The Rise of MicroStrategy Clones, Asia Dominates Crypto Adoption: Asia Express 2024 Review

As we approach the end of the year, Asia Express takes a look back at some of the most important developments for Bitcoin and cryptocurrencies in the region in 2024.

MicroStrategy’s Bitcoin Blueprint

MicroStrategy has become a leading example of Bitcoin, securing 439,000 BTC, or about 2% of the total supply, according to BitcoinTreasuries.NET.

Across Asia, Saylor’s Bitcoin blueprint has inspired several companies to stake their future on Bitcoin, and many more are expected to follow suit.

As Asia Express reported last week, Chinese selfie app developer Meitu invested in 31,000 ETH and 940 BTC in the spring of 2021 and has sold them all since November, making a significant profit.

Now it appears that the ‘MicroStrategy of Asia’ title has been taken over by the Japanese company Metaplanet.

The company holds 1,142 BTC after adding 123 coins to its collection on November 19. CEO Simon Gerovich claims that Metaplanet is one of the largest corporate Bitcoin holders in Asia.

But if you look at sheer numbers, Hong Kong-based gaming company Boyaa Interactive has quietly amassed more than its Japanese investors. At the end of November, Boyaa announced that he had converted $49 million of his Ethereum holdings (then 14,200 ETH) into 515 BTC, increasing his holdings to 3,183 BTC. Maybe it’s the real Asian MicroStrategy?

Other companies are also joining in. Nasdaq-listed China-based blockchain and data services company SOS has committed to purchase $50 million worth of Bitcoin, while publicly traded Indian company Jetking Infotrain has adopted a Bitcoin holdings strategy starting at 12 BTC. I did it.

Even governments are getting into the Bitcoin game. Last September, Arkham Intelligence revealed that Bhutan had accumulated twice as much Bitcoin as El Salvador through investment firm Druk Holdings.

The Himalayan kingdom has cashed out some of its Bitcoin since Arkham’s report, but still holds 11,688 BTC as of December 19. Bhutanese officials confirmed that the country has been mining Bitcoin since 2019.

Major Asian Countries Hesitant About Bitcoin ETF

The year started off with a bang, with the U.S. Securities and Exchange Commission (SEC) approving 11 spot Bitcoin ETFs in January.

The United States is often considered a regulatory trendsetter as it is the world’s largest market, and the U.S. dollar functions as the dominant global reserve currency. It wasn’t the first country to list a spot Bitcoin ETF on the market, but it certainly generated a ton of interest.

In late April, Hong Kong, whose dollar is pegged to the US dollar, became the first jurisdiction in Asia to launch a spot Bitcoin and Ethereum ETF.

So far, Hong Kong’s ETFs have underperformed expectations.

Initial rumors ahead of approval included a lot of hype about the ETF potentially opening up cryptocurrencies to investors in mainland China, where crypto trading is prohibited. Chinese investors can invest in the Hong Kong market through the Stock Connect program, which acts as a bridge between the two economies. However, mainland investors are prohibited from investing in Hong Kong cryptocurrency ETFs unless they are Hong Kong residents.

The US Bitcoin ETF attracted billions of dollars in inflows in its first week, setting a high bar that Hong Kong ETFs have failed to achieve. The Hong Kong Bitcoin ETF saw inflows of $262 million during its first week, with $14 million in transactions since listing, most of them pre-listing. As of this week, the ETF’s net assets totaled $437 million.

Meanwhile, Singapore Exchange CEO Loh Boon Chye said the domestic ecosystem was not ready to accommodate such products.

South Korea has emerged as a major cryptocurrency market, with the Korean won dominating global cryptocurrency trading pairs. However, the market remains retail-centric due to local regulations requiring traders to use real-name bank accounts from licensed financial institutions. Companies are excluded from opening such accounts, effectively blocking them from the cryptocurrency market.

South Korean financial regulators began discussions in October about potentially allowing businesses to open cryptocurrency accounts.

war against pig butchers

Named after the tactic of fattening up victims with fake relationships before committing the fraud, pig slaughter scams have evolved through new tools such as AI-based face-changing technology. More than $75 billion has been stolen worldwide in these scams, according to John Griffin, a finance professor at the University of Texas.

In 2024, a survey of large-scale fraud centers across Southeast Asia emerged, with Cambodia emerging as a major hub. Security researchers at Elliptic have identified online marketplace Huione Guarantee as a major money laundering hotspot for illegal actors. Cryptocurrency forensics company Chainalytic discovered that since 2021, Huione Guarantee has processed more than $49 billion in cryptocurrency transactions.

Huione Guarantee is owned by Huione Group, which operates the foreign exchange business Huione Pay. Elliptic roped in Hun To, a cousin of Cambodian Prime Minister Hun Manet, to the Huionepay board. In 2012, Hun To was accused of money laundering and drug trafficking by Australian authorities, but denied all charges.

Last September, the United States sanctioned Senator Ly Yong Phat for alleged involvement in human trafficking and forced labor related to cryptocurrency fraud.

Investigative journalist Mech Dara claimed that Pott’s resort was a hub of such activity where trafficking victims were forced to defraud first world victims. Dara was arrested by Cambodian authorities on charges of “incitement to cause public disorder” in what human rights groups condemned as an attack on press freedom.

There have been high-profile cases in the Philippines, including former mayor Alice Guo, who was implicated in an international fraud network. Authorities reportedly raided a property she co-founded and rescued hundreds of trafficked workers caught up in cryptocurrency scams. Guo is currently under Senate investigation for alleged links to overseas gaming operators, fraud, and links to Chinese crime syndicates.

Asia is leading the way in cryptocurrency adoption, with India and Indonesia leading the way.

Nine of the top 20 countries in Chainalysis’ 2024 Global Crypto Adoption Index are in Asia, with India taking the top spot.

Despite strong adoption in India, cryptocurrencies are still not getting any love from the government. The country has one of the world’s strictest tax regimes for cryptocurrency investors, including a 1% tax withheld on all transactions, which reduces trading volume on local exchanges.

Nine foreign exchanges were expelled from the country in late 2023 after the Intelligence Ministry blocked their URLs. This included Binance, which resumed functioning in 2024. Fears of a potential cryptocurrency ban have resurfaced as central banks are reportedly considering outlawing cryptocurrencies in favor of CBDCs.

Indonesia, which ranked third after Nigeria, topped the region with $157.1 billion in cryptocurrency value received from July 2023 to June 2024.

Singapore and Hong Kong are competing to establish themselves as regional cryptocurrency hubs, ranking in the top 20 in the adoption index. Singapore, which has been praised for its regulatory framework, has approved licenses for major exchanges such as Gemini, OKX and Upbit in 2024, adding to the roster that includes major cryptocurrency companies such as Coinbase and Ripple.

Hong Kong has been slow to issue licenses, but plans to approve 11 by the end of the year, according to Securities and Futures Commission CEO Julia Leung. The city is also considering cutting cryptocurrency taxes for the wealthiest people.

Private wealth in Asia is increasingly interested in cryptocurrencies, with 94% of wealthy investors investing or planning to invest in Bitcoin or other digital assets, according to Aspen Digital.

Lazarus strikes again…

In 2024, a North Korean state-backed hacking group stepped up its hacking and phishing attacks, targeting major cryptocurrency companies to fund the country’s weapons of mass destruction program.

The group has been linked to some of the largest cryptocurrency heists of the year, including the $305 million breach of Japan’s DMM Bitcoin and the $235 million hack of India’s WazirX. Lazarus is also a prime suspect in additional attacks, such as the $20.5 million hack of Indonesia’s Indodax and the $45 million hack of Singapore-based BingX.

In addition to direct hacking, North Korean cybercriminals are infiltrating cryptocurrency companies as employees and siphoning their salaries, generating an estimated $250 million to $600 million in annual revenue, according to UN estimates. Additionally, the Federal Bureau of Investigation has warned of government-sponsored actors conducting social engineering campaigns, including fake job offers and impersonations, to gain access to corporate networks.

Tech giant Microsoft also pointed out that Sapphire Sleet, a North Korean government-backed group active since 2020, is exploiting cryptocurrency companies by posing as venture capitalists. The group lures targets into video conferences and tricks them into downloading malware disguised as connectivity software.

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Yoon Yohan

Yohan Yoon is a multimedia journalist covering blockchain since 2017. He has contributed as an editor to Forkast, a cryptocurrency media outlet, and has covered Asian technology stories as an assistant reporter for Bloomberg BNA and Forbes. He spends his free time cooking and experimenting with new recipes.