September 1st, 2025

Global Game Theory: How America’s Bitcoin Policy Is Reshaping the World

Bitcoin Conference Asia – Hong Kong, August 28, 2025- At the heart of Bitcoin Conference Asia’s main stage, a powerful conversation unfolded under the theme *“Global Game Theory: The Response to America’s Changing Bitcoin Policy.”* With the United States now positioning itself as a self-declared “Bitcoin superpower,” the ripple effects are being felt across continents, from Singapore to Pakistan, from policy corridors to crypto exchanges. This panel, moderated by Greg McCarty, Co-Founder and Co-President of the Bitcoin Policy Institute, brought together four influential voices shaping the global Bitcoin narrative: Anndy Lian, blockchain advisor and author; Jeremy Tan, Singaporean political candidate and Bitcoin advocate; Bilal Bin Sakib, Minister of State for Blockchain and Crypto in Pakistan; and Nentur Chao, Global CEO of Bitmart Exchange.

What emerged was not just a discussion about regulation or technology but a geopolitical reckoning. As the U.S. accelerates its pro-Bitcoin agenda, countries and companies worldwide are reevaluating sovereignty, financial infrastructure and national identity through the lens of digital gold.

Greg McCarty opened the panel with a bold statement. In the last twelve months, the world has seen a massive shift in global Bitcoin policy and it started in Washington. He outlined a series of transformative developments since early 2025. The United States now has a firmly pro-Bitcoin administration that has issued executive orders declaring its intent to become a global Bitcoin superpower. The country has established a strategic Bitcoin reserve worth ten billion dollars. It has passed the Genius Act, a landmark piece of stablecoin legislation, and is moving forward with comprehensive cryptocurrency market structure legislation. Support for the industry is now unified across Congress, federal agencies and the executive branch.

This is not merely a policy shift. It is a strategic signal to the world. Bitcoin is now recognized as a national asset of critical importance. The implications are profound. Countries can no longer afford to treat Bitcoin as a speculative or fringe technology. It has entered the realm of monetary sovereignty, energy policy, youth empowerment and international diplomacy.

Bilal Bin Sakib, representing Pakistan, the fifth most populous nation on Earth with 250 million people and a youth population that makes up 70 percent of the total, shared his country’s ambitious vision. Pakistan is turning its challenges into opportunities by transforming liabilities into digital gold. With between forty and fifty million active crypto users and two thousand megawatts of excess electricity, the nation is redirecting surplus power toward Bitcoin mining. The government has announced a national Bitcoin strategic reserve using bitcoins seized by law enforcement. It has also created the Pakistan Virtual Asset Regulatory Authority, an independent body separate from the central bank and securities commission, to foster innovation in the crypto space.

Sakib emphasized that Pakistan’s strength lies in its human capital. The country is the third largest freelancer market in the world. If Pakistan’s youth were their own nation, they would rank as the tenth largest country globally. With fifty thousand IT graduates entering the workforce each year, the foundation is set for a homegrown tech revolution. The goal is not just to participate in the global crypto economy but to lead it by building billion dollar protocols from within Pakistan. At the same time, the country faces serious socioeconomic challenges, including one hundred million unbanked citizens. Blockchain technology offers solutions not only for financial inclusion but also for improving government efficiency and combating counterfeiting. Bitcoin is important, but blockchain is the infrastructure that will power the future.

Jeremy Tan, who ran for Parliament in Singapore on a platform advocating for Bitcoin in national reserves and became the best performing independent candidate in fifty years, framed Bitcoin as a matter of national survival. Singapore lacks natural resources and depends heavily on its status as the fourth largest foreign exchange hub in the world. But if financial liquidity begins to migrate on chain through stablecoins, yield protocols and decentralized markets, the rationale for maintaining physical financial centers comes into question.

Tan pointed to a troubling statistic. Singapore had only one initial public offering on its local stock exchange in the past year. As capital flows increasingly toward Bitcoin and decentralized platforms, traditional financial hubs may find themselves obsolete. He also highlighted a cultural truth common across East Asia. There is a deep seated preference for hard assets such as property. However in land constrained societies like Singapore and Hong Kong, this pursuit of real estate has created a generational burden where each new cohort must pay more than the last. This dynamic is unsustainable, especially in an era of artificial intelligence and economic uncertainty.

Bitcoin offers an alternative. It is a scarce, portable and globally accessible hard asset. But adoption requires education. Tan recently visited El Salvador and met with President Bukele and his team, including Stacy Herbert of the Bitcoin Office. He was impressed by their national education campaigns that teach children the nature of money from an early age. This is something often taken for granted in Asian cultures. Tan believes that financial literacy must be prioritized, not only for youth but also for government officials and bureaucrats who shape policy. Many in power hold strong opinions about Bitcoin, but those views are often based on misinformation or fear. Without proper understanding, progress stalls. To address this, Pakistan and El Salvador have begun a joint initiative in Bitcoin diplomacy, sharing frameworks and training government officials to make informed decisions.

Nentur Chao of Bitmart Exchange, which serves over twelve million users worldwide, provided a real time perspective from the private sector. He confirmed that the shift in U.S. policy has created a positive halo effect across the industry. Institutional adoption is accelerating, with public companies increasingly adding Bitcoin to their treasuries. However, user behavior tells a more complex story. After a surge in trading volume during the first quarter of the year, spot Bitcoin transactions have declined by twenty to twenty five percent. Derivatives trading, on the other hand, has remained steady, indicating that institutions continue to use these tools for hedging and strategic positioning. Among retail traders, eighty percent of derivative positions are closed within twenty four hours, pointing to a high frequency, speculative mindset.

Beyond the data, Chao shared a deeper trend. Governments around the world are reaching out to exchanges and industry leaders not to impose restrictions but to learn. He has participated in numerous closed door discussions with quasi governmental bodies seeking to understand market risks, compare regulatory models and refine their own policy drafts. There is a clear demand for knowledge, but a notable lack of coordination between nations. Countries are working in isolation, repeating the same mistakes and missing opportunities for collaboration.

Chao praised Hong Kong’s Leap 2.0 regulatory framework as a leading example of forward thinking policy. From the outset, the framework allows for the tokenization of real world assets such as government bonds, ETFs, commodities and renewable energy credits. This creates immediate utility and attracts institutional capital. It moves the ecosystem from zero to one quickly and enables further innovation. Such an approach, he argued, is essential for any jurisdiction that wants to be a serious player in the digital asset economy.

Anndy Lian offered a measured but strategic perspective. While he applauds the speed of U.S. policy development, he cautioned that not every country is ready to follow the same path. Legislation in America is advancing at an extraordinary pace, but much of Asia is still in a catch up phase. Nations like Japan, South Korea and the Philippines are making progress, but they are doing so step by step. First, they are tokenizing traditional assets such as stocks and corporate equity. Then they are establishing stablecoin regulations. Only after these foundations are in place will they consider holding Bitcoin in national reserves.

The key, Lian emphasized, is building a strong foundation. You cannot construct a sustainable Bitcoin economy on weak regulatory or educational ground. He criticized what he called performative policy making, where high profile figures visit a country, take photos and leave without substantive dialogue. This is public relations, not policy. What is missing is a serious, standardized global conversation. He proposed the creation of an international body for digital assets, similar to the International Civil Aviation Organization or the Bank for International Settlements. Such a body could establish baseline regulatory standards for exchanges, custody solutions and stablecoins, allowing countries to collaborate rather than compete in confusion.

Lian also urged governments to take decentralized finance and decentralized networks seriously. Too many policymakers view DeFi as a haven for illicit activity, but this reflects a lack of understanding. These systems represent the next evolution of finance and must be studied, regulated wisely and integrated thoughtfully.

As the panel drew to a close, each speaker offered a vision for the next phase of Bitcoin adoption. Nentur Chao highlighted Hong Kong’s Leap 2.0 framework as a model for enabling real world utility from day one. Anndy Lian called for the creation of a global regulatory body to bring coherence to a fragmented landscape. Jeremy Tan proposed that every country establish a dedicated Ministry of Blockchain and Bitcoin to serve as a single point of contact for international coordination. Bilal Bin Sakib reiterated that Bitcoin must be used to solve real problems, from financial inclusion to youth unemployment and government inefficiency.

Greg McCarty tied these threads together by reflecting on the mission of the Bitcoin Policy Institute. The organization was founded because no one else was doing the difficult work of educating policymakers. You cannot make sound decisions about a technology you do not understand. For years, the institute focused simply on explaining what Bitcoin is and how it works. Only after that foundation was laid could they begin advocating for strategic reserves and national adoption.

The takeaway is clear. The Bitcoin revolution is not just about code or capital. It is about clarity, education and long term thinking. As the United States leads with bold policy, the rest of the world is not merely copying but adapting, innovating and building solutions suited to their unique contexts. From Pakistan’s energy to digital gold pipeline to Singapore’s existential pivot, from Hong Kong’s institutional on ramps to global calls for cooperation, the game has changed.

Bitcoin is no longer a question of if but of how. And the rules of this new global game are being written in real time, not in Washington alone, but in boardrooms, parliaments and classrooms across Asia and beyond.

Anndy Lian

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com

j j j

August 25th, 2025

Powell’s pivot: How Jackson Hole reshaped markets and what comes nex

The financial landscape presents a compelling narrative of shifting tides and strategic recalibration as we navigate the final stretch of August. Recent developments emerging from Jackson Hole have fundamentally reshaped market expectations, creating a domino effect across asset classes that demands careful dissection.

Federal Reserve Chair Jerome Powell’s carefully calibrated remarks last Friday did far more than hint at potential policy shifts; they effectively slammed the door on prolonged restrictive monetary policy while opening a wide window for immediate easing.

This pivot represents a significant departure from the Fed’s previous stance and carries profound implications for investors globally. Market participants responded with characteristic speed, pushing major US indices to fresh record highs as the S&P 500 gained 1.52 per cent and the tech-heavy Nasdaq surged 1.88 per cent.

The Dow Jones Industrial Average joined this upward trajectory, climbing 1.89 per cent to touch uncharted territory, a development underscored by the US government’s strategic investment in a major semiconductor manufacturer, which provided additional tailwinds for industrial and technology sectors.

Inflation cools, optimism rises

This renewed optimism stems directly from Powell’s acknowledgement that inflation has sufficiently cooled to warrant policy adjustment. His speech deliberately avoided the cautious hedging that characterised previous communications, instead emphasising the Fed’s readiness to act decisively should inflation continue its descent toward the two per cent target.

The immediate market reaction proved remarkably consistent across fixed income and currency markets. Treasury yields tumbled across the curve with the benchmark 10-year note falling 7.4 basis points to 4.254 per cent, while the two-year note dropped 9.5 basis points to 3.696 per cent. This yield compression reflects investor conviction that the current restrictive policy stance is temporary.

Concurrently, the US Dollar Index retreated 0.92 per cent as capital flowed toward risk assets while gold prices rebounded one per cent on the dual catalysts of dollar weakness and heightened rate cut anticipation. These movements collectively signal a powerful shift in market psychology where the so-called Fed put, the implicit promise of central bank support during market stress, has been reactivated with unusual clarity.

Earnings season exposes a split reality

The earnings season provides a critical counterpoint to this macro optimism, revealing a more nuanced corporate reality beneath the surface. While the much-discussed Magnificent Seven technology giants delivered robust results exceeding lowered expectations, the broader market tells a different story. Analysis of S&P 500 earnings revisions shows a troubling pattern of downward adjustments for the remaining 493 companies.

This bifurcation creates a dangerous illusion where headline index performance masks underlying weakness in the economic mainstream. Investors now turn their attention to the final wave of quarterly reports from key technology players, including Nvidia, CrowdStrike, Snowflake, and Autodesk, alongside consumer stalwarts Lululemon and Dollar General.

These results will serve as crucial stress tests for both the technology sector’s growth trajectory and consumer resilience amid persistent inflationary pressures. The market eagerly awaits these reports not merely for individual company performance but for what they reveal about broader economic health and corporate pricing power.

Asia’s liquidity pressures and regional sentiment

Asian markets present their own complex dynamics, particularly Hong Kong’s interbank rate market, which has exhibited unusual volatility. The one-month Hong Kong Interbank Offered Rate Hibor has surged dramatically from 1.0 per cent on August 11 to 2.77 per cent as of August 22.

This sharp increase reflects significant tightening in short-term liquidity conditions, likely driven by seasonal funding demands and potential regulatory adjustments. Such movements warrant close monitoring as they can transmit stress through global financial channels.

Despite these regional headwinds, Asian equity markets opened higher during early trading sessions today, suggesting regional investors remain influenced by the broader risk-on sentiment emanating from Powell’s comments. Yet US equity index futures currently indicate a potential pullback at today’s open, introducing an element of caution that underscores the market’s fragile equilibrium.

Crypto’s reaction: from Bitcoin to Ethereum

The cryptocurrency sector experienced particularly dramatic fluctuations following Powell’s speech, creating a fascinating case study in market psychology and whale behaviour. Bitcoin initially surged above US$67 000 following the dovish Fed commentary as traders anticipated lower interest rates would boost risk asset valuations.

However, this rally proved short-lived with the digital asset subsequently declining approximately two per cent. Blockchain analytics firms identified significant movement by large holders shifting substantial Bitcoin positions into Ethereum, a trend that accelerated over the weekend.

Lookonchain data revealed one prominent wallet recently converted part of its 100,784 Bitcoin holdings to acquire 62,914 Ethereum tokens while simultaneously establishing a large derivatives position. This strategic rotation by major players suggests a fundamental reassessment of digital asset allocation priorities, where Ethereum increasingly appears as the preferred vehicle for institutional exposure to the crypto ecosystem.

Ethereum’s technical indicators present both opportunity and warning signs that demand careful interpretation. The cryptocurrency’s 30 day Market Value to Realised Value MVRV ratio has reached 15 per cent a threshold historically associated with profit taking and potential corrections.

Analytics firm Santiment explicitly warns that this constitutes a danger zone that could trigger selling pressure if Ethereum fails to break US$5,000 in the near term. Yet this short-term caution contrasts with the more favourable long-term MVRV ratio of 58.5 per cent, indicating substantial unrealised gains for patient holders.

Additional bullish signals include the declining supply of Ethereum held on exchanges, which suggests growing investor confidence and reduced immediate selling pressure. Combined with rising staking participation and expanding decentralised finance DeFi activity, these fundamentals position Ethereum as the structural cornerstone of the crypto economy rather than merely a speculative alternative.

Strategic imperatives for investors

For investors navigating this complex environment, several strategic imperatives emerge clearly.

First, the renewed viability of the Fed puts creates a tactical opportunity to accumulate quality assets during periods of volatility. Well-capitalised investors should view market pullbacks as entry points for fundamentally strong companies, particularly those demonstrating pricing power and resilient cash flows.

Second, the rotation from Bitcoin to Ethereum observed among major holders warrants serious consideration as it reflects a maturation of institutional crypto strategies. Dollar cost averaging into Ethereum provides a prudent approach to managing volatility while maintaining exposure to the asset’s long-term potential.

Third, investors should actively hedge existing cryptocurrency positions using options or futures contracts to protect against potential corrections, especially given the current MVRV warning signals.

Fourth, attention must remain fixed on Ethereum’s technological roadmap, where continued protocol upgrades like further implementation of EIP 4844 will drive sustainable value creation beyond mere speculation.

The road ahead: Volatility and value

The coming weeks will test the durability of this optimistic market posture as investors confront key data points, including the August CPI inflation report, consumer sentiment figures, and potential developments on trade policy. Historical precedent suggests September often brings increased market volatility; the current environment differs significantly from past cycles due to the Fed’s explicit commitment to policy normalisation.

While technical indicators show investor positioning has become somewhat extended, introducing near-term correction risks, the fundamental backdrop of potential rate cuts, combined with resilient corporate earnings, supports continued market advancement. The critical distinction this time involves the quality of the underlying assets driving the market.

Unlike previous cycles, where broad-based speculation fuelled gains, the current environment rewards careful stock selection focused on companies with demonstrable earnings power and sustainable competitive advantages.

This nuanced market landscape demands intellectual rigour and disciplined analysis from investors. The days of indiscriminate buying are over, replaced by an era requiring a granular understanding of both macroeconomic currents and individual company fundamentals.

Powell’s Jackson Hole speech has reset market expectations in profound ways, creating both opportunity and risk that will define investment outcomes for the remainder of 2024. Investors who combine patience with strategic precision while avoiding emotional reactions to short-term volatility will best position themselves to navigate the complex months ahead.

The market’s message is unambiguous: lower rates are coming, but their arrival does not guarantee universal gains. Success will belong to those who recognise that the Fed’s policy shift merely creates favourable conditions; the real work of identifying enduring value remains squarely the investor’s responsibility.

As we move toward September’s pivotal Federal Reserve meeting, the financial world watches with bated breath, knowing that the decisions made in the coming weeks will reverberate through markets for years to come.

Source: https://e27.co/powells-pivot-how-jackson-hole-reshaped-markets-and-what-comes-next-20250825/

Anndy Lian

www.anndy.com

j j j

August 10th, 2025

How North Korea’s US$1.5 billion hack exposed Asia’s crypto weaknesses

It began, as so many epochal crimes do, with a single breach. But by the time the dust had settled on the Bybit hack, nearly US$1.5 billion in digital assets had vanished, exposing not just the vulnerabilities of Asia’s fledgling crypto markets but the growing reach of North Korea’s cyber operatives.

The hack on February 21 represented a quantum leap in the scale and sophistication of cyber operations emanating from North Korea, according to a report released last month by American blockchain analysis firm Chainalysis.

It accounted for nearly 70 per cent of all stolen digital assets globally in the first half of 2025 – laying bare the widening security cracks in Asia’s digital ecosystem and signalling the arrival of a new era of cybercrime that is increasingly targeting victims around the globe, from Bybit’s Dubai headquarters to the United States and beyond.

Last year, North Korea-linked cybercriminals were responsible for an estimated US$1.3 billion in losses, then the highest figure on record. But this year is shaping up to be even worse for the victims, with Pyongyang’s state-sponsored hackers on track to reap even greater illicit rewards, according to the Chainalysis report.

Experts warn that the sheer size of the Bybit heist is not the most alarming element. The degree of technical proficiency, coupled with clear signs of state involvement, have raised concerns that the stolen funds are being funnelled directly into North Korea’s arms and weapons programmes, fuelling instability far beyond the digital realm.

“While North Korea typically doesn’t claim responsibility for these cyber exploits, extensive evidence has linked them to sophisticated hacking groups like the Lazarus Group,” Diederik van Wersch, regional director for Asean at Chainalysis, told This Week in Asia.

The Lazarus Group, a shadowy collective of state-sponsored cybercriminals infamous for siphoning off billions from the cryptocurrency industry, is thought to be behind the Bybit hack. The group’s modus operandi? Exploiting security vulnerabilities in order to finance the North Korean regime by employing complex laundering methods to obscure the trail of stolen funds.

“These aren’t merely cybersecurity incidents, they represent significant national security concerns,” van Wersch warned. “The UN has confirmed that North Korea uses these stolen funds to finance its weapons programmes, making these attacks a direct threat to international security.”

The United States and its allies have repeatedly accused Pyongyang of using cyberattacks to fund its military and nuclear ambitions.

Pyongyang has never officially acknowledged any connection to the Lazarus Group, but it is believed to be unique in its state-directed quest for financial gain through hacking. Its operations, which include advanced social engineering and the infiltration of crypto platforms via compromised IT staff, have set a new standard for financial cybercrime.

Asia: cybercrime epicentre?

The dangers are not confined to any one country. Southeast Asia – Cambodia, Myanmar and Laos, in particular – has now become a global hub for cybercrime, cybersecurity experts say, driven by a toxic mix of weak rule of law, authoritarian protection and economic desperation.

International sanctions and the closure of criminal platforms such as Russia’s Garantex and Cambodia-based Huione Guarantee have barely made a dent in the volume of illicit cyber transactions, which Chainalysis estimates hit US$51 billion worldwide in 2024 alone.

Against this backdrop, North Korea’s relentless focus on cryptocurrency theft had been propelled by US-led sanctions strangling its other revenue streams, said Anndy Lian, a Singapore-based intergovernmental blockchain adviser.

“It seems likely that this phenomenon could inspire other countries, particularly those facing political instability or sanctions, to engage in similar activities,” he said. “However, replicating North Korea’s capabilities requires significant investment in cyber infrastructure and expertise, which may be challenging.”

Research suggests that while North Korea leverages a mixture of services to launder its gains, other nations that lack its technical sophistication would indeed struggle to emulate its success.

The technical prowess of Pyongyang’s hackers was now such that it allowed them to “target even well-versed cybersecurity professionals”, Lian said, adding that their increasingly elaborate laundering networks complicated the recovery of stolen assets.

In Asia’s other cybercrime hotspots, such as Myanmar and Cambodia, the focus has tended to be more on scamming and money laundering, but this threat matrix now appears to be evolving.

According to Chainalysis, 2025 has seen a marked expansion of cybercriminal activities: more laundering, larger cross-border networks and a disturbing rise in physical violence.

‘Wrench attacks’

For the hackers’ victims the pain can be both financial and physical. Chainalysis in its report described a “particularly disturbing subset” of recent thefts known as “wrench attacks”.

Far less sophisticated than the image of an invisible hand picking the digital pockets of unsuspecting crypto adopters, these actual assaults rely on violence and threats of force to extract assets from victims.

The kidnapping and murder of Chinese-Filipino tycoon Anson Que, former CEO of Ellison Steel, earlier this year provided a chilling example of these so-called wrench attacks in action. Investigators believe his death was linked to ransom payments laundered through casino gaming and digital shell accounts to obscure the money trail.

Meanwhile, Asia’s digital boom has in many ways made it a magnet for cybercriminals. Japan, Indonesia and South Korea now rank among the world’s leading victims of stolen digital funds, reflecting not only their increasing adoption of crypto but also their exposure to North Korean hackers – with the infamous 2016 Bank of Bangladesh cyber heist being an early and illuminating case in point.

That US$81 million theft from the bank’s account at the Federal Reserve Bank of New York was one of the largest cyber heists ever recorded at the time. The attack, attributed to the Lazarus Group, was ultimately traced back to servers in the Philippines, where much of the stolen money was laundered through casinos.

A decade on and the “velocity and consistency” continues to grow exponentially, Chainalysis warns. It took hackers just 142 days this year to surpass the US$2 billion mark in global losses, compared to 214 days in 2022. At this rate, total losses could exceed US$4.3 billion by year’s end, the report warned.

The soaring prices of cryptocurrencies and other digital tokens have only made things worse. Bitcoin, for example, hit an all-time high of more than US$123,000 last month, buoyed in part by favourable signals from US President Donald Trump’s administration and a growing global appetite for crypto assets.

Chainalysis data shows that attackers are now deliberately targeting high-value individual wallets, with bitcoin theft accounting for a disproportionate share of losses. As asset values rise, the incentive for thieves grows ever larger.

“The current crypto market momentum also presents increased opportunities for attackers,” van Wersch said, adding that the liquidity and cross-border nature of digital tokens made them especially attractive targets.

Experts warn that advanced economies such as South Korea and Japan are especially exposed to hacks due to their proximity to North Korean actors and their thriving crypto markets, while emerging economies like Indonesia are also at risk as digital finance gains in popularity.

“Geopolitical tensions may motivate North Korea to target these nations, as seen in reports linking attacks to historical adversaries,” Lian said of Japan and South Korea.

Building smarter defences

Amid the surge in cybercrime, there are signs of hope. Advances in tracing cryptocurrency transactions now allow for near-instant tracking of funds and the transparency of blockchain technology provides some measure of visibility into illicit flows.

“As jurisdictions like Hong Kong move forward with progressive stablecoin legislation, the focus should be on building robust security alongside innovation,” van Wersch said.

“The key is implementing sophisticated real-time threat monitoring systems and leveraging advanced blockchain analytics that can help prevent attacks before they occur.”

Real-time monitoring and predictive technologies are set to become indispensable, as hackers probe for vulnerabilities across the region’s digital infrastructure. Crypto exchanges, in turn, must demonstrate to regulators and users alike that they can safeguard funds against increasingly resourceful adversaries, according to van Wersch.

Jake Sims, founding partner of Operation Shamrock – a global coalition working to disrupt Southeast Asian cybercrime networks – stressed the complexity of taking on state-linked actors, as well as the risks of financial contagion.

“The use of crypto for laundering cyber-scam proceeds certainly erodes public and regulatory confidence in digital assets,” he said. “Unresolved enforcement gaps in Southeast Asia risk contaminating broader digital finance ecosystems.”

Earlier this year, Hong Kong was ranked as the second-most crypto-friendly city in the world, behind only the Slovenian capital of Ljubljana, by migration platform Multipolitan.

Regional rival Singapore, meanwhile, was recently named as one of the most crypto-obsessed countries globally, after research from digital asset exchanges ApeX Protocol and Taurex found nearly one in four Singaporeans owned cryptocurrency in 2024.

Recent high-profile attacks have exposed the urgency with which robust defences need to be built. In July last year, US$235 million was stolen from Indian crypto exchange WazirX by North Korean hackers masquerading as legitimate users – a breach that ultimately led to the closure of the platform and a restructuring plan by its Singapore-based parent Zettai.

Lian said such incidents had exposed persistent weaknesses in the security of even major exchanges and risked provoking a regulatory backlash that could stifle digital innovation.

Hong Kong, which has spent years steadily building a regulatory framework for virtual assets, has so far licensed 10 virtual asset trading platforms including New York-based Bullish, which in February became the first international crypto exchange to gain approval in the city.

Experts are now calling for regional and international cooperation, from establishing intelligence-sharing platforms to harmonising cryptocurrency regulation, to help reduce risks.

Joint efforts under the aegis of the United Nations might exert much-needed diplomatic pressure, Lian suggested, while targeted sanctions could help stem the tide of cyber crimes.

A “harm minimisation approach” targeting revenue streams and increasing reputational costs and legal expenses for jurisdictions that host cybercriminals was another option, Sims said.

Regulators needed to strengthen both domestic security and cross-border collaboration, he argued, possibly through task forces operating outside the Association of Southeast Asian Nations.

“A subregional task force outside formal Asean structures may actually be more effective for constraining harms emerging in high-risk contexts, like Cambodia where political will is lacking,” Sims said.

Despite differing international treatment, Sims said that North Korea and Cambodia shared “significant similarities … in terms of the degree of consolidated coercive power, the degree of state involvement in criminal activity, and the global reach of state-embedded criminal industries”.

The recent border conflict with Thailand could also lead “Cambodia’s scam-invested elite to look away from the Thai border as they evaluate new locations”, he said. “But it is important to note that scam compounds in Cambodia are everywhere.”

So what of Asia’s digital future? While new tools built using artificial intelligence can flag scam scripts and analyse transaction patterns for signs of deep-faked identities, Sims cautioned that technology alone was insufficient to combat cybercrime.

“These tools will need to be complemented by human intelligence, as well as policy reforms and enforcement mechanisms,” he said. “Without political will and cross-border cooperation, AI and other technological interventions will only offer partial mitigation.”

For now, it would seem that no one is immune. The Bybit hack may have set a new record, but it is unlikely to be the last. Asia’s digital future will depend on what happens next.

Source: https://www.scmp.com/week-asia/economics/article/3321262/how-north-koreas-us15-billion-hack-exposed-asias-crypto-weaknesses