China’s ‘Dots Run’ Crypto Scam, Pork Butchers Kill Children: Asia Express

Asia's weekly news roundup reviews the industry's most important developments.

Chinese investors have been duped by dot runs and crypto laundering schemes.

A new type of cryptocurrency scam is on the rise in China, with locals losing money in a scheme known as “point running,” according to a warning posted by the Public Security Bureau on September 10.

The term “point running” refers to the practice of moving crypto through different accounts. Often new to digital assets, victims are told that they are processing transactions and earning rewards or commissions by transferring these crypto-currencies.

Typically, this scam is sold as a side hustle, where participants move crypto between manual accounts, under the false promise that these transactions will generate profits. In fact, victims may unwittingly act as money mules for illegal activities.

More recent versions of scams trick victims into depositing cryptocurrency directly into platforms that claim to host “point runs,” making the process seem effortless. Victims are attracted by small initial returns, encouraging them to invest more.

In the case reported by the Public Security Bureau, a local resident named Wang was introduced to the WeChat group by a friend. The offer was simple: invest in USDT (“U” coins) and watch the money grow. After installing an app, Wang initially invested 8,000 yuan (about $1,125), then increased his investment after seeing small returns. In August, he invested more than 300,000 yuan ($42,112). When Wang tried to withdraw the money later that month, he received a screenshot confirming the transaction, but the money never arrived and his “U” balance disappeared from the app.

Wang was paid 2,000 yuan ($280) in “commission” and ultimately lost 280,000 yuan ($39,305).

Officials have warned that these scams are becoming more common as many locals ban mining and trading of digital assets in China.

Victims are often lured by promises of high income with little effort, but authorities say these schemes are often linked to money laundering in addition to causing financial losses, making the case even more complicated for those involved.

Hacked Indodax launched an Instagram damage control campaign

After losing $22 million in a hack on September 11, Indodex has launched a promotional campaign on its Instagram account to ease customer fears.

The campaign said it was giving away 3 million rupiah (about $200) every hour to three winners chosen from among those who responded to messages posted by the exchange and CEO Oscar Dharmawan. He said.

According to security firm SlowMist, customers are now awaiting the results of an investigation into a $22 million exploit targeting Bitcoin, TRX, POL and other ERC-20 tokens.

The Indox hack comes two months after neighboring India's major exchange, WazirX, suffered one of the biggest heists of the year at $230 million.

WazirX, which is managed by Singapore-based Zeti Pete and its Indian subsidiary Zanmay India, sought a six-month relief from the Singapore High Court in late August. This move allows the exchange to reorganize the debt, and temporarily protect it from creditor claims.

Like Wazir X, North Korea's state-run hacking group Alazar has been accused of carrying out a cyberattack on Indodex.

During the annual Seoul Defense Dialogue held on September 11, South Korean Prime Minister Han Dak-soo pointed to North Korea's crypto-theft for nuclear development as a global security threat.

In his speech, Han announced that the South Korean government is establishing “core strategic technologies” to prevent such cyber attacks.

Human trafficking linked to pork farming scams in Southeast Asia

Pork slaughter fraud is on the rise in East Asia, according to crypto compliance and research firm AMLBot.

Among the company's investigations in August, pork scams, romance scams in which fraudsters gradually gain a victim's trust and use their emotions to extract money, lost $3.2 million to victims, up from $1 million in July.

“According to our investigations and findings, large-scale pork butchering is currently concentrated around Cambodia, Myanmar and the Philippines, among which Cambodian syndicates are being operated by Chinese crime lords,” AMLBbot said in a statement shared with the magazine.

They add that there is a human trafficking angle where children are abducted from India and Nepal and transported to compounds in Laos and used to blackmail the victims.

In previous cases, criminal proceeds were often sold on crypto exchanges, but currently, they are monetized through Huione Pay, according to AMLBot.

Huione Pay is a foreign exchange business owned by Huione Group, which also operates the multi-billion dollar marketplace Huione Guarantee.

In July, crypto forensics firm Elliptic reported that Huione Guarantee has evolved into an online marketplace that has become a favorite among pork scammers in Southeast Asia. Traders on the platform have traded more than $11 billion.

AMLBot's August investigation is consistent with the findings of forensics firm Chainalysis.

Chainalysis recently told Cointelegraph that fraudsters are increasingly moving from sophisticated Ponzi schemes to quick schemes, such as pig farming, that target individuals on social media.

The Philippine Science High School is set to adopt blockchain to manage student records.

A top public high school in the Philippines is using blockchain technology to manage and verify its students' academic records, local broadcaster ABS-CBN reported.

The Philippine Science High School (PISA) has described how blockchain technology can streamline the process of accessing and managing student information, which normally requires students and parents to visit schools in person. By implementing blockchain, the new system removes this bottleneck, allowing records to be accessed securely and online. This approach ensures the integrity and accuracy of academic documents for fast and efficient service.

The initiative is being developed by the Department of Science and Technology and aims to demonstrate how blockchain can be used beyond cryptocurrencies to unlock its potential in public sector applications.

Pisay's digital certificate is set for testing in late 2024, with a wider rollout planned for 2025.

A number of academic institutions have explored blockchain-based credentials to enhance the security and authenticity of academic records. One of the first examples was in 2017 when the Massachusetts Institute of Technology launched the Blockserts initiative. This initiative allows graduates to receive diplomas in digital format secured by blockchain technology.

Also in 2017, Australia's University of Melbourne began issuing blockchain-based micro-credentials to employers to verify student success.

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John Yun

Yohan Yun is a multimedia journalist who has been reporting on blockchain since 2017. He has contributed to the crypto media outlet Forkast as an editor and covered Asian tech stories as an assistant reporter for Bloomberg BNA and Forbes. He spends his free time cooking and experimenting with new recipes.