Blog – Page 3 – NUS FinTech Lab

Let’s Not Learn the Wrong Lessons from What Happened at CNET

One article on CNET, the American website that covers and reviews technology and consumer electronics, was titled “What is a credit card?”. Another was titled “How to close a bank account?”.

While these explainers were published under the unassuming byline “CNET Money Staff”, the articles were not written by staff members, or any human beings at all.

The tech website Futurism revealed last month that should one click on “CNET Money Staff”, there was a drop-down description that read: “This article was generated using automation technology and thoroughly edited and fact-checked by an editor on our editorial staff.”

Futurism added in its article that there had been no official announcement from CNET at that time disclosing its use of AI despite more than 70 such articles being seemingly AI-generated at that time.

The use of AI in journalism is not new. The news agency Associated Press started using AI to generate short articles about business earning reports as early as 2014, eventually expanding its use and making use of AI for sports reporting as well. Bloomberg News reporters use the system Cyborg — which can sift out the most pertinent facts and figures from a financial report very quickly the moment it is released, with the New York Times reporting in 2019 that roughly a third of the content published by Bloomberg was produced with the use of some form of automated technology.

The use of technology is particularly crucial for companies like Bloomberg and Reuters that are in the business of financial journalism, where outlets race to publish crucial information that informs the trading decisions of many readers ahead of their competitors without compromising the accuracy of their journalism.

Technology has also been used in newsrooms for purposes other than to generate stories. The Financial Times, for instance, developed a bot that tracks the number of women quoted in their news stories, in response to findings that women featured far less than men in articles — identified as a potential reason for lagging female readership.

However, news articles by AP, for instance, are not exactly “written” by AI. Instead, they require reporters and editors to craft several versions of a story upfront for the various possible outcomes of an event. The AI software then creates an article by inputting data, once made available, into the pre-written story templates. CNET, on the other hand, is utilising AI to write and put together not routine stories about a company’s earnings but whole explainers breaking down complex financial ideas to consumers, with editors only making edits and amends to an article mostly written/ generated by AI.

Futurism’s story about the use of AI to write stories at CNET came just weeks after ChatGPT has taken the world by storm and teachers, regulators and technology executives are grappling with the far-reaching consequences that generative AI chatbots will have on the future of work and education.

What followed the story was outrage from critics who were worried about the use of AI decreasing the quality of journalism while potentially eliminating work — especially for entry-level writers, a post from a CNET editor confirming their “experiment” with AI, as well as much scrutiny of the nearly 75 pieces generated by AI.

With heightened scrutiny came a flurry of correction notices, as Futurism called out CNET for making a number of “dumb errors” in their AI-generated pieces. The stories, for instance, suggested that one will earn $10,300 a year after depositing a mere $10,000 dollars into a savings account that pays 3 percent interest compounding annually (instead of $300); asserted that the interest for Certificate of Deposits (CDs) only compounds once when in reality, they can compound monthly and even daily depending on the specific product; and misrepresented the way interest rate payments are made on a car loan. Beyond factual errors, the stories were also said to be rife with plagiarism, at times plagiarising from CNET itself or its sister websites. All this was despite supposedly thorough fact-checking and editing by editors.

At the back of these revelations came much negative news coverage. A column in the LA Times called the AI Chatbot “a plagiarist — and an idiot”, adding that: “This level of misbehaviour would get a human student expelled or a journalist fired.” A Washington Post headline called CNET’s efforts “a journalistic disaster”. Futurism, which has been leading the coverage of this incident, has called the chatbot “a moron”.

However, such alarmist coverage of the incident risks obscuring and burying a more nuanced conversation we need to have about the use of generative AI in financial journalism and finance content creation.

Firstly, we need to understand what generative AI can and cannot do.

Generative AI cannot convince a whistle-blower to leak documents, build relationships with sources, land scoops or go out to the field and ask questions. Even when it puts together a story based on a prompt, what an AI chatbot does is “assemble” a story by churning through vast repositories for information available to it. But the fact that it does not “understand” questions or prompts the way humans do does not necessarily suggest that generative AI software has hit a ceiling in terms of its capabilities. As the AI program is fed more and more prompts and processes more and more material, the quality of its responses is only likely to get better.

But secondly and very crucially, it will be a mistake to attribute all the missteps at CNET solely, or even largely, to the deficiencies of the technology. Subsequent hard-hitting reporting by the publication The Verge has revealed that even within CNET, few people other than a small team knew much about the use of AI. Staff who were aware of the use of AI also told The Verge that workflows were unclear and that they themselves were often unable to ascertain which stories were written by colleagues and which ones weren’t.

The use of AI to generate content also needs to be understood as part of CNET’s parent company, Red Ventures’, efforts to generate more cash by churning out more search engine optimised content with advertising nestled within the article. When more people read their articles and click on advertising links, Red Ventures generates more revenue. The use of AI instead of humans to write such articles is thus an effort to increase the profit from having more articles to read.

The use of AI technology by particular companies or organisations for predatory purposes, or without much thought given to how to incorporate them in a transparent, responsible manner, is not an indictment of the technology and its potential.

AI has enormous promise in the Fintech and financial journalism space. Fintech startups can potentially use generative AI to help them ideate and even write drafts of marketing material or content for their websites. AI can also help journalists compile information, or help them plough large troughs of data and flag up areas that they should look into. It can also do more mundane tasks like write up press releases and work on more straightforward stories, while journalists can focus on more enterprise reporting and investigative work.

What will be dangerous is say, the use of AI by a news organisation giving them significant advantages over their competitors in terms of speed or revenue, thereby kick-starting a race to the bottom where other organisations feel the need to also recklessly adopt the technology or risk being left behind without being able to consider the ethical and practical questions the usage of technology raises.

Therefore, it is crucial for us to think of the norms that should surround the use of AI and generative AI in fintech and business journalism. Prominent disclosures about the use of AI to generate content, and not obscuring its use, is one important one. The procedures by which AI-generated content is edited by humans is another area where standards and governance policies will be important. Especially as it concerns financial journalism, consumers and businesses are potentially making enormously significant decisions based on the information available on topics such as interest rates and loans and thus, accuracy is vital.

Speaking to The Washington Post, Hany Farid, a professor at the University of California, Berkeley who is an expert in deepfake technologies wondered if “the seemingly authoritative AI voice led to the editors lowering their guard,” making them “less careful than they may have been with a human journalist’s writing”. In another possible explanation, Futurism drew parallels to self-driving cars, suggesting that editors perhaps went on “auto-pilot” the same way drivers behind the wheel of autonomous vehicles tend to do when they no longer need to actively work the controls of the car. Regardless of the reason, it is vital that better practices are developed to ensure that misinformation does not slip through the cracks.

Years after the downfall of Theranos and Elizabeth Holmes, The New York Times reported that there continued to be hesitation to invest in diagnostic companies and that female entrepreneurs were frequently compared to Ms. Holmes, even when it was unwarranted. Similarly, while investors and executives should be careful about the use of AI in journalism, it is crucial that they do not overreact and immediately dismiss any potential use because of what happened at CNET, but instead remain open to the possibilities AI may offer, especially in the future.

Disclaimer: The views and opinions expressed in this article are solely those of the author and do not reflect the official policy or position of the National University of Singapore (NUS) or the NUS FinTech Lab.

Moving towards Harmless AI – the Future of Fintech

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There are many reservations about the use of AI by dominant institutions and companies – namely, the lack of transparency and the potential for discrimination. People are worried that the algorithms may not always be understandable, and that the accuracy of results must be upheld, along with the transparency of the algorithmic process for legal explainability. Recent studies and developments show how credit prediction algorithms tend to reflect the bias in the data, raising the risks of discrimination against minority groups. There have been recent efforts to push for safe and responsible AI, including the development of “constitutional AI” models that aim to reduce human bias, increase transparency, and improve fairness and equality.

An AI arms race has shaken the tech industry.

Within a week, Microsoft announced plans to integrate ChatGPT’s revolutionary technology into its search engine Bing, Google invested $300 million in Anthropic, the maker of ChatGPT’s rival, and Alphabet’s shares plummeted after Google’s AI chatbot Bard answered a question incorrectly.

The integration of AI into everyday institutions, products, and services have been increasingly and inevitably prevalent over the last few years. Recognising AI’s potential as early as 2019, The Money Authority of Singapore (MAS) launched the National Artificial Intelligence Programme in Finance. Under the programme, financial institutions (FIs) are able to use AI technology in financial risk assessments more productively with the intention to create commercial opportunities for businesses and employment for citizens.

The breakneck speed at which AI is being made available to institutions, companies, and citizens have caused anxiety around its potential shortcomings when it comes to ethics and fairness. Tech giants and government bodies giving technology the power to play a major role in decision making posits an urgent concern: ensuring that the integrity and responsibility of such powerful groups are not compromised. In late 2022, DBS launched an AI-driven initiative to bolster the application process for working capital loans. With the financial livelihoods of small businesses at stake, is it really safe to be employing such novel technology in its important decision-making?

Thus, the discourse surrounding these integrations largely focuses on developing safe and responsible AI. Government-backed efforts such as the MAS AI in Finance programme highlights the importance of ensuring “MAS’ fairness, ethics, accountability, and transparency (FEAT) principles” are upheld. Likewise, Anthropic threatens OpenAI’s dominance in the AI sphere by priding itself as an “AI safety and research company”.

What are some of the reservations people currently have around AI being used by dominant institutions and companies?

One of the major contentions surrounding AI’s role in the finance industry is the lack of transparency. There appears to be a lack of public support for these AI models. Their algorithms are also sometimes known as ‘black boxes’; the way they operate is not always understandable to users. If these algorithms are being given the power to participate in important decision making, it is legally and ethically imperative that all interested parties are privy to how the AI reaches its conclusions. In corporate risk assessments, an AI model’s complex process may produce good results but may lack visibility and interpretability. The accuracy of results need to be upheld; transparency of the algorithmic process is also needed for legal explainability.

Viral news of harmful AI or algorithmic bias has also sparked heated discussions. AI operates through machine learning (ML) – a process similar to human learning, that looks for patterns in the data with the intention that it can continue to learn and improve automatically. Though the technology is automated, it is still based on human input. In a Tweet that has garnered nearly 9,000 likes, a user posts a screenshot of a seemingly racist and sexist output from ChatGPT. The AI was asked to produce a Python function that would check if someone would be a good scientist based on race and gender. The AI responded code that discriminatorily favored the conditions “white” and “male”.

Examining the use of AI by banks, a 2022 study showed how credit prediction algorithms tended to reflect the bias in the data. Specifically, it acknowledges the potential discrimination against minority groups within the classes of race, gender, or sexual orientation. These risks should be attended to with caution by AI developers, especially if such technologies are to be commonly implemented in a country as multicultural and diverse as Singapore. A local study examines a model similar to that of most international banks. Such models examine consumer data, excluding “protected” variables such as age or gender and using “proxy” variables like education type in an attempt at inclusion and fairness. The results showed that these efforts still failed to eliminate discrimination. So why are companies and institutions still integrating these algorithms so rapidly when it appears, at least for now, that AI technology is still unable to escape potential human bias and discrimination?

The push for safe and responsible AI has recently shown promise. Anthropic, the receiver of Google’s $300 million investment, has pointed to its research on “constitutional AI”. This study posits a model that has been shown to produce less harmful outputs. It seeks to mitigate human bias by using AI feedback in the AI’s reinforcement learning, minimizing the need for labeling by humans, a process that may introduce bias. It also addresses the prior issue of transparency, using “chain-of-thought reasoning” through which the AI cannot produce evasive responses like “I’m sorry, I cannot answer that”. However, though Anthropic’s novel model seems to produce more transparent and less harmful results, helpfulness or accuracy seems to be compromised.

Despite its limitations, if constitutional AI can truly reduce the biases and discrimination that plague current AI models, it may just revolutionize the accessibility and inclusivity of the technology’s implementation in sectors where careful decision-making is key, such as the finance sector. AI has been and continues to be integral to the endeavor towards financial inclusion. Singapore-based ADVANCE.AI has partnered with Visa in an effort to improve credit accessibility across Southeast Asia. The integration of this technology affords credit companies the ability to reach the underbanked by way of alternative consumer data. In dealing with such an underprivileged group, constitutional AI and its promise of improved fairness and equality would be helpful in boosting these efforts.

There is still much work to be done in developing artificial intelligence for fair and ethical use in our financial systems. Singapore remains a frontrunner in the push for reliable and safe AI implementation. Launched in 2022 by the Infocomm Media Development Authority (IMDA), A.I. Verify is a government initiative that allows participating companies to use technical and process checks as a means of ensuring transparency and responsibility in their use of AI. The programme is still in its pilot stage but hopes to improve trust with stakeholders in the industry and contribute to international standards of development.

Progress seems to be made, but a careful balance between transparency, accuracy, and harmlessness has yet to be achieved. Success in mitigating the harmfulness of AI algorithms seems increasingly promising for the efforts towards fairness and financial inclusion. However, biases in algorithms are ultimately a reflection of the data it is based on. For now, it appears the ML cliché still rings true: “garbage in, garbage out”.

Singapore’s Payments Industry: The Way Forward in 2023

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According to #PwC, 31% of Singapore’s Fintech firm provides payment services, making payments the largest subsector in Fintech.

What are some of the most commonly used #payment methods in Singapore? What is an E-wallet? How do “Buy Now, Pay Later” services work? If you are interested to find out about the answers to these questions, check out the following article as our student writer sheds light on recent developments in Singapore’s #Fintech scene and what to expect in 2023. #BNPL #ewallet #PayNow

Payments Industry: The Way Forward in 2023

2022 has been an exciting year for Singapore’s Fintech industry as we witness many new developments across various subsectors, such as the launch of virtual-only banks and heightened interest in Buy Now Pay Later (BNPL) services. Across the ASEAN region, the average size in Fintech deals increased from US$23 million in 2021 to US$26.5 million in 2022. According to KPMG, Singapore’s global market share has also doubled from 3.1% of global deal value for Fintech in FY 2021 to 6.4% in Q2 2022. As of June 2022, Singapore is home to 1007 operating Fintech firms, which constitutes 67% of the total number across the region. Such trends further anchor Singapore’s leadership position in Southeast Asia’s Fintech scene. As suggested by PwC’s 2022 Fintech State of Play report, up to 31% of Fintech firms in Singapore provide payment-related services, making Payments the largest subsector in Fintech. Let’s review the state of payments in Singapore in 2022 and the way forward for the payment market and what consumers like you and I might expect in 2023 and beyond.

Bye Bye Cash, Hello Cashless Payment!

In 2022, we observed a surge in the usage of digital payments, which can be attributed to e-commerce growth and the adoption of cashless payment technologies at physical stores. Among the many digital payment technologies, PayNow and e-wallets are becoming increasingly popular. Launched in 2017, PayNow is a P2P fund transfer service which allows payments to be paid to Corporates via UEN and to Individuals via mobile number, NRIC or Virtual Proxy Address, saving the hassle of providing elusive bank account details during the transfer. Over the years, PayNow has seen a surge in total number of registrations and has more than 5 million users till date.This fund transfer service has also been extended to corporate users and currently, the number of corporate users has already surpassed 240,000. PayNow allows users to make payments to entities by simply scanning a PayNow QR code, which is integrated with the Singapore Quick Response (SGQR) code. Given its high adoption rate and the convenience it brings, PayNow is unarguably integral to every Singaporean in their daily lives.

Apart from PayNow, the use of e-wallets is also becoming more prevalent in Singapore. According to Bloomberg, the market for e-wallets is expected to grow by 311% between 2020 and 2025 in Southeast Asia. Despite having Southeast Asia’s highest card penetration rate at 1.73 debit cards and 1.61 credit cards per capita, Singaporeans have been rather receptive to new payments technology over the years. In fact, the number of e-wallet users in Singapore has surpassed 4 million. An e-wallet is an alternative to mobile payment whereby users can make contactless payments using their mobile phones instead of using a physical card. In addition, e-wallets requires users to load funds into the them using credit or debit cards before transactions. Certain e-wallets, such as Singtel’s Dash Wallet, also allow users to top up their e-wallet through physical avenues – e.g. at 7-Eleven outlets and Singtel Shops. When one makes any transactions, the e-wallet will process the transaction directly and deduct from the amount of fund that was loaded into the e-wallet.

Locally, the top e-wallet providers are GrabPay, DBS PayLah! and Singtel Dash. Often, e-wallet providers can be categorised into a few categories as these e-wallets are embedded in various apps (See Table 1). Such embedment allows providers to integrate or even launch their own payment method to go hand in hand with their product offerings.

Types	Examples
Independent Apps	GrabPay, ShopeePay, Alipay, WeChatPay, YouTrip, Revolut
Mobile Service Providers	Singtel Dash
Financial Institutions	DBS PayLah!

Table 1: Types of E-wallet Providers

One reason for the popularity of e-wallets and why consumers may choose an e-wallet solution over credit cards is the attractive rewards and perks given, in addition to access to integrated features of the app. For example, for each GrabPay transaction made, users can earn GrabRewards points which can then be used to claim discount vouchers for ride-hailing and food delivery services offered on the same app. The region’s leading e-commerce platform, Shopee, also launched ShopeePay back in 2019 to provide greater convenience to users when checking out online. Secondly, certain e-wallets allow for multi-currency payment which may help to reduce costs when doing online shopping or paying while travelling overseas due to attractive exchange rates; some even absorb foreign transaction fees (which can be hefty for credit and debit card transactions). Frequent travellers may have heard of YouTrip which offers a multi-currency e-wallet that allows users to pay in more than 150 currencies when shopping online or overseas. Apart from online purchases, e-wallets have also expanded their offerings to allow payments at brick-and-mortar stores.

Furthermore, the adoption of e-wallets has made it easier for foreigners to spend in Singapore, benefitting merchants. As the local e-wallet market matures, the Singapore government has also been actively pursuing partnerships to facilitate cross-border e-wallet payments. You may have noticed Alipay+ advertisements have started to spring up at locations like Changi Airport. Alipay+ is a payment solution which allows users from China to pay using their local e-wallets when spending overseas. Currently, Alipay+ allows Singapore merchants to accept 6 different e-wallets (see Table 2), of which half was made available last year. As we examine these foreign e-wallets, it is not difficult to realise that the providers are from Singapore’s top tourist regions by arrival – ASEAN, South Korea and China. Thus, as the COVID-19 pandemic subsides, we can expect greater foreign spending with the recovery of the tourism industry, and merchants who accept e-wallet payments will benefit from more convenient spending by visitors.

Target Market	Foreign E-wallet Offering	Number of Users (2022)
Philippines*	GCash	71 million
Thailand*	TrueMoney	> More than 50 million
Malaysia	Touch ‘n Go	> 17.8 million
South Korea	Kakao Pay	39.44 million
Mainland China	Alipay	1.3 billion
Hong Kong SAR, China*	AlipayHK	3.3 million

*New additions in 2022
Table 2: Foreign E-wallets accepted under Alipay+ in Singapore

Due to its pros, e-wallets are predicted to surpass credit cards as the most common e-commerce payment methods with a share of 27% by 2024. However, as the use of e-wallets is becoming more prevalent, we ought to recognise that there are still limits and they cannot completely replace the use of credit or debit cards. For one, under Singapore’s Payment Services Act, consumers can only hold a maximum of $5000 in each e-wallet at any given time. Such caps may make the transfer of funds a hassle for consumers who frequently transact through e-wallets. Good news is, back in November 2022, the Singapore government initiated a public consultation and has started to review the possibility of raising the fund limit from $5000 to $20,000. We can foresee that in 2023, with greater adoption rate of e-wallets, there may be amendments prudently made to existing regulations to accommodate consumers’ needs.

Buy Now Pay Later: Stricter regulations moving forward

Buy Now Pay Later (BNPL) is a flexible form of short-term financing which allows customers to pay for goods over time through several interest-free instalments. Locally, Atome, ShopBack Pay Later and Grab PayLater are some of the most popular BNPL providers. Traditionally, banks have also been offering similar 0% interest instalment plans for credit cards and BNPL providers differentiate themselves by absorbing processing fees and providing attractive discounts. Their business model works by charging their partner merchants transactions fees for revenue generation.

Thanks to increasing e-commerce purchases, BNPL has started to gain traction in 2022 since its entry in 2017, particularly among the millennials. It is forecasted that the adoption of BNPL will see a CAGR of 19% from 2022-2028 and its Gross Merchandise Value in Singapore will increase from US$804.9 million in 2021 to surpass US$3158.3 million by 2023. Notably, Hoolah, one of Singapore’s largest BNPL service provider, experienced a rise in transactions of more than 1500% during the COVID-19 pandemic.

According to Milleu Insight research, 30% of Singaporeans aged 25 to 40 have utilised a BNPL service. There are reasons as to why BNPL is gaining traction among millennials. For one, BNPL allows millennials who are not eligible for a credit card to be able to afford big-ticket items. It could also be the case that millennials are more tech-savvy and are more accustomed to online payments. In order to increase the adoption rate, BNPL providers have also been launching campaigns and offering discounts and perks to users. For example, Atome’s app has several online shopping vouchers which allows customers to save some money when making purchases.

However, as BNPL gains traction, concerns such as BNPL services encouraging impulse purchases and whether such services will lead to over-indebtedness have surfaced. While BNPL services allow customers to pay in instalments, customers may be subjected to late payment fees ranging from $5 to $90 depending on the number of instalments missed and the type of item purchased. In 2021, the Monetary Authority of Singapore commented that while BNPL provides great convenience for consumers, consumers “may be at risk of spending more than what they have budgeted for”.

In response to these concerns, the Singapore Fintech Association partnered with industry players such as Grab Financial Group, Shopback and Atome to form the Buy Now Pay Later (BNPL) Working Group to launch a Buy Now Pay Later Code of Conduct, which includes guidelines on fees (including late fees and other charges), interest rates, and marketing practices to not mislead consumers. To prevent consumers accumulating debt, BNPL providers will ban customers from making further BNPL purchases once a payment is overdue. In addition, customers will not be able to accumulate more than $2,000 in outstanding payments unless they pass an additional assessment to review their credit worthiness.

The code of conduct also mentions that a credit information sharing bureau will be set up in late-2023 with the help of Experian, a leading global information services company. The bureau will include users’ credit information (such as BNPL balances, missed payments) shared by all accredited BNPL players in Singapore for creditworthiness checks to be carried out. With that, we can anticipate more regulations and mechanisms in place to protect consumers against overspending when using BNPL services in 2023 and to ensure that BNPL offerings provide consumers with convenience and value while minimising their credit risks.

Real-time payment systems: Transcending borders as the way forward

Back in 2021, Singapore created history by launching the linkage of Singapore’s PayNow and Thailand’s PromptPay real-time retail payment system – such linkage is the first of its kind globally. Subsequently, the Singapore government announced plans to link PayNow with DuitNow, Malaysia’s top real-time payments platform which has more than 8 million users.

For those who frequent Malaysia, this may be a good piece of news! It is known that the first phase of the linkage has been rolled out in the 4th quarter of 2022. In the future, consumers will be able to perform a variety of tasks such as making real-time fund transfers between Singapore and Malaysia with just a mobile number. In addition, customers will be able to make payments in retail stores by simply scanning the NETS or DuitNow QR codes displayed at merchants’ storefronts. This initiative is expected to bring about greater convenience to residents of both Singapore and Malaysia by simplifying the remittance process and enhancing in-store payment experiences. Moving forward, Singaporeans may be able to use PayNow when conducting transactions in Malaysia. The integration of India’s Unified Payments Interface with PayNow is also expected to go live in 2023. Such integration will enable users to transfer their money overseas easily, facilitating remittance.

The payments industry is still rapidly evolving as we expect to observe new and exciting developments. With greater growth, the various payment offerings are also expected to come under greater scrutiny in lieu of stricter government regulations moving forward.

References

Admin, S. (2022, October 21). Buy Now, Pay Later (BNPL) Working Group launches BNPL Code of Conduct for Singapore. Singapore Fintech Association. https://singaporeFintech.org/buy-now-pay-later-bnpl-working-group-launches-bnpl-code-of-conduct-for-singapore/

Association of Banks in Singapore. (n.d.). PayNow – PromptPay Linkage. https://abs.org.sg/consumer-banking/pay-now

Baharun, A. S. B. (2022, May 9). The growing popularity of ‘buy now, pay later’ in Singapore. KrASIA. https://kr-asia.com/the-growing-popularity-of-buy-now-pay-later-in-singapore

Devanesan, J. (2023, January 3). Payment Trends Set to Dominate Asia 2023. Fintech Singapore. https://Fintechnews.sg/68166/payments/how-payment-trends-are-set-to-evolve-across-asia-in-2023/

Experian Appointed to Operate Singapore’s “Buy Now, Pay Later” Bureau. (2022, November 24). Experian. https://www.experianplc.com/media/latest-news/2022/experian-appointed-to-operate-singapore-s-buy-now-pay-later-bureau/

Fintechnews Singapore. (2022, January 5). Singapore Fintech Report 2022: Fintech Reaches Critical Mass in Singapore. Fintech Singapore. https://Fintechnews.sg/57639/Fintech/singapore-Fintech-report-2022/

Fintechnews Singapore. (2023, January 31). Samsung Wallet Begins Roll Out in Singapore and 7 Other Markets. Fintech Singapore. https://Fintechnews.sg/69180/e-wallets/samsung-wallet-begins-roll-out-in-singapore-and-7-other-markets/

Kit, T. S. (2022a, October 21). “Buy now, pay later” code of conduct launched to protect consumers against debt accumulation. CNA. https://www.channelnewsasia.com/singapore/buy-now-pay-later-code-conduct-protect-consumers-debt-3016791

Kit, T. S. (2022b, November 2). New “buy now, pay later” guidelines: S>,000 cap a good start but not enough, experts say. CNA. https://www.channelnewsasia.com/business/buy-now-pay-later-code-conduct-singapore-debt-protect-consumers-3034396

Kit, T. S. (2022c, December 8). FAQ: Is it safe to store money in apps? Here’s what you need to know. CNA. https://www.channelnewsasia.com/singapore/digital-wallets-mobile-apps-money-inside-safe-3014631

Koh, D. (2020, June 27). A Guide To Understanding E-Wallets In Singapore. ShopBack Singapore Blog. https://www.shopback.sg/blog/e-wallet-guide-singapore

MoneySmart. (2022, September 9). Buy Now Pay Later Singapore: Atome vs Hoolah vs Grab PayLater vs Pace. https://sg.finance.yahoo.com/news/buy-now-pay-later-singapore-010018851.html

PPRO. (2022, August 12). ShopeePay: one of Southeast Asia’s most popular e-wallets. https://www.ppro.com/payment-methods/shopeepay/

PricewaterhouseCoopers. (n.d.-a). Fintech’s state of play. PwC. https://www.pwc.com/sg/en/publications/Fintech-state-of-play.html

PricewaterhouseCoopers. (n.d.-b). Payments 2025 and beyond: Evolution to revolution. PwC. https://www.pwc.com/sg/en/financial-services/Fintech/payments-2025-and-beyond.html

Reply to Parliamentary Question on the adoption rate of e-payments in Singapore. (n.d.-a). https://www.mas.gov.sg/news/parliamentary-replies/2019/reply-to-parliamentary-question-on-the-adoption-rate-of-e-payments-in-singapore

Reply to Parliamentary Question on the adoption rate of e-payments in Singapore. (n.d.-b). https://www.mas.gov.sg/news/parliamentary-replies/2019/reply-to-parliamentary-question-on-the-adoption-rate-of-e-payments-in-singapore

Singapore Fintech takes market share in 2022 global funding fall. (2022, July 14). KPMG. https://kpmg.com/sg/en/home/media/press-releases/2022/07/singapore-Fintech-takes-market-share-in-2022-global-funding-fall.html

Three trends shaping the future of payments in Singapore | Visa. (n.d.). https://www.visa.com.sg/about-visa/newsroom/press-releases/three-trends-shaping-the-future-of-payments-in-singapore.html

UOB – United Overseas Bank. (n.d.). ASEAN remains attractive for Fintech investments. Singapore and Indonesia continue to account for lion’s share of funding: UOB, PwC Singapore and SFA report. https://www.uobgroup.com/uobgroup/newsroom/2022/asean-Fintech-report-2022.page?path=data/uobgroup/2022/255

Wijaya, K. (2022, February 3). Singapore Fintech Market Overview 2022. CFTE. https://blog.cfte.education/singapore-Fintech-market-overview-2022/

Predicting Consumer Choices from Eye Tracking Data

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This morning at the Department of Information Systems and Analytics Seminar, Alex Tuzhilin (NYU) on his recent work entitled “Predicting Consumer Choice from Raw Eye-Movement Data Using the RETINA Deep Learning Architecture” (the paper is available on SSRN: https://ssrn.com/abstract=4341410) with his colleagues Moshe Unger (Tel Aviv University) and Michel Wedel (University of Maryland).

The essence of his talk was that it was possible to utilize advanced deep learning (Dl) techniques (transformer + metric learning) with “raw” eye-tracking data (i.e., just the x-y coordinates of the eye gaze without any additional contextualizations including area of interest (AOI) or content semantics) to predict consumers’ product choices (on a webpage that showed four products in a consideration set along with their specifications) with higher accuracy than conventional state-of-the-art machine learning approaches calibrated with fixation data (which includes raw gaze data, scanpath data, AOI data and image data). There were three additional surprising results — 1. the proposed DL model with only raw gaze data did NOT require a huge dataset — the superior performance was demonstrated with only 112 subjects’ eye-tracking data, 2. prediction reached very good accuracy very fast — we don’t need to observe the full interaction with the webpage to predict the product choice; at least in their experiment, product choice could be accurately predicted after about 5 seconds of subjects perusal of the webpage where the average total duration for the choice task was around 10 seconds, and 3. the SHAP analysis of the AutoML models showed that among the different types of data (raw, fixation, AOI and image), raw gaze data had the highest overall importance.

The study in and of itself was very interesting. But to me what was more interesting were the implications of such technologies.

First, if it is possible to accurately (maybe not perfectly but with sufficiently high accuracy) predict consumers’ product choices, wouldn’t it be possible to rearrange / redesign webpages strategically to make (or at least strongly nudge) consumers to choose a preferred product (e.g., perhaps one with the greatest profit margin, or ones with excess inventory, etc.) Such technology could easily lead to anticompetitive behaviors especially when large platforms control the display of product offerings. I am reminded of the US Department of Justice’s antitrust investigation into SABRE in the 1980s. Will these technologies also need to be regulated? If so, how? What is acceptable nudging behavior? Isn’t marketing and advertising pretty much the same thing? How can we clearly distinguish between simple nudges and manipulation (i.e., loss of the exercise of free will in choices)?

Second, although the study used eye-tracking data collected using specialized infrared eye tracking machine, the rate at which webcams are improving in quality and resolution along with more research in the Computer Vision area in inferring coordinate gaze data just by looking at someone’s eyes, makes me nervous that such technologies can quickly be deployed at large scale and technology companies/platforms that control the data interface (e.g., cell phone manufacturers since most phones have front-facing cameras; video conferencing providers such as Zoom, AR/VR headset manufacturers etc.) will gain immense power. For example, its not difficult to imagine analyzing individuals gazes during zoom meetings to predict behaviors (e.g., negotiation strategies/outcomes) and value-added services can be offered to productize strategic insights in real time.

Third, there is definitely a “creep” factor but I’m wondering what the legal norms might be for evaluating such technologies. Advanced AI techniques are just being used to create accurate prediction models about human behaviors. But isn’t generating insights about human behaviors simply psychology research (I know I am oversimplifying)? How is this application of AI and eye tracking data different from using theories derived from psychology laboratory studies to create more favorable (profitable) setups? For example, is the widely adopted practice of the decoy effect a problem? Perhaps, the difference is based on the general behavior vs. a specific person’s behavior. Psychological theories offer us a general understanding of behaviors whereas the kinds of AI techniques used in this study give the user of such technologies predictions about specific / targetted individuals.

Well, the genie is already out of the bottle. We really need to think about governance mechanisms such that technologies are used safely and for good.

Repost from: https://www.garbcan.com/artificial-intelligence/predicting-consumer-choices-from-eye-tracking-data/

What are Stablecoins and Why are Governments Pushing to Regulate Them?

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The Hong Kong Monetary Authority (HKMA), Hong Kong’s central bank, announced that it is pressing ahead with the regulation of stablecoins, unveiling a slew of measures in a report released on 31 January — almost a year after it issued a discussion paper on the subject and invited feedback from stakeholders.

Starting with the regulation of stablecoins backed by fiat currencies, HKMA said that it will supervise key activities such as the issuance of stablecoins and the provision of wallet services. Entities that conduct such activities will soon be subject to licensing requirements, which will apply not only to entities that conduct such activities in Hong Kong, but also ones that market to the public in Hong Kong or are involved in stablecoins backed by the Hong Kong dollar.

HKMA will also require the issuers of stablecoins to maintain reserves matching the amount of cryptocurrency in circulation and no longer allow algorithmic stablecoins, a significant development.

In seeking to regulate stablecoins, Hong Kong is not alone — with various regulators currently engaged in the process of contemplating and working out stablecoin regulations. In Singapore, the MAS published a consultation paper about their proposed approach to stablecoin regulations and sought feedback from stakeholders late last year. In the US, Stablecoin legislation is high on the list of priorities for the newly formed subcommittee on digital assets, financial technology and inclusion in the Republican-led House of Representatives. A strengthened regulatory framework for stablecoins is also expected to be implemented in the EU, subject to formal rubber stamping by the European parliament.

But what exactly are stablecoins, and why is there such a rush to regulate them?

More-stable coins

Very simply, stablecoins are cryptocurrencies whose value is pegged or tied to that of another currency, commodity or financial instrument.

As its name suggests, this makes their valuation more “stable” than other cryptocurrencies like Bitcoin, for instance, whose prices are more volatile and prone to huge swings.

While the price of a Bitcoin might be USD$7,969 at the start of a day and plunge 55% to close at USD$3596 at the end of the same day, a stablecoin like TetherUSD — among the more popular stablecoins — will (ideally) always be worth USD$1.

By making cryptocurrency more predictable, stablecoins can be suitable for use in daily transactions; be it for crypto traders who want to go in and out of different crypto investments in a DeFi exchange and preserve their portfolio’s fiat value without having to cash out of the crypto market entirely, or the average individual who wants to participate in a DeFi project or pay for everyday goods and services like buy a pizza with cryptocurrencies.

There are two main methods by which the value of a token is fixed to a stable figure: via the backing of assets or via algorithms.

The first category of cryptocurrencies, which includes fiat, crypto and commodity-backed stablecoins, are cryptocurrencies whose value is pegged to that of fiat currencies, other cryptocurrencies and commodities, respectively. The issuer of the cryptocurrency holds in their reserve the asset the token is pegged to — with the reserves ideally equal to the amount of stablecoins in circulation, allowing any stablecoin holder to redeem their token for the asset it is pegged to.

This, while highly stable and safe, requires issuers to hold in their reserves a large amount of assets and is thus very capital intensive.

Algorithmic stablecoins, on the other hand, are not backed by any real-world commodities and instead utilise algorithms to maintain the value of a given token. By burning or minting tokens according to supply and demand, the value of a token can be dynamically maintained at a fixed level.

However, in extreme market conditions, the algorithms may fail to keep up — resulting in the value of a token de-pegging.

This happened to TerraUSD, an algorithmic stablecoin that was pegged to the US dollar not by cash reserves but with the use of a stabilisation mechanism involving another cryptocurrency, Luna.

Last May, it lost its peg to the US dollar after a series of large dumps of the token prompted a broader sell-off in the market, leaving them unable to reinstate the peg of TerraUSD to the US dollar.

The subsequent collapse of TerraUSD, the then largest algorithmic stablecoin by market capitalization, prompted the prices of other tokens throughout the crypto market to decrease significantly, setting into motion a wave of bankruptcies in the industry.

It is against this context that HKMA has announced plans to outlaw algorithmic stablecoins and require stablecoins to be backed by “reserve assets … of high quality and high liquidity” — seemingly to minimise the risk of stablecoins de-pegging and creating turmoil in the financial system in the future.

Why regulate stablecoins?

One large reason regulators are moving to regulate stablecoins is the contagion risks they pose to the broader financial system.

Eswar Prasad, a professor of economics at Cornell University, pointed out in a recent interview with CNBC that “if there were to be a loss of confidence in stablecoins, maybe because some exchanges come down or for other reasons, then we could have a wave of redemptions (of stablecoins), which would in turn mean that stablecoin issuers have to redeem their holdings of treasury securities, and the large volume of redemptions even in a fairly liquid market can create turmoil in the underlying securities market”. He added that regulators were therefore right to be concerned about stablecoins, especially given the importance of the treasury securities markets to the broader financial system.

“Risks will increase as … (stablecoins) become more interconnected with the existing financial system,” an IMF report notes, adding that this is especially the case if, in the future, stablecoins become more widely accepted and, therefore, interconnected with existing financial entities and payment infrastructures, a scenario not unlikely given Stablecoin’s potential to be used to improve the efficiency of cross-border transactions.

Should the substitution of currency through cryptocurrency markets accelerate, stablecoins could also be the source of spillovers into exchange rates markets, giving regulators much reason to step in and exercise oversight.

How about CBDCs

Another key consideration for central banks seeking to regulate stablecoins is how their own digital currencies fit into the broader picture.

Central Bank Digital Currencies (CBDCs) are essentially digital tokens not unlike cryptocurrencies but are issued and backed by the central bank.

An Atlantic Council tracker shows that 100 nations are developing, researching or have already launched a digital currency. CBDCs will potentially make the financial system more efficient by decreasing reliance on intermediaries such as clearing houses and banks, while also promoting the financial inclusion of the disenfranchised.

Despite their similarities, some experts believe that CBDCs and stablecoins can co-exist, with the use of stablecoins for specific purposes being complementary to the use of CBDCs as a general-purpose currency.

Central banks, however, may decide that even stablecoins backed by assets in a 1:1 ratio are not necessary in light of CDBCs and thus disallow stablecoins entirely.

A broader reckoning

While governments have an imperative to regulate stablecoins given the heightened risks they pose to the broader financial system, it remains to be seen if stablecoins will be an exception or if the regulation of stablecoins will create the impetus for governments to exercise further oversight over other areas of the cryptocurrency space, in the same way they regulate other financial institutions.

Questions about the appropriate regulatory approach to the broader cryptocurrency space are particularly pertinent in the aftermath of the crash of FTX. The crypto-exchange, once among the most high-profile ones in the world, was forced to suspend withdrawals and subsequently file for bankruptcy late last year and currently faces serious allegations, including the improper use of customers’ funds. Temasek Holdings wrote down its 275 million dollar investment in FTX last November and Sam Bankman-Fried, the founder of FTX, has since been extradited to the US and faces fraud charges.

Speaking at a panel at the World Economic Forum in Davos, Tharman Shanmugaratnam, the Chairman of the Monetary Authority of Singapore (MAS), said that there is a need to step back and ask a basic philosophical question before considering regulating cryptocurrencies the same way we do banks and insurance companies.

“Does (regulation of cryptocurrency) legitimise something that’s inherently purely speculative and in fact, slightly crazy? Or are we better off just providing ultra clarity as to what’s an unregulated market and if you go in, you go in at your own risk,” he said, adding that he leans a bit more towards the latter view.

With regards to the wider crypto space, the HKMA said in its report that it will continue its discussion with other stakeholders, adding that while it embraces financial innovation and encourages companies to explore the potential of distributed ledger technologies, it “will continue to monitor market developments and the risks that different categories of crypto-asset may pose to monetary and financial stability”.

Bondee Revises Privacy Policy after Backlash Against NFT Plans

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Feb 7, 2023 – Bondee, the latest social networking app, has come under fire for previous mentions of NFTs and a blockchain wallet in its privacy policy, which has since been removed. Popular among the youth of Southeast Asia, it has risen to the top of the download rankings. Backlash from current users stem from common misconceptions about blockchain technology, namely its perceived environmental impact and detriment of young, impressionable users. The largely negative reception towards crypto-gaming highlights the need for Web3 companies to educate consumers about this new technology.

Bondee Receives Backlash – What People Need to Know About Crypto-Gaming

Bondee is the latest social networking app that has taken the youth of Southeast Asia by storm. Launched by Singapore-based tech startup Metadream, the app has climbed the download rankings, sitting triumphantly at the number one spot in both the Apple App Store and Google Play Stores of Singapore, Malaysia, and Thailand.

The app allows users to interact with each other in a virtual space via customisable 3D-animated avatars. Its trendy design and similarity to popular games such as Animal Crossing or Club Penguin are only part of why commentators have dubbed Bondee a ‘next-gen social app’. Its ability to connect users through virtual activities seems to be a massive draw for its primarily Gen Z user base.

However, the social networking phenomenon landed itself in some hot water recently over allegations that the privacy of users’ financial data was breached. Metadream has since denied these allegations.

Metadream has declared that no financial information is currently collected upon the user’s download and registration. Bondee’s previous privacy policy contained a clause indicating its intention to integrate a blockchain wallet and NFTs. Since receiving backlash, however, the clause has been removed and the current privacy policy does not contain any mention of NFTs or cryptocurrency.

Bondee’s prior policy on crypto integration outlined how users would be able to create a public blockchain wallet where fiat currency could be exchanged for in-game currency (B-Beans), which could then be used to purchase NFT products within the app.

This sparked dissent and controversy amongst current Bondee users. Current users have expressed their unwillingness to support crypto mining due to its perceived negative environmental impact. A Tweet that has received over 1,000 views states: “the reason why I don’t do Bondee: NFTs [are] not safe for the environment”. Netizens also voiced their intention to uninstall Bondee once the blockchain integration would be mobilized.

Amidst the maelstrom of users withdrawing their support for the app, there were also many who were confused. One Twitter user asks: “can someone please educate me about this whole Bondee NFT thing going on because I was having fun until [it] got complicated and I see that the app is related to NFT”.
So, what does a NFT and blockchain wallet mean, actually? And why are so many people against it?

Why gaming platforms are looking to integrate blockchain technology

Melding virtual currency with real-life monetary value is not a new concept. Millennials weighing in on Bondee have commented how the app’s previous plans for NFT integration is reminiscent of Habbo Hotel, a popular early 2000s massively multiplayer online (MMO) game where users paid fiat currency for in-game tokens. Habbo Hotel infamously became known as a hotbed for financial crime; authorities investigated hundreds of reported cases of virtual theft, where digital assets such as virtual furniture worth thousands of euros had been stolen. This arguably cast an ominous shadow over future endeavors to integrate virtual token systems with real-world currency. User reactions to another popular MMO Ni No Kuni’s integration of NFTs have been largely negative: the game had been ‘ruined’, according to multiple reviews.

In-game assets such as cosmetic items, weapons, or furniture have always been sold on a gray market. A quick search on online secondhand marketplaces will churn up a plethora of gamers selling in-game assets for sale in fiat currency. Using traditional payment systems, many of these transactions carry the risk of fraud on both ends. Trading on third-party marketplaces also means that the game platforms do not see the profits from these transactions. Games integrating blockchain technology offer a solution to curb these issues of their predecessors.

Crypto-games such as Meta Masters Guild and Fight Out – have been seen as the Web3 evolution of play to earn (P2E) gaming. This new wave of internet innovation is characterized by its incorporation of blockchain technologies and decentralized technology. This new technology uses a network of computers (nodes) that contain the shared history of every crypto transaction ever made. Each transaction submitted to this collection of data is subject to a validity check by the nodes. This affords the user the ability to complete secure, verified payments online without the need for a third party such as banks or credit card companies. With this, the digital assets are completely and securely owned by the user. Game developers also benefit from blockchain technology by keeping the trading of digital assets within the game platform. From this, the platforms would be able to earn revenue from the resale of in-game digital assets.

Despite theoretically benefitting both the game developers and users, crypto-gaming endeavors have consistently been met with criticism.

Cryptocurrency and the Environment

In a tweet that has garnered over 11,000 views, a Twitter user warns their followers about Bondee’s previous plans for blockchain wallet integration: “It’s not safe! They support NFT and aren’t good for our environment […] the party is kinda canceled.”

The narrative that crypto and NFTs are inherently detrimental to the environment is largely due to the energy-intensive nature of Bitcoin and certain other blockchain technologies, which are likely to contribute to an increase in global carbon emissions. The energy demand of the Bitcoin blockchain alone is estimated to be around 110 Terawatt Hours annually, comparable to the energy consumption of countries such as Malaysia and Sweden. However, this does not mean that all blockchain applications are detrimental to the environment; not all blockchains are created equal.

All blockchains utilize a consensus mechanism in order to maintain trustworthy records across many computers without the need of a centralized book-keeper. This system ensures that all the computers on a decentralized network are in sync and validates the transactions by checking digital signatures. The most well-known consensus system is proof-of-work (PoW), where users must solve complex problems before transactions can be added to the network. For this, high-powered computers generate random numbers on a trial and error basis; energy consumption for this can total up to more than that of a country with a large population.

More recently and more commonly, Web3 companies are using a more environmentally friendly alternative to the proof-of-work mechanism: proof-of-stake (PoS). This consensus mechanism requires users to have their transactions validated by a random validator chosen by a weighted algorithm – no energy-draining supercomputers required.

If Bondee had followed through on its plans to integrate blockchain technology, it would have more than likely used the latter consensus mechanism, which would not have caused the catastrophic environmental destruction that netizens had been anxious about.

Are companies like Metadream preying on young users for financial gain?

Opponents of Bondee’s previous plans for blockchain integration have also cited concerns over the questionable ethics of integrating real-world money into a game aimed at a young, impressionable demographic. This tweet with almost 8,000 likes accuses Bondee of “taking advantage of the millennial/Gen Z dream of having affordable housing and just being able to dress up all day for them to be a whole NFT company”.

It is unsurprising that the Singaporean startup would make a clever foray into crypto-gaming. Despite the crypto winter in Europe, Singapore remains a powerhouse in fintech innovation. A gateway into digitizing the Asian market, Singapore offers decentralized finance (DeFi) companies the promise of growth and development, especially with government backing in the form of policies and incentive programs. With Bondee, Metadream taps into a promising crypto market – the youth of Singapore. A report from City A.M. in the last quarter of 2022 shows that 62% of Singaporean crypto investors were under 35. More recently, a 2023 survey by GoBankingRates Best Banks showed that more than a quarter of Gen Z respondents believe it is critical for their bank to have a cryptocurrency exchange or platform.

Bondee’s cute, fun, gameplay lures in young millennials and Gen Z users. This move addresses a critical point for Web3 companies looking to tap into the NFT market – ensuring consumers see actual value in the digital tokens. Critics of Porsche’s recent failed NFT collection cited the lack of perceived utility and value behind the tokens as a key player in the mint’s downfall. Through Bondee’s gameplay, Metadream immerses users in the metaverse (a virtual-reality space). Doing so allows users to develop a sense of value when it comes to digital assets and virtual belongings, which is imperative to the success of a NFT launch. For this reason, it makes sense why the company specifically targets younger, more impressionable users. Not only do the youth already have a persistent interest in crypto, but they are more likely to be influenced to develop a sense of value around digital assets.

The Future of Blockchain Gaming

Whether or not Metadream will continue their blockchain integration efforts remains unclear, but one thing is apparent: there is a lack of clear, reliable information about this burgeoning technology. The younger generation, especially, lack education about the possibilities blockchain technology affords. Misinformation and misrepresentation in the sensationalist age of social media has made navigating this new technology all the more confusing and frustrating; it is understandable that Gen Z and millennial users feel taken advantage of.

Companies need to improve communications with their user base. Change needs to happen gradually – current users have to be introduced to and become familiar with blockchain technology. The idea behind Bondee’s immersive gameplay as a method of warming users up to DeFi gaming may have been a good one. However, the mention of crypto being only in the fine print left a sour taste in users’ mouths – it perpetuates the stigma of crypto companies being part of a nefarious, predatory scheme.

Undoubtedly an ambitious and innovative move in the evolution of DeFi gaming, the success of Web3 companies’ attempts to get youth onboard the crypto and NFT train remains to be seen.

Identifying Scams in Crypto – How Do We Detect and Counteract Them?

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Be Alert Against Scams!

In the past decade, more and more people have become interested in cryptocurrency and the digital assets associated with it. While the virtual world has opened up a wide range of possibilities, it has also become a hotbed for scams. During the Christmas season of 2022, the NUS FinTech Lab experienced this firsthand, as cybercriminals used the FinTech Lab’s name and the NUS logo to create fake websites, social media accounts, and even mint tokens with the name “NUS FinTech Lab (NUS)”.

This article details the steps NUS FinTech Lab took to identify and counteract a fraudulent website and associated tokens, and how you can do the same if targeted with a similar attack.

Fake Tokens:

A group of scammers have created fake tokens on Binance Smart Chain and are promoting them through a fake Telegram account and website. They are using the NUS logo and a fake Twitter account with the handle @nus_lab and the name “NUS FinTech Lab” to promote it.

To find out the token holders and other details, we searched for the token address on Binance’s Smart Chain (BSC) Scan. The token addresses and holders, as well as the quantity held, can be found under the “Holders” tab.

A few of the websites that have published the tokens are :

1.https://thebittimes.com/token-nus-BSC-0x9285d9a79cd1da8f1d5904ed38bbef5c82f4f587.html

2. https://recentcoin.com/token/nus-fintech-lab-nus-0x9285d9a7

3.https://cryptovotelist.com/newborn/0x9285d9a79cd1da8f1d5904ed38bbef5c82f4f587

4.https://top100token.com/address/0x9285d9a79cd1da8f1d5904ed38bbef5c82f4f587

5.https://coinsgem.com/token/0x00caaff31108014071eed798ccb9197684a2e6d3

Action/measure taken:

To protect members of the general public who may be duped into buying these fraudulent tokens, the NUS FinTech Lab team reached out to Binance using the Report/Flag Address option available on the token’s page on Binance. As a result, Binance has posted a warning message at the top of the token page.

Fake Website:

Fraudsters may use a tactic called impersonation scams to trick people into giving away their personal information for financial gain. They create websites that look very similar to official organizations, but the domain name may be slightly different. This makes it hard to tell the real from the fake.

In the case of the fraudulent NUS FinTech Lab token, the fraudsters have created a website (fintechlabnus.com) with a URL slightly different from the Lab’s official website (dev-fintech-nus.pantheonsite.io). Do not trust this website and be sure to double-check the URL before giving out any personal information.

To make sure you are visiting a legitimate website, double-check the URL of the website or contact the official organization. For example, if you’re looking for the official website of the NUS FinTech Lab, a quick Google search of “nus fintech lab” should return the website for our organization (dev-fintech-nus.pantheonsite.io). Websites created by fraudsters are often hastily created and shared with links on social media and email, so typically do not show up as the top result in a search engine.

The scammers’ fake website copied some content from the NUS Fintech Lab’s official website in an attempt to appear authentic, but there are several signs that this group is not affiliated with NUS. For instance, the contact information listed on the website is different from the official contact details of the NUS FinTech Lab.

Copied content from NUS FinTechLab’s site

Signs that a website might be a scam can include missing information about the team behind it, a whitepaper listed as coming soon but not actually available, and an unclear description of the token being offered. For example, if the token is described as a “Music NFT” but no explanation is given for what this means or what it is for, it could be a red flag.

Additional clues that the website is fake can be found by querying the Whois database (e.g., https://whois.domaintools.com/). The fact that the domain was only created very recently (on 22 December 2022) should be another signal that the website may be suspicious. Using this information we were able to identify who was hosting this fraudulent website and contact the appropriate law enforcement authorities to take action.

To ensure the safety of our data, we have conducted a thorough review of our own internal IT systems and can confirm that our systems have not been breached.

Scrutinizing the Marketing Channels:

Be wary of online crypto projects that seem too good to be true. Scammers have been known to use social media platforms to promote fake projects, so don’t be fooled. Before investing in any cryptocurrency, look into it carefully to make sure it is legitimate. The NUS Fintech Lab has identified cases of scammers impersonating them on Telegram and Twitter.

1. https://t.me/nusofficialchannel

2. https://twitter.com/nus_lab

These scams, known as Rug Pull Scams (see https://nftnow.com/guides/scams-explained-what-are-rug-pulls-and-are-they-a-crime/), involve the scammers creating a new token and hyping it up through marketing tactics then disappearing shortly after selling it. It’s important to stay vigilant and do your own research before investing.

The FinTech Lab was able to reach out to these platforms to block (and or flag) these false accounts, but always be vigilant of any suspicious activity.

Analyze the White Paper and Identify Team members

Before investing in any cryptocurrency, it is important to read the white paper, which outlines the development process. Fake cryptocurrencies often have poorly written and inaccurate white papers that do not explain how it works or how it is intended to be used. Reading the white paper can help you understand the protocols and blockchain of a cryptocurrency, and make sure it is legitimate.

White papers should always list the names of the people who created the cryptocurrency. You can usually find their coding, comments, and discussions on websites like GitHub or GitLab. Some projects use forums and chat apps like Discord to talk about the project. If you can’t find any of this information, it’s probably a scam.

In the case of the fraudsters impersonating the NUS FinTech Lab, the code behind their token is a copy of the sample smart contract code provided by Binance for token generation. Anyone can view the code by visiting the “Contract” tab on the Binance Smart Chain Scan website. Because no information about the team members is available, buyers should be wary of trusting the project.

The blockchain, cryptocurrencies and distributed apps (DApps) are exciting new technological developments with tremendous potential to create value for fintech. However, due to the nascent nature of the technology and the lack of appropriate regulation to protect consumers, many fraudsters are taking advantage of the hype to scam consumers. As it is so easy to create websites and social media accounts to impersonate legitimate players, it is important for you to be vigilant. This article chronicles our recent experiences with a scam that attempted to impersonate our NUS FinTech Lab. We hope that our experiences and the tools/techniques we used to identify the scam can also help you conduct sound due diligence when considering investing in cryptocurrencies.