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Hong Kong got hit hard. Between July 24 and July 30, romance-based crypto scams wiped out $9 million across 25 reported cases — all in seven days.
The scammers worked dating apps and messaging platforms, building fake relationships before pushing victims into fraudulent crypto investment schemes. One insurance agent lost $3.3 million on her own after a false online romance convinced her to funnel money into a phony platform. That’s a single victim. One week. $3.3 million gone. The scale of it is pretty hard to wrap your head around, and the speed makes it worse — 25 cases in seven days means roughly three or four victims every single day of that stretch.
HashKey, Malaysia Blockchain Week, and a Canceled Performance
Not everything out of Hong Kong was grim. Crypto exchange HashKey Exchange got approval from JPMorgan Chase to open a client money account — a meaningful step for its parent company and a sign that some institutional doors are still opening for regulated crypto players in the region.
Malaysia had a rougher week. Authorities pulled their support for Malaysia Blockchain Week after a backlash erupted over an after-party that featured influencer Siew Pui Yi, who was previously known for adult content. The uproar came fast and loud across conservative social media circles. Event organizers apologized and canceled the performance. It’s a reminder that crypto events in Southeast Asia can’t ignore local cultural sensitivities, no matter how global the industry feels.
South Korea Pushes Digital Asset Law, Stablecoin Outflows Mount
South Korea is moving toward a comprehensive Digital Asset Basic Act. The Financial Services Commission is working alongside the ruling party to draft legislation that would cover stablecoins and broader digital asset regulation. There’s still disagreement over the details — the regulatory path there isn’t clean — but the legislative machinery is moving.
The numbers on stablecoins aren’t flattering. South Korea has now seen 18 consecutive months of stablecoin outflows. In June alone, that figure hit 560.3 billion won, which works out to roughly $367 million. That’s a sustained bleed, not a blip.
On the legislative side, the opposition’s bill to scrap planned crypto taxes moved to a committee stage. The government has committed to rolling out changes on January 1, 2027. No details yet on exactly what form those changes take, but the deadline is set.
South Korea’s police also stood up a 41-member specialized unit focused on crypto-related crimes. The team’s mandate covers things like drug trafficking through Telegram groups — a sign of how tangled crypto crime has gotten with other illegal activity.
Bitget Exits Japan, Gumi Launches $18.3 Million Fund
Bitget is pulling out of Japan. The exchange will stop taking new registrations and start imposing account restrictions from November 1, with open positions forcibly closed by year’s end. No explanation was offered publicly, but Japan’s regulatory environment has grown increasingly demanding for offshore exchanges.
Japanese game developer Gumi is going the other direction. The company is launching an $18.3 million crypto asset fund backed by SBI Financial Services and Daiwa Securities Group. The fund plans to invest in Bitcoin and major altcoins, using strategies that include staking, portfolio rebalancing, and hedging.
FalconX, the crypto prime brokerage, is cutting 10% of its workforce as it braces for what it sees as a prolonged market downturn. The company is shifting its Singapore operation toward crypto derivatives trading and has withdrawn its license application with the Monetary Authority of Singapore. FalconX says it still plans to stay in Asia and wants to grow in Europe. Unclear how that squares with the layoffs, but that’s the stated plan.
China detained 16 people tied to crypto money laundering linked to telecom fraud. Separately, the China Business Journal warned that scammers are impersonating the publication to extort Bitcoin from companies by threatening damaging coverage. Researchers from China’s national police academy also claim to have built an AI system that can detect illegal crypto transactions with nearly 90% accuracy — if that holds up in practice, it’d be a significant tool for enforcement.
A scheme called Fun Coffee, linked to Vietnam, collapsed in Hong Kong. Authorities tagged it as a virtual currency scam that falsely promised annual returns of up to 222%. Seventy-one investors lost a combined $8.5 million to a fraudulent Flare Network staking scheme — a separate fraud, same brutal pattern.
India’s Madras High Court recognized cryptocurrency as a form of “property” subject to trust obligations. And Binance’s APAC Head, SB Sekar, said India should probably look at building a rupee-backed stablecoin to cut dependence on USDT and USDC.
The insurance agent in Hong Kong lost $3.3 million.
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Frequently Asked Questions
How much did Hong Kong investors lose to romance crypto scams in one week?
Twenty-five victims lost a combined $9 million between July 24 and July 30, with one insurance agent alone losing $3.3 million.
Why is Bitget leaving Japan?
Bitget will stop services for Japanese residents from November 1, closing new registrations and forcing open positions shut by year’s end. The company gave no public explanation.
