contributor Ethan Lou; Tokens.com CEO Andrew Kiguel; Cannabanc founder Paresh Khatri; Bitbuy CEO Michael Arbus; Kylin Network co-founder Dylan Dewdney; Newton CEO Dustin Walper; CoinSmart CEO Justin Hartzman; Coinberry co-founder Andrei Poliakov.

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Andy Warhol would have loved (or possibly hated) NFTs

Asia Express: China’s NFT market, Moutai metaverse popular but buggy…

In a joint effort between the state-owned Chinese Technology Exchange, the state-owned Art Exhibitions China and the corporation Huban Digital Copyrights Ltd, Chinas first national NFT marketplace is scheduled to come online this week.

Its designed as a secondary market for trading digital collectibles, along with copyrights for digital assets. Perhaps unsurprisingly, its built on Chinas national Wenbao, or cultural protection blockchain, which helps verify the authenticity of artifacts and commercial goods. Currently, only the NFT platforms landing page is accessible. 

1400 blockchain firms in China

On Dec. 29, the state-owned China Academy for Information and Communications Technology, or CAICT, disclosed in its national white paper that over 1,400 blockchain firms are operating in the country despite strict regulations. Together, Chinese and U.S. blockchain firms account for 52% of such entities globally. In one example of distributed ledger applications in public service, CAICT researchers wrote: 

[In the] Zhejiang Provincial blockchain electronic invoice platform, [authorities] used blockchains multiple access point and decentralized process capabilities, along with technological highlights such as smart contracts, to improve the trust verification across various departments. This led to the digital circulation of electronic invoices; their issuance, receipt, inspection, reimbursement, and improved the information management level and service capabilities of electronic invoices in financial departments.

Similarly, local news outlet Shanghai Securities News reported that the digital yuan central bank digital currency, or e-CNY CBDC, surpassed 104.8 billion Chinese yuan ($15.21 billion) in usage in the province of Zhejiang since its inception in April. Provincial residents have opened 24.14 million e-CNY wallets, and authorities claimed to have distributed 3.5 billion yuan ($510 million) in tax refunds via the e-CNY to residents as an experiment. Despite the results, experts such as former Chinese central banker Xie Peng said that usage has been low for the CBDC

Kunmings blockchain KPIs 

On Dec. 30, the City of Kunming published its three-year plan for municipal digital economy development. The report set a 25% annual growth target for the citys digital economy to surpass 500 billion yuan ($72.58 billion) in two years. In addition, local-level communist party officials must meet collective key performance indicators of incubating at least 20 blockchain-specific applications and encouraging the development of at least 10 strongly competitive and technologically advanced blockchain firms by the end of 2024. Please implement [them] fully and completely, the document states. 

Moutais metaverse hits 1 million users

The Moutai metaverse experience. Source: 68h5.com

On Jan. 1, popular Chinese liquor distiller Moutai and internet technology firm WangYi launched their joint metaverse Xunfeng World on the Apple App Store. Developers designed the experience based on the Moutai distilleries in the Guizhou province. Players can interact with one another and distillers to learn the traditional Moutai-making experience. 

Just two days later, its registered users surpassed 1 million, with the app ranking No. 1 in the e-commerce category in China. However, the app only had a rating of 2.4/5 at the time of writing, with users complaining about in-game features, excruciating wait times for Know Your Customer verification, login difficulties and poor customer service. One user wrote: 

There is no customer hotline, there is no customer service, and I dont even know where to solve the problem. I looked forward to joining from the waitlist, but I could never pass KYC on the day of the apps release. Whats wrong? Im literally begging you to take my money so I can play this game, but it seems you dont want it?

Hong Kong crypto scams worsen

Hong Kong
Hong Kong cityscape. Source: Pexels

Currently, Hong Kong residents cannot trade cryptocurrencies unless they are classified as professional investors or have at least 8 million Hong Kong dollars ($1.02 million) in bankable assets. However, these regulations have done little to curtail the rise of crypto scams. 

A recent Hong Kong police report cited by Rthk.hk revealed that in the first 10 months of 2022, the special administrative region recorded 1,503 cases of investment scams involving total assets of $98.5 million, up 10% from the same period last year. 

About 70% of the scams were classified as involving crypto. One victim, Mr. Lee, reportedly lost 180,000 HKD ($23,000) after being contacted by a representative claiming access to exclusive insider information on the price of SUSHI tokens. Mr. Lee later called the police after his supposed trading account was removed without explanation. 

Square Enix all in on blockchain

In an annual letter published on Jan. 1, Yosuke Matsuda, president of Japanese gaming giant Square Enix, said that the company would shift its business focus to blockchain entertainment. The move follows Square Enixs announcement on May 3 that it would sell its blockbuster video game franchise Tomb Raider and use the proceeds to invest in new initiatives such as blockchain, though it still retains other popular franchises such as Final Fantasy. Matsuda wrote: 

I think it is fair to say that blockchain gained significant recognition as a field in 2022, as evidenced by Web 3.0 becoming a firmly established buzzword among businesspeople. However, the year also saw volatility in the cryptocurrency and NFT markets that tracked the dramatic shifts in the macroeconomy described above.

Matsuda also said that aside from monetization, blockchain and NFTs should be delivering new experiences and excitement to customers and that the company had multiple blockchain games based on original IPs under development. In its latest filing, Square Enix reported 163 billion Japanese yen ($1.23 billion) in revenue and 39.4 billion yen ($297 million) in profit for the first six months to Sept. 30.