Korea’s Crypto Industry Condemns Exclusion Plan from Venture Firms List

Crypto exchanges and blockchain startups in South Korea are protesting against a recent legislative proposal by the government to exclude the industry from recognized venture businesses. In a proposal outlined by South Korea’s Ministry of SMEs and Startups this week, the government body revealed its intention to exclude the blockchain industry, including cryptocurrency exchanges, from

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South Korea Crypto Industry More Optimistic Than Ever Despite Bear Market

Throughout the past two months, investors in the local crypto market of South Korea have continuously expressed their optimism towards a drastic change in the regulatory landscape of crypto. Since early February, the crypto market has endured the third-worst correction in its history, experiencing a 78 percent decline in price. Despite the bear market, the … Continued

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South Korea Budgets a Trillion Won for Blockchain Tech in 2019

South Korea’s government has earmarked a 5 trillion won ($4.4 billion) budget toward its ‘Growth through Innovation’ investment program in eight critical sectors with a particular focus on blockchain and AI. In a meeting in Seoul on Monday, South Korea’s finance minister Kim Dong-yeon confirmed plans of a 5 trillion won investment toward its innovation … Continued

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ICO Regulations Round-Up: Fundraising Law, Jeju Island, Self-Directed IRAs

ICO Regulations Round-Up: Fundraising Law, Jeju Island, Self-Directed IRAs

In recent news pertaining to initial coin offerings (ICO) regulations, an EU report has advocated the regulation of ICOs according to crowdfunding legislation, the governor of Korea’s Jeju Island wants his jurisdiction to become a special economic zone regarding cryptocurrencies and blockchain, and the U.S. SEC has warned consumers regarding the risks of self-directed Individual Retirement Accounts that offer exposure to ICOs and cryptocurrencies.

Also Read: Markets Update: Bloody Crypto-Markets Suffer More Losses

EU Report Advocates Incorporating ICOs into Fundraising Laws

ICO Regulations Round-Up: Fundraising Law, Jeju Island, Self-Directed IRAsThe European Parliament’s Committee on Economic and Monetary Affairs has published a draft report proposing that initial coin offerings become regulated under crowdfunding legislation.

The report states: “This Regulation gives the opportunity to ICOs that want to prove their legitimacy to comply with the requirements of this regulation. Whilst this regulation may not provide the solution for regulating the ICO market, it takes a much-needed step towards imposing standards and protections in place for what is an excellent funding stream for tech start-ups. […] Crowdfunding service providers that wish to offer an ICO through their platform, should comply with specific additional requirements under this Regulation. However, private placements, ICOs raising in excess of 8,000,000 [euros] or ICOs that do not use a counterparty do not fall within the scope of those requirements.”

The report asserted that “at present initial coin offerings are operating in an unregulated space and consumers are at risk from fraudulent activity taking place in this market,” emphasizing that the regulation of ICOs would provide greater protection to investors.

Jeju Island Governor Seeks to Build ICO Hub

ICO Regulations Round-Up: Fundraising Law, Jeju Island, Self-Directed IRAsWon Hee-Ryong, the governor of Jeju Island, the largest island located off the coast of the Korean Peninsula, has requested that South Korea’s central government designate the island as a special economic zone for cryptocurrency and distributed ledger technology. The governor met with a number of policymakers and other high-ranking government officials on Wednesday, according to local media.

“Blockchain is an opportunity for Korea to take the lead in global internet platform [development], […] Blockchain can cut costs, provide stable transactions and essentially has the potential to become a game changer that could alter the ecosystem of the internet platform industry,” Won said. “For Korea to become a leader rather than a consumer of this new global industry, we need to quickly allow [the operation of] blockchain and cryptocurrency [firms].”

Emphasizing the need for a permissive stance regarding initial coin offerings, governor Won stated: “Entrepreneurs looking to innovate should be allowed to raise funds through cryptocurrency.”

SEC Warns of Self-Directed IRAs and ICOs

The United States Securities and Exchange Commission’s Office of Investor Education and Advocacy (OIEA) has published a report that seeks to warn investors of the potential “risks associated with self-directed Individual Retirement Accounts (self-directed IRAs)” in which initial coin offerings and cryptocurrencies are highlighted.

The report states that “Certain self-directed IRAs allow investment in so-called “digital assets,” which include crypto-currencies, coins, and tokens, such as those offered in so-called initial coin offerings (ICOs),” asserting that “Fraudsters may use the allure associated with ICOs and other digital assets to entice self-directed IRA investors with the promise of high returns. While it is possible that digital assets may provide fair and lawful investment opportunities, they may also be conducted without SEC registration or a valid exemption from registration, and may not provide complete or accurate information to aid investors in making informed decisions.“

Lori Schock, the director of the SEC’s OIEA, stated: “Now that some self-directed IRAs include digital assets — cryptocurrencies, coins and tokens, such as those offered in so-called initial coin offerings — we think it is important to alert investors about the potential risks and fraud involved with these kinds of investments that may not be registered.”

Do you think ICOs should be governed by crowdfunding legislation? Share your thoughts in the comments section below!


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Jeju Island Aims to Become an ICO-Friendly Blockchain Hub Inspite of South Korea Ban

South Korea’s Jeju island is proposing a plan to become a blockchain haven wherein initial coin offerings (ICOs) would be allowed in the autonomous province despite the ongoing ban in the mainland. According to a report by the JoongAng Daily on Monday, the governor of Jeju Island has formally proposed that the central government of … Continued

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South Korean Government to Promote Blockchain Training as Part of ‘4th Industrial Revolution’

South Korea’s Ministry of Science and ICT will promote the training of blockchain technology as part of an effort to prepare young people for what it calls the “Fourth Industrial Revolution.” Blockchain technology is included in courses that have recently been announced by the Ministry of Science and ICT. The Ministry of Science and ICT

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Korean Police Raid Firm in Fraud ICO Probe of $130 Billion Shipwreck

South Korean police have raided the office of the company that claims to have discovered the shipwreck of a Russian pre-World War 1 battleship carrying $130 billion in gold bars and coins. On Tuesday, the Seoul Metropolitan Police Agency has raided the offices of Shinil Group, a cryptocurrency startup looking to sell treasure from a … Continued

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Roger Ver Sent Governor of Jeju Island $100 in Bitcoin Cash, Did it Violate Local Policy?

Roger Ver, a prominent cryptocurrency investor who has backed some of the largest companies in the global crypto sector such as Blockchain, Zcash, BitPay, and Kraken, recently sent the governor of Jeju Island of South Korea $100 worth of bitcoin cash at a public event. Humorous Kim Yeong-Ran Rule Banter Over the weekend, Ver visited

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‘Treasure Ship’ ICO Dupes Investors – South Korea Asks Interpol for Help

'Treasure Ship' ICO Dupes Investors - South Korea Asks Interpol for Help

South Korean police have asked Interpol for help with an investigation into the fraudulent token sale of Shinil Gold Coins that were claimed to be backed by the “treasure” on the sunken Dmitrii Donskoi. Local media reported that the sale raised an estimated $53.5 million from about 124,000 investors.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

Treasure Ship Without Treasure

South Korean company Shinil Group announced on July 18 that it had discovered the shipwreck of Russian battleship Dmitrii Donskoi that was scuttled in 1905. The company also claimed at the time that about 200 tons of gold were found on board.

'Treasure Ship' ICO Dupes Investors - South Korea Asks Interpol for HelpThe firm subsequently backtracked on its treasure claims after the country’s financial watchdog, the Financial Supervisory Service (FSS), started investigating it for stock and initial coin offering (ICO) fraud, as news.Bitcoin.com previously reported.

However, before withdrawing its claims, the ICO presale had already taken place through a Singaporean company with the same name, Shinil Group, the Korea Herald described. Shinil Gold Coin tokens are supposed to be backed by the treasure on the Dmitrii Donskoi. Nikkei reported that a full-page advertisement was run in a South Korean newspaper last month, detailing:

The newspaper ad said Shinil, one or the other, would soon show video of the Donskoi wreck and, in the first half of 2019, distribute dividends worth 10% of the value of the treasure that it estimated at 150 trillion won ($133 billion) to holders of the Shinil Gold Coin cryptocurrency.

'Treasure Ship' ICO Dupes Investors - South Korea Asks Interpol for HelpCiting that the tokens were sold “to some 124,000 investors” during the presale, the Korea Herald elaborated, “Shinil was estimated to have raised funds worth almost 60 billion won [~$53.5 million] as of July 26 on the claim.”

The Singaporean Shinil Group claims that “the value of a coin was expected to rise to 10,000 won [~$9] compared to a presale price of 30-50 won [~$0.03-0.05], once it completed an initial coin offering on cryptocurrency exchanges,” the publication added.

Meanwhile, “experts have said imperial Russia would have no reason to load vast treasure on a ship that was going into battle and have also noted that there was a safer land route to Vladivostok, the treasure’s supposed final destination,” AFP reported.

Connection to Singaporean Company

As the FSS launched its investigation of the firm for financial fraud, Korean police also launched a criminal investigation.

'Treasure Ship' ICO Dupes Investors - South Korea Asks Interpol for HelpChoi Yong-seok, president of the Korean Shinil Group, insisted that “Shinil Group in Singapore had nothing to do with Shinil Group in South Korea.” However, the Korea Herald pointed out that “the two companies’ founders are siblings, and the Singapore firm has been selling virtual coins, reportedly with a promise of handsome returns in case treasure is salvaged from the ship.”

Police say “the founder of the Singaporean Shinil Group, surnamed Ryu, was also wanted in connection with fraud allegations dating back to 2014” and they had already requested Interpol’s assistance with him, AFP noted. “Police has been hunting for Ryu since 2014, when he fled the country during a separate investigation…We are asking police in any relevant country to help locate and repatriate him at the earliest possible date.”

Officials of the Korean Shinil Group, including Choi, “have had travel bans imposed on them,” the news outlet detailed:

Police in Seoul requested an international arrest warrant for the founder of a Singapore-based firm Thursday after launching an investigation into the company and a South Korean startup over false claims of discovering a long-lost Russian ‘treasure ship’.

What do you think of this treasure ship scheme? Let us know in the comments section below.


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The Daily: Cars and Pizzas for Crypto in Russia, Crypto Valley in South Korea

The Daily: Cars and Pizzas for Crypto in Russia, Crypto Valley in South Korea

The wide adoption of cryptocurrencies in Russia has been put on hold after the State Duma postponed the final reading of three crypto bills for its fall session. Nevertheless, Russian companies are already planning to introduce crypto payments as soon as the regulations are in place. Among them, a major car dealer and an international pizza chain. Also in The Daily, the governor of Jeju has received support from Bitcoin.com for his efforts to create a Crypto Valley on the island. And while the South Korean province hopes to become a crypto and blockchain hub in Asia, major European banks have decided to base their blockchain initiative in Dublin.   

Also read: Hackers in High Demand, China Hires Cryptographer

Avtospetscenter and Papa John’s Prepare for Crypto Payments

With Russian parliamentarians taking vacation without keeping Putin’s July deadline for adopting comprehensive regulations for the country’s crypto space, Russian companies are left with only one option – to plan for crypto adoption after lawmakers officially recognize cryptocurrencies this fall. Two major businesses have announced their readiness to take advantage of crypto payments once they are legalized by authorities in Moscow.

The Daily: Cars and Pizzas for Crypto in Russia, Crypto Valley in South KoreaOne of Russia’s major car dealers, Avtospetscenter (ASC), has admitted it intends to start selling automobiles for digital money. “We are thinking of selling cars for cryptocurrency. The idea is under development. If there are no obstacles in the legislation, ASC will start selling cars and providing crypto services by 2020 – 2021,” Andrey Turkin, general manager of ASC’s subsidiary Audi Center Taganka, said quoted by Bits Media.

Soon, Russians will probably be able to order pizza with bitcoin as well. “Cryptocurrency has every chance of being directly applied in our business. I think, in the future, you’ll be able to buy our pizzas with bitcoin. We have the solutions ready, but for now we are just waiting for the right moment to start it all,” Christopher Wynne, Papa John’s President for Russia, CIS and Poland, revealed in an interview with TASS.

Governor of Jeju With Bitcoin.com Wallet

Won Hee-ryong, the governor of Jeju in South Korea, has presented some ambitious plans for his province and they involve cryptocurrency adoption with the help of Bitcoin.com and Bitcoin Cash (BCH). Won wants to turn Jeju Island into Korea’s Crypto Valley and has already made proposals for that to the country’s National Assembly.

The Daily: Cars and Pizzas for Crypto in Russia, Crypto Valley in South KoreaDuring the Huobi Carnival in Seoul this week, Won Hee-ryong met with Bitcoin.com CEO Roger Ver who promised to contribute to the realization of the project and support the efforts of the governor. Prior to their conversation, Mr. Ver showed Mr. Won how to download and install the Bitcoin.com wallet on his smartphone, Blockinpress reported.

The opening of Jeju to various projects from around the world will help the development of the crypto and blockchain technology, Roger Ver noted. He also said that people from the crypto space will discover the island as a holiday destination. “I will support Jeju to become a prosperous blockchain hub,” Mr. Ver emphasized and revealed he is planning to visit the island next month.

The Daily: Cars and Pizzas for Crypto in Russia, Crypto Valley in South KoreaWon Hee-ryong accepted the offered help and added: “As Mr. Roger Ver said, Jeju is an international tourist destination with a good environment to become a blockchain hub.” He also noted that the island has a special, autonomous status that can help solve regulatory issues which haven’t been solved at national level.

Top Euro Banks Choose Dublin for Their Blockchain Initiative

An alliance of nine leading European banks has chosen the Irish capital as a base for their blockchain initiative, local media reported. The We.trade group, formerly Digital Trade Chain, includes major financial institutions from the Old Continent such as Deutsche Bank, HSBC and Santander. The consortium was founded in 2017 to explore and develop blockchain technologies for carrying out transactions between banks and their clients. The platform is currently used for trades among 11 European countries.

After a period of development and testing, the participating banks are now working to onboard more clients, revealed We.trade’s Chief Operating Officer, Roberto Mancone, former head of the disruptive technologies division of Deutsche Bank. “It’s no longer a proof of concept, it’s no longer an experiment, the platform is now made available to the clients,” he said, adding that they can find counterparts in other countries and start trading using the platform to create smart contracts, finance invoices or make payments.

Days after We.trade’s announcement, a European blockchain body expressed concerns over the lack of legal clarity in regards to the implementation of blockchain technologies and the application of EU’s General Data Protection Regulation law (GDPR). The EU Blockchain Observatory and Forum warned that the new rules which went into effect recently are actually threatening innovation in the space.

“As long as the legal framework around personal data and blockchain remains unclear, entrepreneurs and those designing and building blockchain-based platforms and applications in Europe face massive uncertainty. That can put a brake on innovation,” the organization said in a report titled “Blockchain Innovation in Europe”. One of the main concerns stems from the incompatibility between the right of individuals under GDPR to request their personal data to be deleted and the immutability of data stored on a blockchain.

What are your thoughts on today’s news tidbits? Tell us in the comments section below.


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Korea’s Biggest Crypto Exchange UPbit Comes Out Clean in Audit after Raid

UPbit, currently the biggest crypto exchange in South Korea, came out clean in an audit report which proved the exchange had 100 percent of the amount its balance sheet demonstrated. Police Raid in May On May 11, as CCN reported, UPbit was raided by local authorities under the suspicion of balance sheet manipulation and inflated … Continued

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Binance CEO Changpeng Zhao: With Tether ‘Concern is Always There’

Binance CEO Changpeng Zhao: With Tether 'Concern is Always There'

During a recent conference in South Korea, Binance CEO Changpeng Zhao responded to questions about the company’s relationship with controversial stablecoin Tether. He acknowledged that “concern is always there,” according to regional reporting. Binance is one of the largest holders of Tether.

Also read: Bitcoiners Hope to Have a Friend in Top US Regulator Jay Clayton

Binance CEO Voices Concern Over Tether

According to Anca Faget of Romania-based Coindoo, the CEO of Binance, Changpeng Zhao, responded to questions about the company’s relationship with controversial stablecoin Tether. One question came from Ran Neu-Ner who asked about the impact a Tether crash would have on Binance.

Binance CEO Changpeng Zhao: With Tether 'Concern is Always There'
Mr. Zhao

Mr. Zhao answered, “We have seen fiat currencies go down in history a lot. Probably more times than they have been in cryptocurrencies. So yes, the concern is always there and that’s also why we’re listing other stable coins as well, so we actively promote other stable coins including True USD and others.”

Binance launched in the summer of last year with an initial coin offering that raised around $15 million. It’s a cryptocurrency exchange, catering to a multi-language, international clientele. This year has been a busy one for the exchange. On its way to a very ambitious goal of earning $1 billion this year, Binance invested in a Maltese bank, is attempting to conquer the South Korean market, and recently teamed up with Libra Credit.

Binance CEO Changpeng Zhao: With Tether 'Concern is Always There'

Tether and Bitfinex 

Mr. Neu-Her also asked about the connection between Tether and Bitfinex. Many in the ecosystem have long accused both of bitcoin price manipulation, with some actually attributing the entire price run-up of 2017 to Tether’s inflation (another study, however, came to the opposite conclusion).

“I haven’t personally seen their bank accounts,” Mr. Zhao assured, “but from a logical point of view they have so many profits from their regular exchange business, they don’t need to do anything crazy about the Tethering. I think the reason they cannot release their bank account details is because if they release whichever bank they’re using, then the bank account gets shut down,” the CEO said at a Korea Blockchain event.

Binance CEO Changpeng Zhao: With Tether 'Concern is Always There'

Ironically, accusations against Tether have slowed toward the middle of this year. When yet another study suggests a Tether collusion, this time between it and Kraken, the exchange took to its blog and blasted journalists whom it felt understood little how its business works. Last month Tether brought in an establishment figure to head its compliance division, perhaps in an effort to assuage future fears.

How important is Tether to the ecosystem? Let us know in the comments section below.


Images via Pixabay, Binance, and Tether.


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