Last week, we touched upon a new piece of Komodo tech bolstering the speed and efficiency of our upcoming (soon!) mobile crypto wallet. So what do online fraud and our smartphone app have in common? Well, the answer is quite simple: everything.
Since most of SEA’s mobile-connected residents handle the entirety of their finances from a phone, downloadable apps are hackers’ primary target. But thanks to our cybersecurity partner, Hacken, the contents of our wallet remain in possession of their rightful owner.
The good news for thieves is that there’s plenty of fish in the sea. 2018 closed with 391M mobile Internet users in six SEA countries alone — Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam.
And speaking of Vietnam, unfortunately, our home turf is the most susceptible to swindling within Southeast Asia’s financial system.
APAC’s Reign as the King of Fraud
Compared to the rest of the entire globe, the Asia-Pacific region sees a much higher rate of digital trickery. And, the Southeast accounts for 40% of roughly $650M in annual losses within APAC. Drilling deeper still, Vietnam’s rate of financial chicanery is the highest inside SEA.
Although the above graph shows a downward trend in fraudulent activity, APAC is still, on average, 50% more prone to attack than any other locale. In some instances, recently activated security measures mean a drop in thievery. However, because anti-fraud efforts fail to keep pace with economic growth, citizens’ financial activities remain at risk.
Naturally, Vietnam’s banks get caught in the web of lies. A 2018 report indicated Vietnamese banks sustained 8.3k cyberattacks that year. It’s also believed that over 500k online devices contain malware intended to swipe account information.
Southeast Asia’s digital economy seems to be on a collision course with disaster. And the team here at RedFOX Labs has a few ideas for turning the ship around.
Empowering the Government
Don’t let the big G-word scare you away! This isn’t about taxation or regulation, although there may be a domino effect on both issues. Instead, we’re discussing financial protection via modern tech. Now, banks won’t sit idle as cyberthieves pillage millions from their coffers. And with such overwhelmingly high losses, you can bet your last Dong (VND) that bankers are intent on patching any holes in their networks.
One approach, which we wholeheartedly condone, is to work alongside the government to implement blockchain tech. Now, some have expressed their desire for change but fell short of calling for the use of distributed ledgers. But in our minds, Vietnam’s banking industry is practically begging for a blockchain solution.
For example, take the following statement from Lê Anh Dũng, Deputy Head of the payment department within Vietnam’s central bank. At a recent banking conference here in Ho Chi Minh City, Dũng commented on the current state of affairs:
“In Vietnam, security risks such as customer fraud, network attacks on bank infrastructure, and user data leakage are rising.”
While blockchain can combat most types of fraud, the last part of that statement is particularly applicable. The root cause of data leakage is insecure storage.
Hack after hack on corporate databases proves that central points of failure are not acceptable business practice. And that’s doubly true for the financial industry responsible for people’s livelihoods. By spreading user data across a network of distributed nodes, there’s no single entry point for a bad actor to invade.
After acknowledging the country’s pressing need for answers to nationwide problems, Lê Anh Dũng identified the gov’t as a contender to bring about change:
“The government of Vietnam should develop a legal framework for user data security and information security to create a safe and reliable digital transaction system.”
Hmm. A “safe and reliable” digital transaction system. Can you think of anything that fits the bill? Maybe, just maybe, Dũng is referring to a blockchain network?
Now, rather than rest on our laurels and wait for SEA’s gov’t officials to come to us, we’re bringing blockchain tech to them. As revealed in a previous post, RedFOX Labs is currently hiring. Our future, bilingual Regional BizDev Manager is comfortable with speaking to reps from the local government.
If you think you’d like to work for us and help drive blockchain adoption in Vietnam, we encourage you to apply. After all, disrupting legacy business models is hard work. We’d love your help in the blockchain-powered battle against Southeast Asia’s digital fraud!
The undisputed champ of financial fraud is not a comfortable title to hold. And since most wrongdoing comes from smartphone apps, we know exactly where to focus our attention.
We’d like our wallet to be on your phone yesterday. However, the old saying, “better safe than sorry” certainly applies here. Small delays are a perfectly acceptable tradeoff for 100% security. After all, we’re not talking about frequent flyer miles — although it’d be a crime to lose those, too. We must take utmost precaution to ensure everyone’s funds stay out of the hands of criminals.
By setting up shop here in Vietnam, we can easily stay abreast of current issues and trends. And a new role within our organization allows us to make inroads with local officials. It’s going to take a concerted effort to stop crooks from siphoning funds from others’ accounts. Our goal is to help governments use modern tech to add stability to their monetary networks.
Today, Vietnamese financial apps are among the world’s most dangerous downloads. But we’re striving to ensure the situation doesn’t stay that way for long.