Blog Archives - dongwonkwak

Korean virtual asset exchange also cut off Ripple (XRP). Coredax to stop trading.

12/30/2020

While large overseas virtual asset exchanges such as Coinbase (www.coinbase.com) and OKCoin (www.okcoin.com) have stopped trading Ripple (XRP), a similar move has begun on Korean virtual asset exchanges.

Coredax (www.coredax.com), a Korean virtual asset exchange, announced on the 30th that it will completely suspend XRP transactions. The transaction suspension is on January 15, 2021, and members must withdraw all XRP in the exchange by February 1.

The reason is the lawsuit filed by the Securities and Exchange Commission (SEC) against Ripple. Foreign exchanges have also stopped trading XRP for the same reason.

The US Securities and Exchange Commission (SEC) filed a lawsuit against the issuer, Ripple, on the 22nd, seeing XRP as “unregistered securities”. Securities distribution requires compliance with federal securities laws, but the SEC claims that Ripple sold XRP without any action under the securities laws.

If XRP is defined as securities, XRP cannot be traded on general virtual asset exchanges in the United States. This is because most exchanges, including Coinbase, do not have a stock trading license. As a result, Bitstamp, one of the major exchanges, stopped trading XRP by US customers early on, and Coinbase stopped trading afterwards.

It is predicted that not only US exchanges but also non-US exchanges such as OKCoin will stop trading. Virtual asset influencer 'NekoZ' said, “All exchanges with US customers (not just US exchanges) will need to delist XRP. The lawsuit is a big issue.”

However, Korean virtual asset exchanges have very few US customers. This is because most exchanges have some restrictions on the use of foreign customers due to taxation issues.

Regardless of the number of customers, Coredax is in a position to proactively respond to risks. Yo-song Lim, CEO of Coredax, said, "SEC's movement has a symbolism that can have a great influence on the virtual asset trend in the future. We prepare for more than what is required by current Korean law, We are managing it in advance.”

Virtual Asset Industry ahead of the Enforcement of the Special Financial Information Act, Domestic VS Overseas 'Temperature Difference'

12/29/2020

With the revised Specific Financial Information Act (SFIA) that regulates virtual asset providers (VASP) coming into effect in March, there is a temperature difference between Korean virtual asset services and overseas services.

With the recent increase in Bitcoin (BTC) prices, overseas services are expanding their business, while services that disappear in Korea are appearing one by one.

◆Overseas exchanges that share order books with large exchanges... Domestic halted

The representative SFIA provision that caused the service interruption is “prohibition of sharing order books”. The Enforcement Decree of the SFIA announced last month contained the content that “by alliances with other virtual asset business operators, the act of allowing customers to trade virtual assets with customers of other virtual asset business entities is prohibited”. This means that order book sharing is prohibited.

Until now, some exchanges have shared order books with large overseas exchanges to secure insufficient liquidity. Binance KR and Huobi Korea, which are headquartered overseas, shared an order book with Binance and Huobi, respectively, and Aprobit also shared with Bitfinex.

However, with a ban on order book sharing, Binance KR decided to close its business. This is because the transaction volume is expected to be low if sharing is stopped. Aprobit also announced on the 28th that it will stop sharing the order book with Bitfinex.

Meanwhile, exchanges that share order books with Binance have begun to appear overseas. On the 23rd, Mandala (www.mandala.exchange), an exchange based on Binance Cloud, was launched.

Binance Cloud is a cloud that provides Binance's transaction liquidity and security system, allowing you to create an exchange based on it. The first exchange based on Binance Cloud was Binance KR, but Binance KR was closed and other exchanges started using Binance Cloud.

Accordingly, the possibility of Korean domestic investors escaping overseas has also increased. This is because foreign exchanges provide more liquidity.

Hwang Soon-ho, head of Dounamu External Cooperation Team, who attended a public hearing on the enforcement ordinance of the Special Special Law earlier this month, said, “If (order book) alliance is prohibited, investors will go to foreign exchanges.” I did.

◆De-Fi, which has been formed from overseas, is closed in Korea

The situation is similar for decentralized finance (De-fi) services. Overseas services poured out as a “de-fi boom” broke out throughout the market this year. On the other hand, 'Trinito' of Dunamu DXM, which was the first domestic De-Fi service, has ended.

DXM, a subsidiary of Dunamu, announced on the 23rd that it will end the Trinito service, a virtual asset deposit and loan service. All other functions except withdrawal and redemption have been terminated, and members must withdraw virtual assets by January 29, 2021.

Unlike exchanges, De-Fi services are not directly regulated by the SFIA. Therefore, Trinito also did not have a direct impact on the termination of operations. However, Dunamu explained that Trinito's profitability and service scalability were insufficient.

There is also a regulatory risk behind the difficult service expansion. Overseas De-Fi services have increased their profits by issuing their own tokens and giving token rewards to members. On the other hand, in Korea, it is difficult to take this method, the position of industry insiders.

Yoo Ju-Yong, DXM CSO (Chief Strategy Officer), also at the'Upbit Developers Conference (UDC 2020)' held earlier this month, saying, “There is uncertainty due to regulations in Korea. As the technology is not lagging behind overseas, if regulatory risks are resolved, Various De-Fi services will come out.”

DXM's services such as Upbit's staking service will continue to operate. An official from Dunamu said, “Other services of DXM will remain the same,” and “We are thinking about devising a better service.”

Korean government striving to industrialize blockchain.. Full support for fintech convergence technology

12/28/2020

The Korean government supports blockchain companies to enter the global market and establishes a dedicated organization in charge of establishing standards for blockchain services.

In addition, the government's support, which has been distinguishing between fintech and blockchain, will expand to the blockchain-fintech convergence industry, and improve the use of blockchain technology.

■KISA, helping to industrialize blockchain

According to related industries on the 28th, the Korea Internet & Security Agency (KISA) is recruiting for the service of'Establishing an Information Strategy Plan (ISP) for Building Blockchain and Fintech Technology Distribution Center' by the 30th. The successful bidders will take on the role of establishing a basic framework for actual business promotion, such as analyzing the environment and current status and establishing strategies for building the center by March next year.

KISA plans to expand the scope of support of the KISA Fintech Technology Support Center through the Blockchain Fintech Technology Spreading Center. Currently, KISA is planning to integrate and support the work divided into blockchain and fintech so that the fintech industry can use blockchain technology to create synergy.

The Blockchain Fintech Technology Dissemination Center is largely organized into four areas: △internalization of service security △support for service commercialization △training of experts and △demonstration test lab construction. In the technology diffusion center, the technology diffusion center takes the lead in items that are prominent in the current blockchain industry, such as Decentralized Identifier (DID), which is one of the leading popularization services based on blockchain technology, and decentralized finance (De-Fi) services based on blockchain that has exploded this year.

■Blockchain company IPO support

According to the announcement of the establishment of the Information Strategy Plan (ISP) disclosed by KISA, the 'Blockchain Fintech Technology Spreading Center' is a blockchain company specializing in technology evaluation for the listing of special exceptions, including consulting for blockchain companies and IPO. It plans to support commercialization of startups.

It also supports the advancement of DID (Decentralized Identifier) technology and the spread of services. KISA plans to support technologies and policies in both directions so that distributed authentication services using blockchain can resonate with users and settle in the market.

KISA said, "It means that we will not only look at the blockchain within fintech, but will support it to build the industrial foundation with our own technology that has its own value. Through the diffusion center, companies can actively use blockchain technology. We will provide a test environment that is in place."

On the other hand, the actual construction time of the blockchain and fintech technology diffusion center is expected to be around 2022. When the ISP project order-winning company submits a strategic plan for the technology diffusion center by March next year, KISA plans to review it and begin construction.

Upcoming Specific Financial Information Act impacts on Korean virtual assets industry.

12/28/2020

Aprobit (www.aprobit.com) stops sharing order book with Bitfinex (www.bitfinex.com) "To comply with SFIA (Specific Financial Information Act)."

Aprobit, a Korean virtual asset exchange, stops sharing order books with foreign exchanges Bitfinex. This is to comply with the revised Specific Financial Information Act, which will take effect in March next year.

The Enforcement Decree of the SFIA announced last month contained the content that “by alliances with other virtual asset business operators, the act of allowing customers to trade virtual assets with customers of other virtual asset business entities is prohibited”. This means that order book sharing is prohibited.

The Korean Financial Information Analysis Institute (KoFIU) announced that it has prohibited the sharing of order books in order to achieve the purpose of the Special Money Laundering Act. The reason is that if you share your books with overseas exchanges, you cannot properly understand the customers of virtual asset business operators (overseas exchanges) who have not reported.

Accordingly, Aprobit also decided to operate independently. In the meantime, Aprobit has operated the won market by itself, and other markets such as BTC market have been operated in conjunction with Bitfinex, but will stop linking in accordance with regulations. Currently, both BTC and USD market transactions have ended.

Aprobit said that although liquidity and transaction volume are expected to decrease due to the suspension of order book sharing, it will create an independent trading environment through other businesses. It also said that the partnership with Bitfinex will continue.

Aprobit CEO Kim Byeong-joon said, “Many exchanges will suffer realistic damage such as liquidity supply burden and transaction volume reduction due to the interruption of order book sharing.” It was not so I decided to stop sharing.” He added, “We will create a unique trading environment for Aprobit in the new year by following the guidelines for reporting virtual asset business operators under the SFIA.”

There are still cases where domestic exchanges are burdened by the prohibition of sharing the order book. On the 24th, Binance KR, which shared the order book with Binance headquarters, announced the suspension of the exchange. It is known that the company decided to close the business due to poor transaction volume when the order book sharing was stopped.

Virtual asset trading is entering the institutional sphere, but there are more and more regulations accordingly. So the industry's response is paying attention.

Coinplug's DID real name verification service was selected as an innovative financial service by Korea Financial Services Commission.

12/23/2020

The real name verification service using the decentralized identity authentication (DID) of the blockchain company Coinplug (www.coinplug.com) was selected as an innovative financial service by the Financial Services Commission.

According to Coinplug on the 23rd, the service is a digital real name verification service using Coinplug's DID platform 'MyKeypin'. In addition to blockchain DID technology, it has also been developed for ease of use by introducing artificial intelligence-based facial recognition technology.

The Financial Services Commission has given special cases so that the use of facial recognition technology that contrasts the photograph of the real name verification card and the face photographed screen instead of a video call for non-face-to-face real name verification. In addition, when presenting a digital real name verification certificate stored in a customer's mobile phone, it was allowed to acknowledge that a non-face-to-face real name verification was performed.

Therefore, users can encrypt and store the certificate issued by DID on their personal mobile terminal, and then selectively present information only when necessary. Through DID technology, the 'self-sovereign identity verification' is realized in which users have sovereignty over their information.

A Coinplug official said, "We expect to be able to further develop the DID business area by receiving temporary permission for the financial sector business by designating this innovative financial service."

It is expected that various decentralized identity authentication (DID) related services will be provided in the future.

How To Use Blockchain in Korea for Pandemic Era

12/23/2020

Blockchain is designed so that one data is simultaneously recorded on multiple distributed servers, and can only be accessed and entered through a verification and consensus system between them. Through this, it is possible to prevent thorough activation and manipulation of records by linking all vaccine-related data to the blockchain from the beginning of production and distribution.

In addition, in the case of vaccines, as many people as possible must be vaccinated normally, the effect of collective immunity can be expected, so transparency in distribution management should be guaranteed more than ever. Incidentally, the introduction of blockchain into the distribution network allows multiple verification procedures to be handled by software. This also has the advantage of preventing mistakes caused by direct human verification and saving related labor costs.

In addition to distribution, blockchain can help manage and track vaccination records. Experts predict that in 2021, as the distribution of the Covid19 vaccine will accelerate, proving 'whether or not you have been vaccinated' can be a social issue.

Even at this time, if a public system that can be easily carried by mobile than a simple paper certificate that can be forged and can transparently prove identity authentication and vaccination record management through a block chain is implemented, problems arising from such disputes can be minimized.

Also, unlike in the past, even if it is assumed that there is a problem in the future with a vaccine that has started distribution without going through sufficient procedures, using the smart contract system of the blockchain will find the vaccine inoculum in the most accurate and quickest time and notify the problem Will be possible. As such, blockchain is expected to become a technology that contributes to reducing unnecessary social costs in each field in the post-pandemic era beyond the with pandemic era.

Will DEX (Decentralized Exchange) be introduced in Korea?

12/17/2020

Unlike centralized exchanges where hacking situations still occur, it is an exchange that allows users to directly trade without intermediaries. It is a long-established DeFi (Decentralized Finance) model that extends from Etherdelta or IDEX, which was the cradle of ICOs at the time of the 2017 ICO craze, to XX Swap (xxSWAP), which heated up 2020. In particular, UniSwap has grown so rapidly that it surpassed Coinbase, the largest virtual asset exchange in the U.S. by volume. The characteristics of decentralized exchanges that have appeared recently are that they all use an Automated Market Maker (AMM) based on a liquidity pool.

Serum (SRM), a decentralized virtual asset exchange with its strengths in fast transaction processing speed and low commissions, launched its official service in 2020, pointing to Korea as a major service area to secure domestic users.

While interest in Decentralized Financial (DeFi) is rapidly increasing, it is noteworthy whether serum that emphasizes convenient usability can expand virtual asset trading services in the domestic market.

Filecoin (FIL), which had a lot of talk and a lot of deception, listed on Korean virtual asset exchanges one after another

12/16/2020

Filecoin (FIL), which has been controversial over various suspicions such as multi-level sale of miners and dumping, is listed one after another by Korean virtual asset exchanges. It is pointed out that rather than investing intently to see the effect of a new listing, related issues should also be identified.

◆Filecoin, how much talk was there?

Filecoin is a project to implement a decentralized file sharing system using IPFS technology. IPFS is a protocol for storing data in a distributed file system and sharing it over the Internet. Virtual asset FIL is a token used within the file sharing platform.

Filecoin, which conducted an ICO (Virtual Asset Disclosure) in 2017, raised an investment of over $275 million (about 280 billion Korean won) in one month. After that, a project that raised a larger amount came out, but at the time of the ICO, Filecoin was the ICO project with the most funds in the world. As a result, Filecoin is expected to speed up its business.

Nevertheless, the launch of Filecoin's mainnet was delayed several times. The mainnet, which was originally scheduled to be released in mid-2019, was released last October after several delays. In the meantime, complaints from investors steadily came out, and suspicion of scam (fraud) was raised.

Controversy arose in Korea as well. This is because a multi-stage mining machine sold long before the mainnet launch. Domestic multi-tier companies have been selling Filecoin miners through YouTube and online communities, claiming that they can recover their investment within a few months by buying a miner. Some of them have also spread multi-level sales that pay more rewards for recommending the sale of miners.

Afterwards, Chinese miners expressed dissatisfaction as Filecoin applied a ‘advance collateral system’ to mining prior to the launch of the mainnet. Due to the policy put forward by Filecoin, miners had to prepare 350 FIL as collateral in advance, but it was virtually impossible to obtain the amount.

As a result, FIL unlocked 1.5 million coins, much more than the 500,000 planned to be distributed on the first day when FIL launched the mainnet last October. This is the reason for the dumping controversy.

At the time, CEO Justin Sun Tron said, “1.5 million FIL was dumped without the consent of the community.” “All executives and employees of FIL, miners, investors, and everyone must follow the stated rules. Do you really think it's okay to dump like this?”

◆Listed on Korean virtual asset exchanges such as Upbit and Korbit… Need to review when investing

Despite a number of controversies, the popularity of FIL has increased since the mainnet launch. Accordingly, large domestic exchanges such as Upbit and Korbit also listed FIL one after another. It is pointed out that when investing, both the prospects and controversies of the stock should be reviewed.

Upbit listed FIL around 9 pm on the 9th. Until now, most of Upbit's listing took place during the daytime, so it was raised that upbit was pushing for a late listing with Coinbase's Filecoin listing in mind. It is expected to pump prices by listing several hours ahead. Coinbase announced the listing of FIL on the 9th and then proceeded to list at around 2 am on the 10th in Korea time.

Regarding this, an official of Upbit said, “We didn't have Coinbase listing in mind,” and “We prepared for listing on the afternoon of the day, but it took an unexpectedly long time in the process of communicating with the project regarding the integration of the FIL mainnet. It will be listed at 21:00 immediately after completing all the processes.”

When asked if the controversy was reviewed at the time of listing, he replied, "It was listed according to the same general listing screening criteria as other stocks."

Korbit listed Filecoin for the first time in Korea on the 19th of last month. In addition, he said that he would encourage file coin transactions by linking with Korbit's quiz reward program, 'Piggy Bank'.

At the time, Sejin Oh, CEO of Korbit, revealed the background of the listing, saying, "The fact that data can be efficiently stored and publicly verified using Filecoin will help the development of blockchain technology."

Korean Blockchain technology development has become easier and use cases have increased.

12/16/2020

In 2020, the Korean blockchain industry had a year to lower the barriers to entry. This is the impact of the release of several blockchain clouds and development tools.

As development became easier and the industry matured, many practical use cases appeared. In Korea, blockchain-based decentralized identity authentication (DID) has greatly expanded its use, and DApps (Decentralized Applications) with a large increase in the number of users have also appeared.

◆ Introducing Blockchain Without Experts = Blockchain is a technology that can be introduced in an infinite number of fields. Blockchain technology can be used by all companies that want to prevent forgery or alteration of data and secure service transparency. However, there have been barriers to entry. As it is a new technology, it is not easy to find specialized block chain developers.

This year, blockchain technology companies have focused on lowering this barrier to entry. Blockchain services have been increased by allowing technology to be introduced using cloud and development tools, even without blockchain experts.

In particular, companies that developed blockchain platforms stood out. A blockchain platform can be marketable only when there are many services developed based on the platform. If companies release their own development tools, it helps to gather services.

Ground X, a blockchain technology subsidiary of Kakao, launched a cloud-based service-type blockchain (BaaS, Blockchain-as-a-Service) 'KAS (Klaytn API Service)' in October. The intention is to allow anyone to develop services based on Ground X's blockchain platform, Clayton. Companies that want to develop services can use KAS to provide functions on the blockchain in the form of APIs.

Lambda 256's Luniverse, the original BaaS, also focused on lowering the barriers to entry. By providing a sidechain connected to the Luniverse blockchain, customers can create services independently while using the sidechain in the form of a private blockchain. In July, Luniverse also launched a shared blockchain that allows multiple companies to share this sidechain. The intention is to further reduce development costs. In this way, Luniverse attracted more than 1,200 corporate customers as of October.

Line Blockchain of NAVER (www.naver.com)'s subsidiary Line also reinforced its progress as a platform by releasing the development tool 'Line Blockchain Developer'. In October, it announced eight companies that introduced LINE Blockchain using development tools.

◆ Increasing use cases centered on DID… Blockchain that has become commonplace = As more and more companies introduce blockchain to services, practical use cases have also increased. For example, the karaoke DApp “Something” surpassed 500,000 downloads and 330,000 users as of November, as more users visited “home karaoke” due to the spread of Corona 19. Something, developed based on Clayton, recently decided to develop a DApp version of the LINE Blockchain. The intention is to target the Japanese market established by Line.

The increase in use cases was even more pronounced in the DID field. DID means verifying one's identity without a central authority through blockchain technology. Users can directly store the issued DID authentication in their own device rather than other organizations. After that, whenever authentication is required, it only needs to provide the necessary information to prove your identity.

In Korea, an alliance has been established in the form of blockchain companies creating DID platforms, and member companies seeking to introduce them to participate. Currently, the domestic DID alliance is ▲'My ID Alliance' led by Blockchain technology company Iconloop ▲'Initial DID Alliance' led by SK Telecom and joined by the rest of the telecommunication companies ▲'MyKeypin Alliance' led by Blockchain Technology Company Coinplug ▲ There are four such as 'DID Alliance', which is centered on security company Raon Secure.

From the end of last year to the first half of this year, the alliances focused on attracting member companies, but from the second half of this year, they focused on creating practical use cases. ICONLOOP applied MyID to check visitors for the prevention of Corona 19 in Jeju Island. While introducing MyID to Shinhan Bank's mobile application SOL, DID technology was applied to banknotes, and MyID was also introduced to the certification service of people in the recruitment platform.

The coin plug of the MyKeepin Alliance also applied DID technology to the pass of the Busan Startup Support Center. In addition, in cooperation with HP Retail, an unmanned convenience store company, DID was also used for access to unmanned convenience stores.

Raon Secure introduced its own DID platform 'OmniOne' to the Ministry of Public Administration and Security's mobile civil service card. In addition, the DID-based civil petition system of the Military Manpower Administration and the DID-based Domin card issuance project of the Gyeongnam Provincial Office are being conducted based on OmniOne.

With the spread of Corona 19, non-face-to-face authentication and the abolition of public certificates, DID is expected to gain more attention. Jin-young Oh, head of the KISA Blockchain Promotion Team, who recently held the DID standardization forum, said, "As the non-face-to-face society has expanded recently with Corona 19, securing the reliability of data has become important, and DID is a customized technology optimized for this."

South Korean Real estate prices are also in the blockchain.

12/8/2020

Elysia (https://elysia.land) announced on the 7th that it has signed a technology agreement with Chainlink (Oracle solution) to provide real estate prices.

Elysia is a blockchain-based real estate investment platform. When real estate tokens representing real estate ownership are purchased, real estate revenue is automatically distributed to token holders through smart contracts on the blockchain.

Chainlink is an Oracle solution that allows data outside the blockchain to be safely imported onto the blockchain network. The Oracle problem is a reliability problem that occurs when external data is brought into the blockchain, and Chainlink provides a function to solve this problem.

Through this agreement, Elysia will be able to import external data faster and more accurately into the blockchain network. First, it will use Chainlink's solution to call the quotes to distribute the monthly rental income of real estate.

In addition, Elysia will provide the price data of residential and commercial real estate in Seoul, which was collected with the Korean Real Estate Development Consortium, to Chainlink's blockchain network.

Jeong-Geon Lim, CEO of Elysia said, "It is very important for Elysia to minimize the risks that may occur between stakeholders during real estate transactions and to create an investment environment based on objective data. From the introduction of this solution, we will research various ways to use internally.”.