Asian nations more cautious of crypto regulation after Hamas taps digital assets for Israel strike

Asian nations more cautious of crypto regulation after Hamas taps digital assets for Israel strike

Kapoor, who was a speaker at one of the G20 committee meetings on cryptocurrency assets, said the statement had not been translated into action. It was time to revisit the declaration and come up with solutions to back it, he said.

Digital-currency wallets that Israeli authorities linked to the PIJ received as much as US$93 million in cryptocurrency between August 2021 and June this year, the WSJ report said, citing analysis by crypto researcher Elliptic.

Wallets connected to Hamas received about US$41 million over a similar time period, the report added, citing research by crypto analytics and software firm BitOK that is based in Tel Aviv.

“Some countries may bring up the narrative that banning cryptocurrencies is the way forward,” said Anndy Lian, Singapore-based author of the book NFT: From Zero to Hero.

“I would argue that banning cryptocurrencies would not stop terrorist financing, but rather drive it underground and make it harder to trace and stop,” he added. “Cryptocurrencies can be traced and tracked, while fiat (currency) such as US dollars cannot.”

Singapore and Hong Kong have regulated cryptocurrency markets, but most of the governments in the region are just beginning to understand the power of cryptocurrencies that could open up new financing opportunities.

However, investors’ faith has been time and again been tested by scandals and collapses of digital exchanges.

Hong Kong’s cryptocurrency sector was recently hit by a JPEX scandal in which more than HK$1.5 billion (US$192 million) went missing, prompting complaints against an ostensibly Hong Kong-based exchange, run by people who have still not been identified.

The revelation about Hamas funding could add to public discomfort, analysts said.

“The disclosure about Hamas could potentially lead to stricter regulations and enhanced scrutiny of crypto transactions in Singapore. It may prompt the MAS to enhance its oversight and enforcement of the crypto sector, as well as to collaborate more closely with other countries to prevent and disrupt terrorist financing through digital assets,” Lian said, referring to Singapore’s central bank.
The Monetary Authority of Singapore (MAS) has been taking measures to regulate the cryptocurrency industry, and has been one of the first to regulate the sector in Asia. Hong Kong has been following Singapore’s lead.

“While the government recognises the economic and social potential of cryptocurrency, it is also cautious about identifying and managing risks involved, such as consumer protection and anti-money-laundering/counter-financing of terrorism,” Lian added.

But cryptocurrencies could easily be tracked down “so this may not be the best way for terrorist organisations”, said Singapore-based Branson Lee, who runs custody solution provider Custodize.com.

“Finally, there are many tools to track and trace these funds. Overall, the crypto industry remains aware of these risks and has done well since to conform to many regulations from FATF (Financial Action Task Force) to jurisdictional compliance,” he said.

Southeast Asia, with nearly 700 million residents, has one of the world’s fastest-growing populations, with some 480 million of them as active internet users.

Consumers in countries like Vietnam and India have been among the fastest worldwide to adapt to cryptocurrencies, but authorities in many other places have not yet found a path to govern the ecosystem effectively.

India does not have any specific cryptocurrency regulations in place, but has been working on introducing legislation.

Earlier this month, local media reported that a probe by Indian police brought to light a case where 3 million rupees (US$36,000) in cryptocurrency was stolen from the digital wallets of a Delhi-based businessman and transferred to the accounts of Hamas.

Manhar Garegret, India head at digital wallet Liminal, highlighted that Hamas had launched campaigns on social media to raise funds through cryptocurrency, but Israel used its technical know-how to block the crypto accounts.

The case of digital theft in Delhi together with the report on Hamas funding showed why each country needed to have standards for cryptocurrency regulation and use technical know-how to integrate into a global standard, Kapoor said.

“Criminals are always one step ahead, but if you reverse-engineer processes, then you can have some solutions,” he said. “Every country is vulnerable to some extent or the other.”

Source: https://emeatribune.com/asian-nations-more-cautious-of-crypto-regulation-after-hamas-taps-digital-assets-for-israel-strike/

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”.

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Asian nations more cautious of crypto regulation after Hamas taps digital assets for Israel strike

Asian nations more cautious of crypto regulation after Hamas taps digital assets for Israel strike
  • The use of crypto by Hamas is a warning for Asian nations looking to regulate digital assets, and highlights the need for standardised laws, analysts say
  • In Asia, just Singapore and Hong Kong have regulated cryptocurrency markets but scandals and collapses of crypto exchanges continue to test investors’ faith

The use of cryptocurrency by Hamas to fund its strike on Israel is likely to raise red flags in Asian countries that are framing regulations to govern the digital currency, and underscores the need for harmonising standards, analysts have said.

According to a report in The Wall Street Journal, three militant groups – Hamas, Palestinian Islamic Jihad (PIJ), and their Lebanese ally Hezbollah – received large amounts of crypto funds in the year leading up to the October 7 attack.

“It is a kick on the backside for most governments. All regulatory bodies will take a closer look at crypto regulation. Governments will need to start implementing new rules and regulations,” said Raj Kapoor, founder of India Blockchain Alliance.

At the G20 summit in New Delhi last month, a joint declaration called for the regulation, supervision and oversight of crypto assets, among other things, with the bloc saying it would support “a coordinated and comprehensive policy and regulatory framework”.

Kapoor, who was a speaker at one of the G20 committee meetings on cryptocurrency assets, said the statement had not been translated into action. It was time to revisit the declaration and come up with solutions to back it, he said.

Digital-currency wallets that Israeli authorities linked to the PIJ received as much as US$93 million in cryptocurrency between August 2021 and June this year, the WSJ report said, citing analysis by crypto researcher Elliptic.

Wallets connected to Hamas received about US$41 million over a similar time period, the report added, citing research by crypto analytics and software firm BitOK that is based in Tel Aviv.

“Some countries may bring up the narrative that banning cryptocurrencies is the way forward,” said Anndy Lian, Singapore-based author of the book NFT: From Zero to Hero.

“I would argue that banning cryptocurrencies would not stop terrorist financing, but rather drive it underground and make it harder to trace and stop,” he added. “Cryptocurrencies can be traced and tracked, while fiat (currency) such as US dollars cannot.”

Singapore and Hong Kong have regulated cryptocurrency markets, but most of the governments in the region are just beginning to understand the power of cryptocurrencies that could open up new financing opportunities.

However, investors’ faith has been time and again been tested by scandals and collapses of digital exchanges.

Hong Kong’s cryptocurrency sector was recently hit by a JPEX scandal in which more than HK$1.5 billion (US$192 million) went missing, prompting complaints against an ostensibly Hong Kong-based exchange, run by people who have still not been identified.

The revelation about Hamas funding could add to public discomfort, analysts said.

“The disclosure about Hamas could potentially lead to stricter regulations and enhanced scrutiny of crypto transactions in Singapore. It may prompt the MAS to enhance its oversight and enforcement of the crypto sector, as well as to collaborate more closely with other countries to prevent and disrupt terrorist financing through digital assets,” Lian said, referring to Singapore’s central bank.
The Monetary Authority of Singapore (MAS) has been taking measures to regulate the cryptocurrency industry, and has been one of the first to regulate the sector in Asia. Hong Kong has been following Singapore’s lead.

“While the government recognises the economic and social potential of cryptocurrency, it is also cautious about identifying and managing risks involved, such as consumer protection and anti-money-laundering/counter-financing of terrorism,” Lian added.

But cryptocurrencies could easily be tracked down “so this may not be the best way for terrorist organisations”, said Singapore-based Branson Lee, who runs custody solution provider Custodize.com.

“Finally, there are many tools to track and trace these funds. Overall, the crypto industry remains aware of these risks and has done well since to conform to many regulations from FATF (Financial Action Task Force) to jurisdictional compliance,” he said.

Southeast Asia, with nearly 700 million residents, has one of the world’s fastest-growing populations, with some 480 million of them as active internet users.

Consumers in countries like Vietnam and India have been among the fastest worldwide to adapt to cryptocurrencies, but authorities in many other places have not yet found a path to govern the ecosystem effectively.

India does not have any specific cryptocurrency regulations in place, but has been working on introducing legislation.

Earlier this month, local media reported that a probe by Indian police brought to light a case where 3 million rupees (US$36,000) in cryptocurrency was stolen from the digital wallets of a Delhi-based businessman and transferred to the accounts of Hamas.

Manhar Garegret, India head at digital wallet Liminal, highlighted that Hamas had launched campaigns on social media to raise funds through cryptocurrency, but Israel used its technical know-how to block the crypto accounts.

The case of digital theft in Delhi together with the report on Hamas funding showed why each country needed to have standards for cryptocurrency regulation and use technical know-how to integrate into a global standard, Kapoor said.

“Criminals are always one step ahead, but if you reverse-engineer processes, then you can have some solutions,” he said. “Every country is vulnerable to some extent or the other.”

Source: https://www.scmp.com/week-asia/economics/article/3238397/asian-nations-more-cautious-crypto-regulation-after-hamas-taps-digital-assets-israel-strike

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”.

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Israel-Palestine crisis: Navigating the intersection of conflict, aid and blockchain

Israel-Palestine crisis: Navigating the intersection of conflict, aid and blockchain

Top blockchain and crypto news: Gaza tensions, digital tremors, NFTs are not dancing in September, Joe Lubin talks traditional system’s twilight.

In this issue

  1. Gaza tensions, digital tremors
  2. NFTs: not dancing in September
  3. Lubin talks twilight: Traditional system’s eclipse

From the Editor’s Desk

Dear Reader,

It’s a geopolitical conflict with roots stretching back over more than a century. Yet the latest escalation of violence in Israel and Palestine this past week feels particularly shocking. Not least because the Hamas-led attacks throughout Israel over the weekend apparently caught the Israeli government, intelligence services and military — one of the world’s most well-provisioned — completely off-guard.

Reports have emerged suggesting that the militant group Hamas, the de facto political leadership in the Palestinian region of Gaza, used crypto transfers to raise millions of dollars in funds for the weekend’s attacks. It therefore appears we have once again seen financial access weaponized, as it always is in modern day conflict.

The hope now is that crypto steps up to take on a more positive role in what happens next. The blockchain, after all, is advertised as stateless, and permissionless. In its truest guise, it bypasses politics. It could be used here to get much needed humanitarian aid to civilians on both sides of this bloody conflict.

Local Web3 entrepreneurs set up an emergency crypto fund for Israeli victims of the violence — a move that we applaud and recommend readers seek out. But there are also more than 2 million Palestinian civilians inside Gaza who could benefit from financial aid delivered in the form of crypto.

As we have seen in this abhorrent incursion, civilians have cruelly been included in the attack equation. From afar, the complex web of history, politics, and homeland intertwine. On the ground, there are simply lives at stake.

Until the next time,

Angie Lau,
Founder and Editor-in-Chief
Forkast.News


1. Crisis? Bitcoin’s dual response

Israel’s cyber crimes unit, in conjunction with the National Headquarters for Economic Warfare, has announced the freezing of cryptocurrency accounts believed to be instrumental in raising funds for the Gaza-based Palestinian militant group, Hamas.

  • Israeli authorities have reportedly urged Binance, the world’s largest crypto exchange, to transfer the confiscated funds into Israel’s state treasury.
  • That follows a devastating series of attacks on Israel by Hamas over the weekend. The attacks, which included multiple atrocities against civilians, killed an estimated 1,200 people and wounded at least 2,700 others as of noon Thursday in Hong Kong.
  • In retaliation, Israeli warplanes have bombarded Gaza, a tiny strip of land some 40 km in length and home to over 2 million people. The air strikes have reduced large parts of the area to rubble, with 900 people reported killed and 4,500 injured. Reports indicate that the Israeli military has called up 350,000 reservists and may now be preparing for a ground assault on Gaza.
  • In response to this humanitarian crisis, a consortium of Israeli crypto companies has launched Crypto Aid Israel. This emergency fund aims to support Israeli citizens affected by the ongoing conflict. It is spearheaded by local crypto industry figures and companies such as Fireblocks, 42Studio, Market Across and CryptoJungle. They have teamed up with non-profit organizations to receive and deliver humanitarian aid to affected Israeli communities using cryptocurrencies such as Bitcoin, Ether and stablecoins like USDT and USDC.
  • Crypto has been used in conflict before. On-chain data shows that combatants and civilians on both sides of the Russo-Ukrainian war make use of cryptocurrencies as a way to receive and send funds. The use of crypto on both sides of the divide reveals crypto’s dual-edged nature as a tool designed to increase financial access, regardless of political affiliation, location, or intended use.
  • Six months into the conflict with Russia, Ukraine had already raised US$54 million in crypto donations, channeling it towards the provision of military essentials, medicine, and vehicles for their armed forces. On the flip side of that, pro-Russia militias also received over US$20 million in cryptocurrencies in the first year of the conflict.

Forkast.Insights | What does it mean?

The Middle East, as a pivotal hub for global oil production and transit, has long been a focal point of geopolitical tension reverberating through the global economy. When conflicts arise in the region, the immediate concern for markets is often the threat to oil supply chains. Physical infrastructure can be damaged, while fear of wider escalation stokes market uncertainties. Locations like the Suez Canal and the Strait of Hormuz become choke points for global oil supply.

However, the market impact is felt beyond the oil sector. Rising oil prices lead to higher transportation and production costs. As these costs surge, consumers feel the pinch, leading to inflationary pressures. Central banks, in a bid to stabilize economies, adjust monetary policies, which in turn further fuel inflation.

In the midst of these economic fluctuations, investors begin to search for stability. Historically, this stability was sought in gold, a time-tested “safe haven.” However, the digital age has ushered in another contender: Bitcoin.

Dubbed “digital gold” by some, Bitcoin offers certain features that make it attractive in times of uncertainty. Its capped supply makes it a potential hedge against fiat currency depreciation, especially at times of high inflation. Additionally, in regions with limited banking, the decentralized nature of Bitcoin can offer an alternative means of accessing financial services.

But Bitcoin’s journey amid geopolitical unrest is not a straightforward one. While some investors view it as a refuge, others might liquidate volatile assets like cryptocurrencies to cover losses or rebalance portfolios. This duality in investor sentiment can lead to sharp, unpredictable price movements in the Bitcoin market. On top of that, as Bitcoin’s ecosystem intertwines with the broader economy, significant spikes in global oil prices could impact the energy-intensive process of Bitcoin mining, affecting its network dynamics.


2. Wake me up when September ends

The NFT production on Ethereum reached an all-time low of US$17.55 million in September, marking a 12.4% decline from August’s US$20.05 million, according to data from Forkast Labs.

  • Prestigious NFT collections like Bored Ape Yacht Club and CryptoPunks saw a significant drop in their valuation, pointing to a potential shift in the broader market sentiment.
  • Forkast ETH NFT Composite, an index tracking the top 250 NFTs on Ethereum, plunged 48% year-to-date, hitting its low of 715.22 points in September.
  • Polygon’s NFT production experienced a dip, with September’s figures at a seven-month low of US$4.7 million. That was, nonetheless, an overall year-to-date increase of 219%.
  • Anndy Lian, NFT author, suggests the NFT hype from 2021 has tapered off, leading to a selective and realistic approach from buyers.
  • Major NFT marketplaces like OpenSea and Blur reported drops in monthly trading volumes by 31.8% and 38.3% respectively in September.
  • While the market faces challenges, global brands like Starbucks are still adopting NFTs, showcasing new innovative use cases that could reignite interest in the sector.

Forkast.Insights | What does it mean?

There has been a fundamental shift in the way NFT investors collect and trade. They’re finally looking for real value.

Where they aren’t finding value is in new mints, currently at all-time low NFT production levels. Those new NFT mints typically represent run of the mill profile picture collections, which can make creators enormous profits in an instant during a bull market. Today, you’ll be lucky to flip a new mint for what you paid.

After major projects like the CyberKongz’ Genkai, and NWay’s Wreck League failed to sell out their primary sale over the summer, creators hit the brakes on minting new collections.

Still, even with declining primary sales and plummeting value for NFTs on secondary markets, some NFT collections are proving resilient even today. Those collections offer more tangible value, like the Pudgy Penguins NFTs who offer royalties on toy sales to select NFT holders.

Similarly, the Winds of Yawanawa collection by Refik Anadol offers a more abstract, but equally attractive value as pure art. Refik’s art has been featured both on the Las Vegas Sphere, and now in the Museum of Modern Art as the first NFT creator to have his NFT backed digital art welcomed into their collection.

Even more value has been uncovered in new SoFi (social finance) platforms, which have themselves been a main contributor to the decline of the NFT markets. Total new users of the new Friend.tech platform have climbed to over 299,000 unique users, up from 130,000 on Sept. 1. Total locked value in the platform also rose from around 3,260 ETH to approximately 29,200 ETH over the month of September.

Innovation is for now mostly coming from outside NFTs. Until it returns to the non-fungible token market, expect to see September’s trend of all-time-low sales to continue well into October and beyond.


3. Monetary system’s impending sunset

Joe Lubin, chief executive of blockchain technology platform Consensys and a co-founder of Ethereum, spoke to Forkast during the recent Token2049 conference in Singapore. He discussed the parallels between today’s crypto bear market and the dotcom bubble of the late ’90s. Lubin attributes the current crypto downturn to similar waves of unbridled enthusiasm followed by market corrections. He predicted that a marriage between AI and blockchain could be the crypto industry’s route back to prominence.

  • Amid escalating global financial challenges, such as inflation and interest rate hikes, Lubin said that traditional monetary systems might be approaching their twilight.
  • Regulators in the U.S. are scrutinizing the crypto industry. Lubin sees this as a veiled effort to either “slow-roll” or outright suppress the budding industry.
  • Looking abroad, regions like Europe, Asia, and the Middle East are painting a contrasting picture. Those regions, he said, see decentralized tech as an equalizing force against the might of U.S. financial power.
  • A tech marriage is on the horizon, Lubin said. He highlighted the importance of weaving artificial intelligence into the fabric of blockchain technology — and vice versa.
  • There’s no need for society to be overly concerned about artificial intelligence, according to Lubin. He remains buoyant about AI’s potential, particularly in collaboration with decentralized protocols that prevent the concentration of AI control in a small number of hands.

Forkast.Insights | What does it mean?

Lubin is no AI doomer. He made that clear during his interview with Forkast. But while the blockchain mogul and Ethereum godparent outlined a lot of the good that can come from AI’s impending global takeover, he touched on some of its more dystopian aspects also.

Tech is never inherently bad, was the primary thrust of Lubin’s argument on artificial intelligence. The Consensys boss should know. He graduated from Princeton with a degree in computing and electrical science before kicking off his working life in the university’s robotics lab. So he enjoys a pretty solid grasp on the nascent field.

The only danger of artificial intelligence, he said, is if those now working on it allow its power to become entirely concentrated in a small number of hands — the bevy of private companies driving much of today’s AI advances. That would be “failure mode for humanity,” he said, without so much as a flinch.

The remedy for that, Lubin argued, is open source building and the incorporation of decentralized blockchain protocols. That way, the capabilities explored on the back of large language models (LLMs), generative pretrained transformers (GPTs) and the like will remain visible for all to see and make use of.

Your next open source coding tutor? Look no further than AI.

“We need to level up humanity in a big way,” Lubin said. “Our AI allies are going to get better and better at that.”

 

 

Source: https://forkast.news/israel-palestine-navigating-conflict-aid-blockchain/

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”.

j j j