Japan Declares Emergency!🚨AI Attacks Incoming🔥Crypto Final Hope?

0:00 Japan has a state of emergency.

0:02 Today we'll break it down for you because this will have immediate impact on crypto, but something even bigger, and that of course is cyber warfare that seems to be happening worldwide.

0:13 Stay tuned, I'll explain.

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1:16 All right, so let's get going here. And I want to start off first of all with the positive side of this, and that is that PPI came in at 6.8. Expectations Japan were 7.6 so a significant move downward and if you look at the historical Japan producer prices change you can see here since July we have started to see a decline and the real question does this continue to move its way down and does Japan start to get into a position that could change things dramatically one thing though that is happening significantly within Japan is is that.

1:54 They have declared a cyber emergency.

1:56 And this, of course, is affecting millions of consumers who are affected in hacks. And this is happening really on a level that we haven't seen before. In fact, the finance minister has asked banks to improve protections against fraud after a series of cyber attacks rattled the country in recent years. Just to give you an example, I want to go to a clip real quick, because this is Japan talking about the urgency of what's happening.

2:21 Take a look.

2:22 The chairperson of the Japan Association of Corporate Executives has expressed strong alarm over a recent series of cyber attacks. GMO Research and AI said more than 940,000 records of information had been leaked. Discount store operator Mr. Max Holding said its membership information had been leaked, with as many as 1.73 million members potentially affected. Japanese watchmaker Citizen also said the personal information of about 100,000 people could have been leaked. In the case involving the car-sharing service Park24, 6.6 million records were leaked. That included addresses and images of driver's licenses that could be used as identity verification documents.

3:09 The cybersecurity firm Magnica says information leaks have become more frequent since July, The firm was seeing an average of about six suspected breaches of corporate websites a month. Since July, that number has jumped to 23.

3:25 The attackers are likely using AI to search for system weaknesses anywhere they can find them. One security researcher told us he's never seen anything like it. This news just keeps coming out, and it feels like they're spiraling, and it's very frightening.

3:41 I agree.

3:43 So it's not just cyber attacks. Now we're getting into ransomware, which is getting even more efficient. If you look at this chart right here from Ransomware Live, you can see the 23 and 2024 scores right there on the green and the blue line, right? And then you go into 2025 and six, we are seeing a dramatic increase in the amount of ransomware attacks, which of course are being also aided by AI in a lot of these tool sets.

4:10 So this is something that I'm not sure that the world is ready for, much less some of these major industries. Japan is getting on the offense, though. What they're doing is they're authorizing an offensive cyber operation.

4:22 This all started this month.

4:24 And the way that they're doing this, it's kind of a self-defense force to conduct offensive cyber operations. I wonder why we haven't taken this kind of step right here in the U.S. And I'll explain why, because this is probably going to hit stateside very soon. This was the chief cabinet secretary, Minoru Kihara. He stated that the nation faces the most complex national security environment since World War II.

4:48 That's how bad this is. And this is going to be able to enable.

4:51 Proactive cyber defense actions, basically allowing Japan's police and self-defense forces to attack and disable infrastructure using this for cyber attacks.

5:02 So basically, now.

5:04 You have almost like pre-crime, I guess, out there, going out and trying to attack installations or technology infrastructure that's being utilized, which I wonder if there's going to be any subsequent stoppages of companies that aren't even aware that this is going on. So there's going to be a lot of changes, I think, here in the very near future.

5:25 I want to go to France now because this isn't just happening in Japan. And we're going to get in some Japan good news around crypto. But I want to go into France because this is getting into some of the hacks that's occurring in France that, of course, are having a much larger effect.

5:42 Take a look.

5:43 Hackers managed to take control of the thermostats and forced them to warm overnight. Some fires also broke out, according to authorities. Leclerc, the Coopérative U Group, Monoprix and Carrefour were all affected. The worst hit was Les Mousquetaires Group, with 300 shops. Spoiled products in this Paris suburb supermarket are estimated to cost 55,000 euros.

6:06 One store manager in regional France says his fridges reached 80 degrees and everything melted.

6:12 It's an enormous loss of produce.

6:14 It's estimated tens of millions in produce will have been spoiled.

6:18 To avoid more attacks, the director has disconnected the remote operation of the store's cold units. They've switched everything off and disconnected it all so that there's no risk of further attacks.

6:29 Could Australian supermarkets be at risk of coming under similar attacks?

6:33 Oh, of course.

6:34 Yeah, no, everyone around the world is in the same position, really.

6:37 Hundreds, if not thousands, of other customers globally that still have not applied this security update to their equipment. You mentioned your Rivian being subject to AI cyber attacks. If you are in the market for a 2012 Honda CR-V with approximately 250,000 miles, let me know because I can tell you there's not one computer in that thing. It runs on Flintstone legs. All right.

6:59 So the point being is that we are starting to see an advancement. And now you've got tools that are enabling these cyber attackers to essentially leapfrog most of the attempts to of cybersecurity that's been put out there, and I think this is the challenge. Speaking of France, let's go over to one of the major companies in the crypto side of things, and that is Ledger, based in France.

7:21 They are continuing to get hit with even more implants found in Ledger, this one in a Ledger Flex, bought at Singapore Airport.

7:29 And remember, guys, this isn't AI necessarily doing this.

7:31 This essentially is intermediaries that are using old social engineering tactics to be able to intercept these devices and put them in, which of course causes this problem. And the problem is it's like a needle in a haystack. You don't know which ones are affected. So it really affects the overall performance, I think, of Ledger. All right, so Ledger came out with another statement, also an update from the CryptoBullets investigation. But remember also, this is the second, or now is the second one with the media markets, investigation now that's going to be underway.

8:03 All of this happening right now as we speak.

8:06 And of course, the Ledger CEO, Pascal Gauthier, came out doing a little bit of, I think, crowd control or at least damage control to a certain extent. I think the problem here is going to be how does this affect Ledger overall. And let me know what you guys are doing for a crypto wallet, the process that you're taking, because there's people out there right now that have completely abandoned the hardware devices and are starting either one to move back into exchanges, software wallets, or projects like Tangium.

8:36 Let's go over to Ledger's $ 4 billion IPO. This was tripling their 2023 valuation. Now, I think this starts to change. And I am concerned that we are going to see this across a that are not even crypto-oriented is that we're going to start to see cyber attacks and issues occurring that could start to affect not only what we saw in France in terms of infrastructure around food and all sorts of devices, I think it now gets into the point where it hits the S & P 500.

9:06 So be on the lookout.

9:07 Now, so much so that they have OpenAI going out there putting a $ 1 billion fund behind cyber defense for water utilities and community banks. Now, some of this may be PR. Let me pose one more question. Let's go back to that headline right there.

9:23 And let's just reread this for a second.

9:25 OpenAI puts a billion behind cyber defense. And they target two areas here, water utilities.

9:31 And community banks.

9:32 Now, community banks seems like a very convenient statement there. When you have what we have seen in the past two years, the big banks saying that community banks aren't capable, this is where stablecoin and dollar flight.

9:47 Is going to occur.

9:48 Is this just something that's going to continue to push more and more people into centralized systems out there?

9:56 Pay attention, guys. It's not your money if you put it in a bank.

10:00 Just to give you an example of where these hot zones are, you'll notice right here is Japan, flashing red right there. You'll notice it right there on the hot zone maps here on Radware. This is the live threat map for cyber attacks. Next up, you've got France and Germany also being hit. And then you have the United States also flashing red in terms of web attacks that are starting to accelerate. Okay, so you can kind of see this is a challenge that I think the industry, when I say industry, business is going to face in a big way.

10:35 So what does Wells Fargo do?

10:37 Well, they go out right in the middle of all this and say they're going to go in and prepare for a potential crypto stablecoin opportunity in the U.S., I implore that some of these banks who are not ready, Wells Fargo is not ready for this, unfortunately. This could give crypto a bad name. If we see a major bank take a hit, in some cases, I wonder if that's constructed into some sort of narrative. These are the kind of things I'm watching very closely, and I do not agree. I don't think banks should be doing this.

11:06 It should be tuned into companies like Circle. even Tether and other stablecoin companies that really understand this. And then the neobanks that have been operating in this understand the security layers that need to be there. Now, Bill Gates came out, and it's kind of interesting because I don't often agree with him, but I might agree with him on this.

11:26 Take a look.

11:27 The front that we'll probably see most dramatically in the next year is cyber attacks, because there there's a known business model. Are you create a disruption that changes something in the stock market or some betting thing that you go and do. The real danger right now is not the AIs getting out of control. We need to work on that, but that's years away in terms of the big.

11:58 Impact that might have.

11:59 It's really bad people using AI, particularly in AI where you can take out all the safeguards. We put in safeguards to try and avoid you doing cyber attacks. But right now, you're allowed to take all those safeguards out. That's where over the next year, primarily in the Siberia, we are going to have a lot of negative surprises.

12:25 Sam Altman, it sounds like, would suggest that you are falling into the trap of doomerism.

12:30 How would you respond?

12:35 Point being here, guys, is that this, I think he is right on that. I do think we are going to deal more with on a cyber warfare level than we are right now directly with AI actually becoming, you know, killer robots. But it just puts something I think out there that many of you need to be aware of. And that is that sometimes you just overextend what you're doing online without any security at all, because you've kind of given up privacy to a certain extent.

13:03 And what I would.

13:04 Suggest to any of you is, one, of course, get a really good VPN. Two is get off of Gmail. Get off of these centralized mail servers. Get into something that starts to protect you. Even go into secured third-party messaging apps. I mean, there's several of those out there, Signal, Threema, all of those for super secure. Because sometimes when you're transmitting just messages that you think are not being watched or pulled in, all of that kind of data, is a target vector for a cyber attack. And that's when we start to see social engineering take place like what we see right now in Japan, where it's really starting to affect just general everyday citizens.

13:42 So think of that.

13:43 Jumping back to Japan, because there's a lot of crypto updates.

13:46 That are underway here.

13:47 One of them, as you guys know, we had Backpack on not too long ago. They have just announced a new hire as head of strategy and corporate development in Backpack of Japan. This means that they are underway. A few have navigated the Japanese crypto regulatory landscape as extensively as this.

14:04 Guy who they got from Kraken.

14:07 Remember, Backpack is one of the Mika regulated oriented exchanges that is, I think, maybe next generation. So pay attention to what Backpack is doing there. Further into it, if you just look at what Backpack's been doing on the charts, right there is the one year, guys. This has been something that has absolutely exploded. I'm interested in this one only in the sense that it does something that in many cases, yes, there's KYC.

14:31 So I'm going to get that in the comments. I understand that.

14:33 But the point is, is it's a next generation KYC that I think will replace how banks and maybe even centralized exchanges are going to operate.

14:41 So pay attention there. Etho also on the move here.

14:45 On-chain IP asset and license registries, now a new proposal out there, ERC-8432. One note right here is that this is Sonium right there. Let me kind of zoom in on that for you. And they are supporting this. So obviously Sonium, Sony, one of the biggest IP holders out there. And what it does for you is very critical.

15:06 Look at this. It's bigger than you think.

15:08 Sonium is pushing IP beyond simply putting assets on chains. These are the things that are going to be oriented within 8432. Creators define the rights. Licensee becomes readable on chain.

15:19 Huge.

15:20 And then agents can now understand what they're allowed to use. This is a big deal because this has been one of the biggest concerns for IP holders out there is that agents are just going to run amok and utilize protected IP material. And this may be the key. And this is all happening on Ethereum. So another good benefit for what's going on within ETH.

15:42 This is another one. Big concern right here with midnight. This, of course, related to Cardano.

15:47 This could supercharge adoption in Japan with private payment for POS. Point of sale and how it's integrated into the JPY coin is very critical because Japan is making major moves to try to get adoption on that. I'll show you that in a second. Charles Hoskinson was out there, of course, doing something very specific to Japan, which was creating essentially a new smart contract called Night Frames. So going directly at payments in Japan, pretty big deal in terms of what this could be. Let me show you something, though.

16:22 This you have to go in and actually convert this to English to understand what they're doing. But this is happening right now. This is like the FTC, the Fair Trade Commission in Japan. And what they're looking at is activity and use of stable coins in point of sale. So cashless payment market. If you look at some of the things I want to highlight, one is this right here.

16:43 We've received concerns from participating stores that giving preferential treatment to JPYC payments may result in violations of the merchant regulations and And there have been many instances where they have hesitated to implement preferential treatment. So let me kind of explain this for you. You're going out and you're getting a Starbucks, right? Visa goes out there and says, hey, you need to use the dollar instead of USDC, if that were the case.

17:08 Here it's JPYC.

17:10 And instead, Visa says, hey, you can't do that. You can't give benefits to your customers because of this right here. Look, they can confidentially implement preferential treatment measures such as discounts, free shipping, for customers who use JPYC. So that means that these retailers are out there trying to actively move to that system. Further into the article was this right here.

17:33 If they don't comply, and I'm talking about Visa type of companies, these payment network rails, if they don't comply, product could become an antitrust issue.

17:43 So think about that.

17:44 You now are dealing with a battle between the point of sale and the type of payment that you can actually use.

17:52 Because they want, guess what? They want those merchant fees.

17:55 This is something we've talked about at an extent, I think, maybe more than.

18:01 Most shows out there. But we talk about it a lot.

18:03 Because it is, I think at some point, going to be an issue that's gonna be raised here, even.

18:07 Here in the US.

18:08 Here's Japan talking about JPYC and they're advancing it to the masses.

18:15 Take a look.

18:16 I will deliver one yen. I delivered one yen. Oh no, if it were JPYC, it would have been immediate. Packing was unnecessary.

18:43 I understand, guys.

18:44 Maybe not into anime, but Japanese people are. And they're doing it at a younger audience, which is the audience that's using digital payments. More and more, this only affects one thing, and that is Japan becoming a major sector player in the market.

19:01 So why is all this important?

19:02 Well, here's a good example of it right here. This was on Kaichain. They were talking about the regulated yen already in circulation. Next, it needs somewhere to trade. That means the rest of Asia. Here's an example. Ratio FX signed an MOU, memorandum of understanding, with JPYC. This is the issue of Japan's FSA-approved JPY stablecoin, Circle.

19:25 Think of it that way.

19:26 To explore collaboration in stablecoin, FX, cross-border payments, and digital asset infrastructure. Basically, setting up all of Asia to start to utilize this big deal going forward. Here's a video that explains it a little bit more. This is John Chu going at it.

19:44 Take a look.

19:45 There have been no frameworks or legal guidelines around what local stablecoins can and can't do. But once those are in place, I think we will see a lot of transition of existing stablecoin infrastructure in Asia move to local stablecoins because there's a lot of cost savings, especially for that last mile aspect of on and off ramps.

20:04 Who's going to win the stable coin race on this side of the world?

20:07 I've seen a lot of movement shift away from, I have to be careful, but shift away from Singapore to Hong Kong. Definitely Hong Kong is well positioned to become the digital asset hub of Asia, largely because Hong Kong is also the settlement gate for mainland China. So yeah, I think Hong Kong will come out like pretty strong once all the local stable coins are out there.

20:30 It's important because you have to look at Asia individually.

20:33 And Japan as essentially an epic battle that is occurring right now.

20:38 Who's going to control the Asian market?

20:40 And the reason is Hong Kong is now going to license crypto brokers, custodians, advisors, and it's really setting up to overtake the entire market, which is what we missed here in the U.S.

20:53 Because of political.

20:55 Corruption, not getting clarity act through or not getting a framework through that would be acceptable for many of these kinds of people in the finance sector.

21:05 That is the problem.

21:06 And now Hong Kong laying up into a position where they could start to challenge Japan, of course, putting up a fight here, I think, and going forward as well. So watch that one very closely. And all of this boils down to one other thing. Here's a major chain doing a full blown event, not in Hong Kong, in China, It all starts this week.

21:27 This is Solana.

21:28 And look at this, the cities. This is, again, not Hong Kong. That's Shanghai, Hangzhou, Shenzhen, Beijing. All of those are in mainland China. This is the country that banned Bitcoin mining in 2021 and pretty much wrecked the market. Is something happening now where we're starting to see a battle brewing in the east?

21:50 Stay tuned.

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