There is a lot of activity happening in South Korea’s cryptocurrency space. Just this week it was reported by local press that the amendment to the Special Reporting Act passed in South Korea, effectively making cryptocurrency fully legal in the republic.
This is a big step for the technologically inclined country and represents a move towards better understanding and acceptance of cryptocurrency by the regulators. More so, it also means that the space will be better controlled and there will be less chance of badly run, or scam, projects slipping through.
With that, the timing of recent coin delisting on some of the country’s biggest exchanges could not have been better. Bithumb and UPbit, two of South Korea’s largest crypto exchanges by volume, have recently started to delist, suspend, or flag many cryptocurrencies with investment warnings.
This is another big move from inside the cryptocurrency space as it represents a tightening up on projects that probably do not deserve exposure to investors for a myriad of reasons.
While the delisting coming from the two exchanges in South Korea has not been prompted by any regulatory action or direction, it has still been well thought out and quite welcomed.
According to Longhash, UPbit abruptly announced that it is delisting 17 cryptocurrencies. The primary reasoning behind the delisting of most crypto assets on UPbit was the lack of communication between the developers of the cryptocurrencies and the exchange.”
As a general note on flagging cryptocurrencies with warnings, the UPbit team said:
“Due to difficulties in communicating with the project’s tech team, there might be problems related to tech support. Liquidity is small, making the coin/token vulnerable to price manipulation. Therefore, to protect the investors, an investment warning has been issued.”
Bithumb also issued a statement after it designated several cryptocurrencies as “investment warning cryptocurrencies” due to similar issues.
The company added:
“Bithumb has been designated and announced Populous (on January 16, 2020) and CyberMiles (on January 23, 2020) as Investment Warning Cryptocurrency in accordance with the [Bithumb Investment Warning Cryptocurrency Designation Policy]. Bithumb continued to monitor the eligibility for listing, but the reason for designating the investment warning has not been resolved.”
Ever since the 2017 ICO craze which saw thousands of cryptocurrency projects spring up, and most of them die off, leaving many investors burnt, there has been a bigger focus in ensuring accountability for such projects.
These warnings and delistings look to be smart moves from the South Korean exchanges as it clears up the ecosystem and leaves less chance of investors losing money to bad business, or to scams. It also ensures that when regulators decide to look into the space, they see a much better organization.