Cryptocurrency fraud has been growing globally for several years now, leading to various financial losses. APAC countries are taking a stance in this fight, leading the charge with stronger regulations, advanced technology, intelligence sharing, and other practices. Entrepreneurs and businesses must understand and adopt similar efforts to protect their investments and ensure sustainable growth.
Being aware of the rise in crypto fraud
The first step in fighting crypto fraud is understanding the magnitude of the cases that investors face. According to Chainalysis, activity has increased by 24 percent every year on average since 2020. Some may create investment or giveaway schemes, while others resort to phishing and hacking.
Methods are also becoming more creative with the integration of artificial intelligence. Generative AI, in particular, is a simpler and more affordable way for crypto fraudsters to create fake content. It improves the legitimacy of websites and listings, leaving people feeling more complacent from the get-go.
These people are going as far as combining generative AI use with pig butchering scams, resulting in larger revenue loss. Chainalysis also states that revenue from pig butchering scams rose by almost 40 percent in 2024 compared to the previous year.
Improving regulations
Digital currency can be quite lucrative, but it’s still a rather unstable market. Especially in the West, crypto lacks regulations and government oversight to protect investors. It can also be difficult to revert online transactions involving crypto once they go through.
Multiple countries in APAC have made waves in controlling the space and suppressing financial risks. For instance, South Korea created the Virtual Asset Users Protection Act, which demands recordkeeping and transparency from businesses. Japan implemented stronger rules on sharing customer information regarding crypto exchanges.
China went as far as banning exchanges, trading, and crypto mining, only allowing citizens to hold the digital currency. While India had a similar setup in the past, it was later replaced with the Cryptocurrency and Regulation of Official Digital Currency Bill.
Instilling regular security practices
Crypto consumers are encouraged to have regular security practices. Most APAC institutions are going the extra mile to educate people about this digital currency and how they can best protect their assets.
For instance, the Singapore Police Force promotes enabling two-factor authentication for cryptocurrency exchange accounts. Having these settings along with stronger passwords can limit access to digital wallets.
The Singapore Police Force also recommends using secure wallets like hardware to keep cryptocurrency offline. The less exposure they have, the more secure they are to online attacks. Be sure to have the latest security updates installed when doing exchanges to keep platforms fraud-free.
Employing technological solutions
APAC is also fighting against crypto fraud by utilizing technology-backed solutions. Biometric checks and AI-backed automation are effective when moderating access. About 25 percent of the region’s companies have adopted document-free identity verification as well.
Non-doc identity verification is a newer method that relies more on public databases like credit bureaus and government entities to confirm one’s identity. It deters crypto fraudsters who generate fake ID cards and passports when opening up an account.
All these efforts have improved verification speed and pass rate, decreasing crypto fraud by 23 percent from 2023 to 2024. Only APAC has been able to achieve these kinds of numbers so far, but such achievements can be done on a global scale with enough investment and implementation.
Coordinating and sharing intelligence
Digital assets remain a foreign concept, and fraud schemes are still developing as time goes on. Understanding the mechanics behind these ill-intentioned moves requires plenty of data and experience, and several APAC countries understand that.
Armenia, Hong Kong, India, Japan, Korea, and Singapore are committed to implementing a Crypto Asset Reporting Framework by 2027. The digital currency is classified as a threat since it is being used as an avenue for organized crime activities.
Efforts to spread information can also be seen at the APAC Regional Law Enforcement Day training session held by Binance in Bangkok, Thailand. More than 120 investigation experts from different regions discussed the complex cases regarding crypto and how to combat it. Both public and private sectors are committed to collaborating against these threatening schemes.
Practicing due diligence
Due diligence is also necessary for customers engaging in cryptocurrency. It involves understanding a crypto asset, its mechanics, and regulatory compliance to determine its legitimacy. Entrepreneurs can search for white-listed and black-listed platforms to analyze the fraud and its associated impersonation risks.
There are also financial advisors well-equipped to navigate the crypto space with investors. These experts have fiduciary responsibilities to vet assets before making a recommendation. Aside from increasing the chances of financial success, it protects people from losses.
In the Philippines, due diligence also involves reporting suspicious transactions. Cryptocurrency transactions are classified as cross-border wire transfers, and exchanges exceeding PHP 500,000 must be reported. That way, their Anti-Money Laundering Council can verify the arrangement, which adds a layer of security.
Adopt similar changes
APAC takes a proactive approach when combating crypto, which stabilizes the digital currency’s ecosystem and protects people’s finances. Stay tuned to the ongoing efforts and the upcoming trends in safeguarding assets.
Zac Amos is the Features Editor at ReHack, where he covers business tech, HR, and cybersecurity. He is also a regular contributor at AllBusiness, TalentCulture, and VentureBeat. For more of his work, follow him on Twitter or LinkedIn.
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