Here are some of the major developments from the world of crypto over the past few days
South Korea’s Financial Services Commission (FSC) has issued a notice that by July 2024, investors in digital assets must receive interest when depositing their funds into an exchange. Local media outlets reported on December 10, 2023 that FSC plans to release the legislative guidance.
However, FSC has also clarified that non-fungible tokens (NFTs) and central bank digital currencies (CBDCs) are excluded from the law’, though there can be exceptions.
According to the local report, even if the tokens are categorised as NFTs, but function as a payment method and are issued in large quantities, they may be included in the virtual asset classification. In this case, the assets may be eligible for interest when deposited into exchanges, Cointelegraph reported.
Apart from classifying virtual assets, the South Korean regulator also determined the method for handling user deposits for virtual asset operators. The notice highlighted that exchanges must separate user deposits and their own assets and entrust these to a bank. In addition, 80 per cent of the coins must be kept in a cold wallet. The guidance will also include requirements for preparing for hacks or other computer incidents.
Decentralised finance (DeFi) protocol Venus has confirmed that it was affected by a malfunctioning Binance price oracle, resulting in borrows totalling around $270,000 on December 11, 2023. It, however, confirmed that its user funds were safe.
On December 10, 2023 reports emerged that a malfunctioning price oracle had affected the Binance Smart Chain-based decentralised lending and borrowing marketplace.
A user by the name of SaulCapital alerted on X (formerly Twitter) that the “isolated pool on Venus Protocol for liquid staked BNB got exploited.” He posted a link to a suspect wallet address involved in the incident, which held just under $260,000 at the time of writing.
However, Venus Protocol ambassador NoOneVII responded, stating that it appeared to be an “Oracle price issue, occurring in a small Isolated Market”. “Venus Core Pool and other pools are completely separate from each other and are not affected by this,” he said, adding on the Venus Protocol Telegram channel that there was no problem with security.
Crypto investors have been moving their assets away from crypto exchange HTX (formerly Huobi) following a November 22, 2023 exploit that saw the exchange pause its services and lose $30 million.
Between November 25, 2023 (the day HTX resumed its services) and December 10, 2023, the exchange had some $258 million in net outflows, according to data from DefiLlama.
HTX is the 16th largest crypto exchange by daily trading volume, with a total of $1.6 billion in trading volume in the last 24 hours, according to CoinMarketCap data. Following HTX’s restart on November 25, 2023 Justin Sun-linked crypto exchange promised any affected HTX users that they would be fully compensated for the hot wallet losses, adding that a probe was underway.