Our weekly roundup of news from East Asia curates the industry’s most important developments.
Google sues alleged Chinese crypto scammers, can it win?
Alphabet’s Google subsidiary has filed lawsuits in federal court in New York against two Chinese nationals residing in mainland China for allegedly using Google Play to advertise and distribute fraudulent crypto apps.
The fraudulent apps on Google Play, including TionRT exchange, were downloaded over 100,000 times by individuals who deposited funds into the apps and were shown returns and could initially withdraw small amounts but were later unable to access their balances.
Google says it is the first tech company to take action against scammers and hopes to set a legal precedent. The suit claims the defendants allegedly made “multiple misrepresentations to Google in order to upload their fraudulent apps to Google Play, including but not limited to misrepresentations about their identity, location, and the type and nature of the application being uploaded.”
It’s bringing charges under the Racketeer Influenced and Corrupt Organizations (RICO) law, as well as making claims for breach of contract against the group that Google says published at least 87 crypto scam apps on Google Play.
It named Yunfeng Sun, aka Alphonse Sun, and Hongnam Cheung, aka Zhang Hongnim or Stanford Fischer, as the alleged culprits, saying they lured victims to download the apps via text messages campaigns on Google Voice, videos on YouTube and affiliate marketing schemes.
It remains to be seen if Google can obtain sanctions against the individuals involved, however. Currently, there is no reciprocal juridical enforcement agreement between the U.S. and China, meaning that even if the lawsuit prevails, Chinese authorities will not have any obligations to enforce it within its territory.
Popular crypto exchange Crypto.com, which has more than 80 million users globally, will expand to South Korea by the end of the month. As reported by The Korea Economic Daily, Crypto.com will launch on April 29 and will initially only feature coin-to-coin transactions and nonfungible tokens.As part of the app launch and in line with regulations, Crypto.com gave a 30-day notice to users of its acquired OK-BIT platform that it was ceasing services when the Crypto.com app goes live.
The firm’s ultimate goal is to expand into the fiat Korean won to crypto market for users. However, the country’s regulators are quite strict in their enforcement of crypto laws. To operate fiat-to-crypto exchanges in Korea, an entity must onboard a local bank as a money transmitter partner, go through regular financial audits, and comply with all Know Your Customer and Anti-Money Laundering requirements.
“Our goal is to review this and soon support won-denominated transactions in line with the Virtual Asset User Protection Act that will take effect in July,” said Patrick Yoon, CEO of Crypto.com Korea.
Hong Kong gaming firm invests another $1 million into crypto
Hong Kong gaming firm Boyaa Interactive, which has pledged $200 million to invest in cryptocurrencies in the past year, will partner with Pacific Waterdrip Digital Asset Fund SPC for a $1 million investment into metaverse, nonfungible tokens, and blockchain infrastructure-related projects.
“The Board of Directors believes that this investment and cooperation will further promote the Group’s business development and layout in the Web3 field,” Boyaa staff wrote on April 2. “It also indicates that the Group will deepen its efforts in the Web3 field and make use of the Group’s rich experience accumulated in the internet gaming field and the good opportunities of Hong Kong’s new Web3 policy to create a pure and leading listed Web3 company.”
Boyaa’s partner in the initiative, Waterdrip Investment, has a portfolio composed of over 150 Web3 projects, such as Canadian licensed crypto exchange Virgoc, digital assets custodian Safeheron, and Bitcoin layer-2 solution Merlin Chain.
Bitcoin L2 solution secures partnership with Hong Kong-listed company
Sinohope, a Hong Kong Stock Exchange-listed crypto custodian firm founded by Huobi co-founder Jun Du, partnered with Bitcoin layer 2 solution Merlin Chain on April 4 to improve the security of Bitcoin scaling solutions.
Sinohope’s Bitcoin layer 2 co-management solution will allow multi-party joint custody for Bitcoin and BRC-20 tokens via its wallet-as-a-service (WaaS). Meanwhile, Merlin Chain will help Sinohope bridge Bitcoin and BRC-20 tokens to Sinohope’s WaaS and improve its fund security.
Created by Bitcoin ecosystem developer Bitmap, Merlin Chain allows Bitcoin, BRC-20, Ordinals, Atomicals and BRC-420 metaverse assets to be swapped between nonfungible and fungible tokens and is also Ethereum Virtual Machine (EVM) compatible. The protocol has attracted a total value locked of over $3.5 billion since its launch in January.
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Hokkoku Bank launches first Japanese deposit-based stablecoin
Japanese bank Hokkoku launched the country’s first deposit-enabled stablecoin on April 1. Dubbed “Tochituka,” the token is minted via customers’ deposits at Hokkoku registered bank accounts at a 1:1 ratio with the Japanese yen. The Tochituka stablecoin can be used in Suzu City, Ishikawa Prefecture, with a 0.5% processing fee levied by the bank for commercial transactions and a 110 yen ($0.73) monthly account fee.
“Users can send Tochituka to each other,” Hokkoku wrote. “We also plan to implement the interpersonal remittance function by the end of 2024. We also collaborate with other financial institutions to introduce services, providing the convenience of being able to use each other’s services in areas across the country.”
The bank also plans to expand the adoption of the stablecoin to other municipalities and prefectures.
Singaporean Web3 gaming firm raises $10 million
Web3 gaming firm Gomble has secured a total of $10 million in funding as of April 3 from the likes of Spartan, Hashed, IOSG Ventures, Foresight Ventures and Big Brain Holdings, continuing its momentum from 2023, when it raised in a round led by Binance Labs and Animoca Brands.
Gomble seeks to establish “a self-sustainable economy” where gamers generate revenue based on user engagement and take part in game development through its decentralized autonomous organization.
The firm has built a total of 12 games on Google Play and App Store. One such game, Copy Runner, takes place where users utilize a simple tap-to-jump mechanism to navigate a dynamic cityscape and earn rewards. Players can then turn their score into token incentives after completing daily tasks from different games and exporting their score to the Gomble Games main site.
Hong Kong asset manager touts spot Bitcoin ETF application
Value Partners, a Hong Kong investment firm with $5.6 billion in assets under management, is seeking to launch a spot Bitcoin ETF to meet investor demand. As disclosed in its annual report on April 2:
“We are also exploring new product ideas for our ETF brands. In January 2024, we signed a memorandum of understanding with a licensed Hong Kong digital asset management company to discuss launching a Bitcoin spot ETF in the city to provide investors with the world’s largest digital assets.”
The firm did not say who its crypto custody partner was or when it plans to submit its spot Bitcoin ETF application. In a March 26 X post shared by Bloomberg ETF analyst Eric Balchunas, the analyst explained that Hong Kong’s financial regulators could aim to offer in-kind creation models for spot Bitcoin ETFs where it’s Bitcoin in, ETF out compared to vice versa for their U.S. equivalents.
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Zhiyuan Sun
Zhiyuan Sun is a journalist at Cointelegraph focusing on technology-related news. He has several years of experience writing for major financial media outlets such as The Motley Fool, Nasdaq.com and Seeking Alpha.
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