Korean Financial Authorities Address Concerns Regarding Large-Scale Crypto Delistings
Hongji Feng
Last updated:
June 18, 2024 06:23 EDT
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1 min read
The Financial Supervisory Service (FSS) of Korea has responded to concerns surrounding the rumored mass delistings of altcoins, clarifying its limited involvement.
In a recent report by EBN, the FSS emphasized that it does not directly oversee the review of virtual asset listings. While the financial authorities contributed to the establishment of listing standards, they are not directly involved in the reviewing process.
Delisting Rumors Spark Panic Selling in South Korea
The upcoming implementation of the Virtual Asset User Protection Act in July has raised anxieties among investors. According to Daehan Kyungjae, regulators will begin reviewing transaction support for approximately 600 coins on virtual asset exchanges starting next month.
The Act, which will come into effect on July 19, mandates that fiat KRW-trading platforms like Upbit, Bithumb, Coinone, Korbit, and Gopax adhere to its regulations. As a result, investors have started panic selling, fearing that numerous altcoins may face delisting.
The report indicates that around 16 altcoins are rumored to be at risk of delisting from the won-based listing market by next June. This speculation has led to a significant decline in value, with approximately half of the coins listed on Upbit’s won market dropping by 10-20%.
Limited Involvement of FSS in Listing Reviews
The Virtual Asset Supervision Department of the FSS stated, “The mentioned content is supplementary material submitted to the National Assembly during the legislation of the Virtual Asset Law.”
“At that time, there was a request in the National Assembly for the Financial Supervisory Service to assist in establishing a unified listing standard for exchanges,” the authority added.
They further explained, “The financial authorities inspect virtual asset operators and do not directly conduct reviews of the products. We were asked to provide assistance in creating best practices, in which we participated, but the official announcement will be made by the exchanges and DAXA.”
An official from a domestic won-based exchange stated that the trading support best practices aim to consolidate the review standards previously carried out by each exchange into a unified framework.
The official also suggested that the likelihood of mass delistings causing harm to consumers is minimal. They emphasized that the new practices are not expected to significantly disrupt investors.
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