Deepfake AI ‘gang’ drains $11M OKX account, Zipmax added by SEC: Asia Express

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

OKX trader lost $11 million due to deep AI fraud

On June 11, Crypto La La, operations manager at Quant Matter, said at the time of the incident, their account on crypto exchange OKX, worth $11 million, was hacked within 25 minutes without any email or two-step verification warning.

“I couldn't believe my eyes,” Crypto Lala wrote. “I have many years of experience in the cryptocurrency space, and this is the first time I've seen my assets stolen. To this day, I can't believe that all the money in my OKX account was stolen. My hands are still shaking, and I'm very angry, upset and sad.”

OKX founder Star Shu said the “coin-stealing group” deliberately uses deep fake AI to bypass victims' facial recognition software and gain direct access to their accounts. “Are all hacker groups so arrogant now? Records of communication between perpetrators, users, and victims of AI face-changing crimes consistently mislead victims into believing that OKX stole their money. The case is ongoing.

Xi Jinping praised the chief scientist of Conflux

Chinese President Xi Jinping In an open letter dated June 12, he praised Andrew Chi-Chi Yao, a prominent figure in blockchain technology and a professor at Tsinghua University. Yao is the Chief Scientist of Conflux Network, a popular layer-1 blockchain initiative in China.

Supported by the Shanghai Municipal People's Government, Conflux operates through a hybrid proof-of-work and proof-of-stake consensus mechanism through the Conflux Foundation, also known as the Shanghai Tree-Graph Blockchain Research Institute. It claims to be the only regulatory-compliant public blockchain in China, where cryptocurrencies are currently banned.

Yao has praised President Xi's commitment to science and technology since his return to China two decades ago. “You have turned your patriotism into a mission to serve the country,” Xi wrote. “Your dedication to Tsinghua University has resulted in significant achievements in teaching, learning and scientific research innovation. I offer my sincere greetings.”

Xi urged Yao to persevere in his efforts to develop new training models. They also emphasized that they will play Yao's role in enhancing China's educational and technological strength.

While China is hostile to crypto, President Xi himself appears to be a fan of distributed ledger technology. At the Shanghai Cooperation Organization (SCO) summit held last July 2023, he pointed out that central bank digital currencies (CBDC) could be used to expand bilateral trade. “The Chinese side proposes to expand the share of local currency settlement of SCO countries, expand cooperation on sovereign digital currency, and establish SCO development banks,” he said.

The Chinese-led CBDC bridge entered the MVP stage

A multilateral CBDC bridge involving the central banks of China, Thailand, the United Arab Emirates (UAE) and Hong Kong has reached the Minimum Viable Product (MVP) stage. Dubbed Embridge, the project is “dedicated to creating an efficient, low-cost, highly scalable and regulatory cross-border payment solution focused on central bank digital currency.”

The bridge uses distributed ledger technology developed by Chinese internet conglomerate Tencent. Two years ago, mBridge conducted a first-of-its-kind CBCC transaction involving four fiat currencies. Possible future improvements include local deployment of blockchain nodes and integration with commercial banks.

Last December, China confirmed a $400 million deal with the United Arab Emirates. “The renewal of the currency exchange agreement reflects the deepening relationship between the UAE and China and the UAE Central Bank's commitment to strengthening its partnership with China in finance, trade and investment,” the officials wrote. “China is the UAE's largest international trading partner, with oil trade between the two countries exceeding 264.2 billion dirhams by 2022.”

Zipmax license revoked by Thai SEC

Troubled Thai crypto exchange Zipmax has had its license revoked by the country's Securities and Exchange Commission.

“The decision was made because the financial situation of the company could harm the public and the management structure and staff are not appropriate and efficient and responsible business operations are not enough,” officials said.

“After the license is revoked, Zipmax will retain its status as a limited company with related rights, responsibilities and liabilities, including the possibility of legal action.”

Zipmax customers can still contact the company to retrieve their belongings. Meanwhile, the company has been ordered by Thailand's SEC to return the exposed digital currencies to its customers.

Recovery can be difficult. In the year On November 29, 2023, media reports Zipmax creditors will receive up to 3 cents on the dollar for first claims, with additional payments in the event of a recovery. Zipmax CEO Marcus Lim declined to confirm details of the restructuring plan, but said there were “mistakes” in the numbers quoted by reporters. Last April, the firm lost a $100 million buyout deal backed by V Ventures after withdrawing.

Microvisionchain launched a multi-million dollar grant program

MicrovisionChain (MVC), a Bitcoin DeFi developer based in Singapore and Macau, has launched a developer grant program called SPACE. Administered by MVCDAO, the program allows developers to apply individually or as a group for funding from a $1 million pool beginning in July, which will then cover 250,000 SPACE ($665,000) per quarter.

The grant process includes submission of project specifications, review, possible revisions, and final approval via committee approval or on-chain voting by the DAO. “Successful projects will receive awards divided into three parts in three months, ensuring continuous support and incentives,” the developers wrote.

In April, the protocol unveiled its first asset bridge in its efforts to build a fully functional BRC-20 decentralized exchange and exchange and token exchanges. “Wealth Bridge addresses the problem of transaction congestion in the Bitcoin ecosystem,” said Jason Kwok, MVC's Chief Operating Officer and Co-Founder.

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Zhiyuan Sun

Zhyuan Sun is a reporter at Cointelegraph, focusing on technology-related news. He has several years of experience writing for major financial media outlets such as The Motley Fool, Nasdaq.com and Seeking Alpha.