The Bank of Korea has reportedly shortlisted three regions, excluding Seoul, for conducting a trial of its central bank digital currency (CBDC), as stated by a local South Korean media outlet.
The chosen locations are Jeju, Busan, and Incheon, which have been designated as potential “private target CBDC test beds.”
The bank’s long-term plan involves selecting one of these regions to experiment with payments and distribution on a public scale, aiming to secure franchises that can accept CBDC payments.
This move is expected to enable not only local residents but also tourists and civilians to participate in CBDC transactions through the CBDC electronic wallet app.
The Bank of Korea has mentioned that the regional closed tests for the CBDC will follow a similar pattern to the current local currency scheme that has been implemented in different parts of South Korea.
This local currency scheme was introduced during the COVID-19 pandemic to address basic income and relief payments.
Notably, the regions shortlisted for the pilot—Jeju, Busan, and Incheon—all currently issue and distribute their own local currencies such as “Tamranjeon,” “Dongbaekjeon,” and “Incheon e-Eum,” respectively.
An official from a commercial bank in Korea has revealed that Busan, due to its large population of eligible citizens, poses challenges for the Bank of Korea.
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Consequently, the selection appears to be leaning towards Jeju, which has the second-largest population.
Comparatively, the local currency scheme presents fewer “technical barriers” in contrast to CBDCs, as reported by the local media.
This observation highlights the importance of conducting trials in different regions to identify potential hurdles and find effective solutions for a nationwide rollout of the CBDC.
Furthermore, various banks in South Korea have expressed interest in stablecoins as potential alternatives to CBDCs, aiming to enhance operational efficiency.
In summary, the Bank of Korea’s decision to narrow down its CBDC pilot to Jeju, Busan, and Incheon reflects the strategic approach towards testing and refining the digital currency.
By conducting regional closed tests, the bank aims to gain valuable insights and establish a robust system for CBDC adoption in the future.
The initiative aligns with the growing interest in exploring alternative payment methods, emphasizing the country’s commitment to staying at the forefront of financial innovation.
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The Curve Finance exploit that occurred recently resulted in one of the largest ever maximal extractable value (MEV) reward blocks, totaling 584.05 Ether (ETH).
Ethereum core developer, known as “eric.eth,” reported on July 31 that the day had witnessed some of the most substantial MEV reward blocks in the history of Ethereum, all of which were caused by the exploitation of Curve Finance stable pools on July 30.
However, it’s worth noting that a larger MEV reward block of 692 ETH was recorded back in March.
MEV bots are responsible for generating additional revenue by reordering or inserting transactions within a regular block, effectively creating arbitrage opportunities.
These bots can also identify pending liquidation transactions and front-run them, purchasing the liquidated assets at discounted prices.
To carry out such actions, MEV bots pay a considerable amount of ETH to the block producer to secure a position at the front of the transaction line.
Validators propose a block using a relay, outsourcing block production to specialized entities that extract this extra revenue.
In return for allowing MEV bots to front-run transactions, validators receive a share of the generated revenue, commonly known as the “block reward.”
One of the highest MEV bot block rewards amounted to 584.05 ETH, approximately valued at $1 million. This reward was confirmed at 1.34 am UTC on July 31, according to Beaconcha.in.
There were also other notable block rewards of 345 ETH and 247 ETH around the same time.
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In response to the news, moral concerns were raised regarding the implications of potentially illicit funds being used to pay validators, allowing for the front-running of transactions.
Some individuals questioned the ethics of MEV rewards going to miners, particularly when these rewards are essentially sourced from hacked funds.
Prior instances have shown how MEV exploitation can lead to significant profits.
For example, in April, a Subway-themed trading bot leveraged “sandwich attacks” during the memecoin trading frenzy, making millions in extractable value.
These recent developments in the MEV landscape have sparked discussions about the ethical considerations surrounding such practices and how they may affect the overall integrity and trustworthiness of blockchain ecosystems.
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Coinbase, the prominent cryptocurrency exchange, was reportedly urged by the United States Securities and Exchange Commission (SEC) to remove all cryptocurrencies from its platform, except for Bitcoin (BTC).
This revelation came to light during a recent interview with Coinbase CEO Brian Armstrong published by the Financial Times on July 31.
According to Armstrong, the SEC demanded the delisting of nearly 250 tokens on Coinbase before initiating legal action against the exchange.
The SEC’s stance was based on its belief that “every asset other than Bitcoin is a security.”
However, Armstrong disagreed with this interpretation, challenging the regulator to explain their reasoning, but they refused, insisting on the complete removal of all tokens besides Bitcoin.
This viewpoint aligns with SEC Chair Gary Gensler’s assertion made in a prior interview that everything apart from Bitcoin falls under the agency’s regulatory purview as a security.
Agreeing to the SEC’s request, Armstrong argued, would have set a dangerous precedent and potentially led to the demise of the entire crypto industry in the United States.
As a result, Coinbase opted to challenge the SEC’s position in court to seek legal clarity.
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The SEC filed a lawsuit against Coinbase in early June, accusing the exchange of operating without proper registration and identifying 13 cryptocurrencies offered on the platform as unregistered securities.
Coincidentally, the regulator also lodged a similar complaint against Binance.
Responding to the situation, the SEC clarified that while its enforcement division does not formally request companies to delist crypto assets, its staff may share their views on actions that might breach securities laws.
Regulation of the crypto industry in the United States has been somewhat ambiguous, with both the Commodity Futures Trading Commission (CFTC) and the SEC exercising regulatory authority over various aspects of the sector.
To address this regulatory uncertainty, legislation aiming to grant primary jurisdiction over cryptocurrencies to the CFTC and define the SEC’s role concerning crypto was passed by the House Agricultural Committee on July 27, following earlier approval by the House Financial Services Committee.
However, further steps are required for it to become law.
In summary, Coinbase’s confrontation with the SEC regarding the delisting of cryptocurrencies other than Bitcoin reflects the ongoing struggle to establish clear and comprehensive regulations for the crypto industry in the United States.
The outcome of this legal battle could have significant implications for the entire crypto market in the country.
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In a recent hacking incident involving the decentralized finance (DeFi) protocol, Curve Finance, an ethical hacker successfully reclaimed approximately 2,879 Ether (ETH), equivalent to around $5.4 million, from a hacker.
Curve Finance experienced an exploit of several stablepools due to malfunctioning reentrancy locks in certain versions of the Vyper programming language on July 30.
The damages Curve Finance faced are speculated to be around $47 million.
Simultaneously, other DeFi protocols that were utilizing the susceptible versions of Vyper were exploited as well, posing a significant challenge to the DeFi ecosystem.
Identified as “c0ffeebabe.eth”, an operator of a maximal extractable value bot, used a front-running bot against the malevolent hacker, securing nearly 3,000 ETH. These reclaimed funds were returned to the Curve deployer address, the expected rightful holder.
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In the aftermath of this incident, fraudulent refund schemes are being propagated on Twitter.
Impersonators of Curve Finance and victims of the hack are advocating a counterfeit refund scheme, aiming at those who already suffered losses due to the hack. Curve Finance’s official account has yet to discuss a refund plan.
Simultaneously, BNB Smart Chain has encountered similar attacks due to the Vyper vulnerability, as shared by BlockSec, a blockchain security firm. An approximate amount of $73,000 was stolen in three different exploits.
In related news, the U.S. Securities and Exchange Commission has enforced new regulations for cybersecurity incidents involving publicly-traded U.S. companies.
These rules mandate disclosure of a cyberattack four days after it’s deemed “material” and also periodic reporting on policies to manage and identify cybersecurity risks.
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The Korea Financial Intelligence Unit (KoFIU) urged the country’s crypto industry to intensify their efforts in combatting illegal activities during a meeting held on Thursday.
KoFIU Commissioner Rhee Yunsu announced the establishment of a dedicated “strategic analysis team” focused on crypto-related crimes.
The team aims to enhance systematic identification and analysis of illicit activities in the crypto sector, enabling KoFIU to provide more valuable data to law enforcement and investigators, as stated by South Korea’s Financial Services Commission.
During the meeting, KoFIU stressed the need for the industry to bolster its compliance capacity and enhance its response to illegal activities.
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Five prominent companies from South Korea’s crypto industry, including local crypto exchanges Upbit and Bithumb, were present at the gathering.
Coincidentally, the meeting took place just one day after the South Korean government formed an interagency investigation unit specifically targeting crypto crimes.
The joint unit, operating from the Seoul Southern District Prosecutors’ Office, comprises 30 investigators from agencies such as the Prosecutor’s Office, the Financial Supervisory Service, the National Tax Service, and the Korea Customs Service.
Traditionally a crucial market for cryptocurrencies with significant investor interest and numerous crypto companies, South Korea’s authorities have recently adopted a tougher stance towards the industry.
In response to concerns over potential misconduct, prosecutors had previously conducted raids on the offices of Bithumb, alleging price manipulation in the crypto market.
Additionally, the country took action against Do Kwon, the founder of Terra and a Korean national, who was found guilty of attempting to leave the country using a forged passport.
Presently, Do Kwon is in custody in Montenegro due to the legal actions taken against him.
In light of the evolving regulatory landscape and the growing importance of the crypto market in South Korea, both KoFIU and the newly formed joint crypto crime unit are determined to ensure the industry operates with integrity and transparency.
By intensifying efforts to prevent illegal activities, they aim to maintain a secure and reputable environment for crypto-related businesses and investors in the country.
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Tech firms including GitHub, Hugging Face, and Creative Commons have joined forces to pen an open letter urging the European Union (EU) to revise its upcoming regulations for open-source artificial intelligence (AI) models.
The letter, addressed to policymakers, argues that subjecting upstream open-source projects to the same regulations as commercial products or deployed AI systems would hinder the development of open-source AI.
The group highlights five key suggestions to ensure that the EU’s Artificial Intelligence Act accommodates open-source models effectively.
First, they propose clearly defining AI components to avoid ambiguity in its implementation.
Second, they seek clarification that collaborative development on open-source models should not subject developers to the bill’s requirements.
Third, they advocate for researcher exceptions, allowing limited testing of open-source AI in real-world conditions. Fourth, they recommend setting proportional requirements for “foundation models.”
Open-source software, by definition, allows public access to its source code, enabling inspection, modification, and enhancement by anyone.
In the context of artificial intelligence, open-source software plays a crucial role in training and deploying models.
The European Parliament already passed the AI Act in June with a strong majority of 499 votes in favor, 28 against, and 93 abstentions.
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However, the act will become law only after reaching a consensus with the European Council, which represents 27 member states.
The subsequent step involves negotiating with individual EU members to iron out the finer details.
The open letter recognizes that the AI Act has the potential to set a global precedent in regulating AI, striking a balance between addressing risks and promoting innovation.
The signatories emphasize that the regulation should foster transparency and collaboration among diverse stakeholders.
They assert that AI requires appropriate regulation to mitigate risks, establish clear standards and oversight, and provide recourse for any resulting harms.
In conclusion, the tech firms’ open letter aims to influence the EU’s AI regulations by advocating for measures that promote open-source AI development while addressing the challenges posed by this rapidly evolving technology.
They hope to strike a balance that encourages innovation, ensures transparency, and safeguards against potential risks.
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The United States Department of Justice (DOJ) is seeking the revocation of Sam Bankman-Fried’s bail, as stated in a court filing on July 28.
The accusations against him include attempting to tamper with witnesses and leaking Caroline Ellison’s diary to The New York Times.
SBF was initially released on bail on December 22, 2022, but later requested multiple modifications to his bail conditions. On January 15, 2023, he reportedly contacted the current general counsel of FTX US through email and the encrypted messaging app, Signal.
In this communication, SBF expressed a desire to reconnect and explore the possibility of establishing a constructive relationship, potentially using each other as resources or providing mutual input on various matters.
However, the DOJ alleges that SBF also used Signal for obstructive purposes, taking advantage of the app’s auto-deletion feature to complicate the investigation.
This behavior raised concerns about potential witness tampering in the eyes of the court.
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Former U.S. Securities and Exchange Commission’s Office of Internet Enforcement chief, John Reed Stark, explained that Judge Lewis Kaplan has several options in response to SBF’s actions.
The judge could interpret them as attempts to improperly influence witnesses, leading to either further modifications to his bail conditions or the complete revocation of his bail.
U.S. Attorney Danielle Sassoon requested the revocation of SBF’s bail after a July 26 hearing in a Manhattan court.
The allegations against SBF include using his freedom to intimidate Caroline Ellison, his former romantic partner and colleague.
Sassoon informed the judge that SBF made approximately 100 calls to an NYT reporter in an attempt to “intimidate” Ellison.
In a separate complaint filed on July 20, the DOJ accused SBF of leaking Ellison’s diary to discredit a government witness publicly. By sharing her personal writings with a reporter, SBF allegedly aimed to undermine her credibility.
The written submission to the court followed the July 26 hearing and raised questions about whether SBF should remain free on bail.
Judge Kaplan faces a difficult decision in this case, as he must weigh the allegations against SBF and consider the potential risks posed by his actions.
Should SBF be allowed to remain free, the judge is likely to reiterate previous warnings.
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Kyrgyzstan, a central Asian nation sharing borders with China, is making strides in the realm of cryptocurrency mining, with the backing of its local government.
On July 27, Kyrgyz President Sadyr Japarov gave the green light to establish a crypto mining farm at the Kambar-Ata-2 Hydro Power Plant, as reported by Kyrgyzstan’s national news agency, Kabar.
The Kyrgyz government plans to invest up to $20 million in constructing this cryptocurrency mining facility.
President Japarov emphasized that operating such a farm would enable the government to utilize surplus power from the hydroelectric plant efficiently, thus avoiding energy losses.
Since the plant’s inception in 2010, Kyrgyzstan has lost a significant 6.8 billion kilowatt-hours of energy due to inefficiencies.
By harnessing the remaining energy for crypto mining, the Kyrgyz government aims to generate revenue that can benefit the country’s budget and ultimately benefit ordinary citizens.
President Japarov highlighted that the earnings from the mining farm will be closely monitored and used for the benefit of the people, emphasizing transparency and automation in the process.
However, the report seems to contradict recent energy-related developments in Kyrgyzstan.
On July 24, the Kyrgyz president announced a state of emergency in the country’s energy sector, scheduled to begin on August 1, 2023, and expected to last until December 31, 2026.
The emergency has been attributed to climate challenges, reduced water inflow into the Naryn River basin, and inadequate generating capacity due to soaring energy consumption.
Despite this, President Japarov asserts that crypto mining will be subjected to the highest tariff available in Kyrgyzstan, approximately 5 Kyrgyzstani soms ($0.057) per kilowatt-hour.
While the press office of the Kyrgyz government has not yet responded to media inquiries, it is evident that Kyrgyzstan’s authorities view cryptocurrency as a potential means to boost the country’s economy.
As early as March 2022, Kyrgyz lawmaker Karim Khanjeza advocated for the legalization of the cryptocurrency industry during a parliamentary committee meeting.
He urged the government to establish a legal framework for cryptocurrencies, emphasizing their rapid growth and potential economic benefits.
Despite some regulations introduced for crypto exchanges in 2021, Kyrgyzstan has yet to pass comprehensive laws concerning cryptocurrencies.
Additionally, a former government official previously claimed that cryptocurrency mining exacerbated Kyrgyzstan’s energy crisis.
In conclusion, Kyrgyzstan’s move to establish a cryptocurrency mining farm at a hydroelectric plant holds the promise of optimizing energy use and contributing to the country’s financial resources.
However, the decision comes amidst an ongoing energy crisis and raises questions about the nation’s energy priorities and sustainability in the long run.
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In a formal letter addressed to Apple CEO Tim Cook, United States Representatives Gus Bilirakis and Jan Schakowsky raised concerns regarding the potential impact of the company’s App Store guidelines on emerging technologies, particularly blockchain and nonfungible tokens (NFTs).
The lawmakers expressed worries that the guidelines might inadvertently hinder the progress and growth of cutting-edge innovations.
The lawmakers pointed out a discernible pattern in Apple’s approach to its App Store guidelines, wherein the company appeared to capitalize on crypto apps while simultaneously limiting their functionality.
This was achieved through the requirement of releasing “lite” versions of the apps, which generated profits for Apple but reduced the overall utility of the applications.
The specific case of Axie Infinity’s App Store experience was cited as evidence of this pattern.
By penning this letter, the lawmakers conveyed their concerns about the potential negative consequences of Apple’s policies on the United States’ standing in emerging technologies.
They highlighted that Apple justified these limitations as a measure to enhance security with a “walled garden” approach.
However, there was widespread concern that the company might be using the App Store as a tool to stifle competition.
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The chairman and ranking member of the Innovation, Data, and Commerce Subcommittee stressed the importance of Congress comprehensively understanding the App Store guidelines and assessing the extent to which they may hinder innovation.
They also emphasized their commitment to promoting full transparency and holding Big Tech accountable for any monopolistic behavior.
Furthermore, the lawmakers expressed their intent to create a level playing field within the industry to ensure that American ingenuity can continue to thrive.
This is not the first time they have raised concerns about App Store policies, as they previously wrote a similar letter to Apple regarding guidelines concerning TikTok and other apps originating from China.
In conclusion, Representatives Bilirakis and Schakowsky are seeking information from Apple to understand the potential impact of the App Store guidelines on emerging technologies.
They are concerned that these guidelines may be hindering innovation and competition, and they are committed to promoting transparency and fairness within the industry to support American ingenuity.
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Formerly a product director at Twitter, now identified only as X, has revealed new insights into the inner workings of the social media giant under entrepreneur Elon Musk’s leadership.
In a lengthy 2,400-word tweet and accompanying video, X described the pre-Musk era at Twitter as a mixture of “amazing and terrible,” plagued by bureaucracy.
However, under Musk’s leadership, the post-Musk Twitter has been a rollercoaster of challenges and drama.
X was among the few original members of the Twitter team who decided to stick around when Musk took over, hoping that his influence would steer the company in the right direction.
Unfortunately, she was one of the 200 employees who got laid off during Musk’s round of layoffs in February.
X initially viewed Musk as a bold and inspiring entrepreneur, responsible for creating successful companies like Tesla and SpaceX. She believed that Musk’s ownership could breathe new life into Twitter.
Despite Musk’s charm, X soon discovered that his leadership style had its downsides.
He often lacked empathy to a painful extent, and his unpredictability made employees afraid to share bad news or contradictory opinions with him.
This fear led to the formation of a fanatical inner circle that unquestionably supported everything Musk said.
Musk’s aversion to criticism led him to seek advice from unconventional sources, like polling Twitter, consulting friends, or even turning to his biographer for product advice.
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He seemed to trust random feedback more than the dedicated employees in the room who were experts in solving the company’s problems. This approach puzzled X and others.
Since Musk took over Twitter in October 2022, he introduced various crypto and finance-related features to the app.
Under the rebranded name “X,” Musk envisions turning the social media platform into an “everything app” with features like electric payments, voice calls, and a potential integration with the meme token Dogecoin (DOGE).
Cointelegraph reached out to Twitter for comments, but they did not receive an immediate response.
In conclusion, X’s revelations shed light on the challenges and peculiarities of working under Elon Musk’s leadership at Twitter.
While his bold and inspiring personality brought some optimism, his unpredictable and unresponsive nature created an environment of fear and an inner circle of unquestioning support.
Despite these hurdles, Musk continues to drive the company forward with ambitious plans for its future as “X.”
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